Through our ChoiceTrade review, we’ve determined that although at first glance, the commission sturture seems very attractive, you ultimately pay for it in software fees. The most active traders, however, will still hugely benefit from the commission structure.
- 1 About ChoiceTrade
- 2 Pricing
- 3 Trading Platforms
- 4 Customer Service
- 5 Executions and Routes
- 6 Shorting Stocks
- 7 Type of Trader ChoiceTrade is Best For
- 8 Judgment
Founded in 2000, ChoiceTrade has been trying to attract frequent traders for several years. Armed with investing software and ultra-low commissions, the brokerage firm is an enticing prospect. Although it isn’t one of the big players in the industry, it’s definitely worth taking a look at. In this ChoiceTrade review, we will attempt to quantify it’s value for various types of traders.
Pricing is one of the main areas where ChoiceTrade shines.
Equity transactions at ChoiceTrade cost $5 each. An alternative plan provides market and limit day orders free of charge, which is a great way to rival Robinhood. The stocks traded under either plan must be valued at $1 or more.
Foreign stocks with ticker symbols ending in F that trade on a U.S. exchange cost $25 per transaction. OTC and bulletin board stocks are $7.
ChoiceTrade also offers two derivative commission schedules, and either one may be chosen regardless of which stock commission plan is selected. The first choice is 15¢ per contract plus a base charge of $5. The second is a flat $10 with no per-contract charge. In either case, exercises and assignments cost $5, and there is a maximum of four legs per trade.
For the $5 stock commission schedule, ChoiceTrade does not charge a monthly fee. The $0 commission plan comes with a $5 monthly fee. Both schedules require a $100 minimum account balance. There is also a $10 or $35 inactivity fee (depends on the commission plan) every three months. It can be avoided by placing at least five trades during the quarter.
There are five platforms available at ChoiceTrade, three of which come with fees. The cheapest is $14.95 per month, while the most expensive is $135.
I was excited to receive a free trial of ChoiceTrade’s website platform. After getting inside, I was surprised how simple it was. Option chains are not laid out well, for example.
Charting on a stock’s profile page does not offer comparisons, technical studies, company events, or drawing tools. There is a Java version, but I was not able to get it to function in any browser.
After entering a ticker symbol in the ‘Start’ box in the upper-left of the screen, an information section will display a chart icon. Clicking on this does produce a small graph where some technical studies and comparisons can be made.
One feature that I did like was Power Basket. Here I was able to enter orders for multiple stocks, line by line. For example, I could enter ‘Buy 5 GOOG @ Market DAY’ and similar lines of text to create multiple trades for different stocks at the same time. The trades are saved in a different section, and I had to go there to submit the orders, a slight nuisance.
ChoiceTrade Elite is a web-based platform that has some more advanced features you won’t find in ChoiceTrade’s standard web-based platform. The platform has a monthly cost of $29.95, but traders can sign up for a free 14-day trial to test the functionality before committing to the subscription cost.
This platform is certainly an improvement over the standard web platform. You’ll find most basic features you’d expect, such as watch lists, news, and portfolio management. I liked how you could select a “Chart View” on the watch lists to get a snapshot of all the charts.
The platform also has some advanced features that may justify the price tag for some traders. ChoiceTrade Elite has built-in scanners, data visualization tools, and advanced charting options.
The fundamental data visualization tools are a great feature that you won’t find in every platform. This tab makes it easy to get a quick overview of how a company is performing.
The platform also features some advanced tools for options traders.
Overall, ChoiceTrade Elite is a major upgrade to the standard web-based platform. The platform is easy-to-use and packs some powerful features.
ChoiceTrade’s mobile app was built for simplicity. You can access most basic features like charts, watch lists, options chains, and account management. The app is useful for monitoring your positions and watch lists on the go, but doesn’t provide a full, standalone trading experience. That said, active traders generally require a more robust desktop app to achieve optimal results so we rarely recommend trading from a mobile app. It appears as if ChoiceTrade is continuing to develop and expand their mobile offerings, and the app has come a long way over the years.
QuoteStream comes in regular and professional versions. The pro edition has real-time alerts and a mobile app, which the regular platform doesn’t offer. Both platforms come with headline news, advanced charts, heat maps, and streaming quotes from major exchanges. OTC quotes, data from CME, and Level II information all cost extra.
Traders who need direct-access routing can use Direct Pro, which is available as a desktop program. I thought it was much better than the broker’s website. Direct Pro comes with real-time Level II quotes (at $20 per month) and ECN books. Also useful are time and sales windows. News headlines and real-time alerts are available but news traders may prefer a standalone service like Benzinga Pro or a stock recommendation service like Motley Fool.
The platform can trade option strategies as well.
The worst thing about Direct Pro is the fact that the broker’s $0 commission schedule can’t be used with the platform. Stock trades on Direct Pro cost 0.25¢ per share with a $5 minimum.
A chart can be shown as a small window within the platform, or it can be expanded to fill the monitor. Although there are technical studies, I was dissatisfied with how they could be displayed. For example, indicators that normally are shown below a graph, such as MACD, would display on top of a graph. I could not figure out a solution to this problem. On the flip side, colors are customizable.
ChoiceTrade clients might be able to reach a company associate during the week from 9:00 am to 5:00 pm, EST. The company can also be reached by email for less time-sensitive support issues.
Executions and Routes
It’s possible to select the destination of your order at ChoiceTrade. The broker offers ARCA, TRAC, INET, and several other venues.
ChoiceTrade permits short equity positions in a margin account. Initial margin is the greater of 50% of the sale price or $5. Maintenance margin for securities above $5 is 30% or $5. For stocks below $5, it is 100%. Stocks under $2.50 cannot be shorted at ChoiceTrade.
Type of Trader ChoiceTrade is Best For
Because ChoiceTrade charges a monthly fee for some accounts, the broker isn’t ideal for inactive buy-and-hold investors. On the other hand, the broker’s $0 stock commission is ideal for traders who place a lot of trades every month using market or limit day orders.
- Very appealing commission schedule.
- A wide selection of trading software.
- ChoiceTrade allows free trials of some of its platforms, so you can take them for a test drive before committing any money.
- Using a live broker over the phone to complete a trade is an extra $30.
- The broker’s best platform right now, Direct Pro, can’t be used with the $0 commission schedule.
ChoiceTrade offers bargain-basement trading with low monthly account fees that will rival low-cost firms like Robinhood and Firstrade. Its trading tools may not be ideal for highly active traders, but the company seems to be dedicating time and resources to improving these offerings.