TradeStation Review – How Does It Fare For Frequent Traders?

TradeStation Review
  • Commissions
  • Mobile Platform
  • Desktop Platform
  • Executions
  • Research
  • Short Lists
3.9

Summary

TradeStation was listed on the Nasdaq in 1997 and is a broker-dealer that caters to both professional traders and amateur investors. If you are looking for a trading tool that might work for your day-to-day, here’s why you should consider TradeStation.

About TradeStation

TradeStation started as Omega Research in 1982. The company was listed on the Nasdaq in 1997, and adopted its current name in 2001. While the broker-dealer caters to professional traders, it also has many features that will appeal to amateur investors. Find out more in this TradeStation review.

Pricing

Commissions

There are three commission schedules at TradeStation. The first is a per-trade plan that charges $5 for every equity trade. A per-share plan charges a penny per share for the first 500 shares and just 0.6¢ for each share thereafter. There is a $1 minimum commission per order. The third and final pricing schedule is an unbundled plan. Accounts that trade up to 100,000 shares per month pay one cent per share for stock and ETF trades.

Under the per-trade plan, options cost an extra 50¢ per contract. Accounts that are signed up for the per-share plan simply pay $1 per contract with no base charge.

Fees and Account Minimums

TradeStation’s primary trading tools are free for per-trade clients. The firm does not require any deposit to open a securities account. In some cases, having a minimum level of assets in your account will help to avoid certain charges. There is a $50 annual account fee in the per-trade plan and a $99.95 monthly charge for per-share and unbundled accounts. They can be avoided by meeting certain minimums.

Trading Platforms with TradeStation

Platform Details

TradeStation customers can buy and sell equities, futures, and options using the broker’s user-friendly browser-based trading system. It offers charting, option chains (including strategies), balance information, order status, and position information. Charting includes drawing tools and a few technical indicators. A graph can be expanded vertically and displayed the width of the computer monitor.

What I especially enjoyed about this platform was its simplicity. With minimal features, it’s easy to submit stock and option orders by clicking on the ‘Trade’ button that appears at the top of the platform.

TradeStation Review

Traders who need more advanced tools will find them on the broker’s desktop platform. It offers several features, including a stock screener, an options trading window, a fundamental analysis tool, and much more.

The stock screener is able to look for securities based on a variety of criteria, including volume, dividend yield, earnings per share, and many more. The software is a little difficult to operate, however, compared to simpler website-based scanners from TD Ameritrade and Fidelity.

What I liked most about TradeStation’s desktop program was charting. It is very advanced, with more technical indicators than the broker’s browser platform offers. Some of the available studies include Keltner Channel LE, Gap Down SE, and Dollar Trailing. There are also more drawing tools.

One convenient feature that the desktop software has that the browser doesn’t offer is placing orders from a chart. Orders can be submitted directly from a graph on the desktop program using either hot keys or an order ticket on the side.

Trade Station Platform

TradingApp Store

TradeStation offers a TradingApp Store where many discrete programs can be downloaded and used on the desktop platform. Some are free, while others are not. There are many different types available. For example, Ichimoku Indicators is a technical analysis tool not integrated within the desktop platform. It is free to download. Relative Volume Indicators costs $5 per month. It uses intraday volume in futures and stocks to help traders predict price movements.

The TradingApp Store can be accessed directly from the desktop platform. Just click on the ‘TradingApps’ tab on the left-hand side of the screen. Then select ‘TradingApp Store’ from the available tiles. When you download an app, it will be automatically integrated into the platform.

Trade Station Trading App Store

Automated Trading

Automated trading is possible at TradeStation, and many of the apps in the TradingApp Store are for this purpose. One of them is Crude oil – Ri. This app costs $199 per month, although it has a free trial. It identifies trends in petroleum on a one-hour chart. Another automated trading app is STAR-ES Automatic. It costs $99 every month. No user input is required for the program to buy and sell S&P 500 futures. It places trades once per day using market orders.

Mobile Trading

A mobile app is available for Android and Apple users. It can obtain quotes, place orders, and analyze charts with technical studies. Option strategies are available, as is market news in article format.

TradeStation Mobile
Research Tools

As already mentioned there are several technical and fundamental tools on the desktop platform that can be used to search for securities. The website has more limited learning materials, especially compared to a broker like Fidelity.

Customer Service

A representative at TradeStation can be reached Monday through Thursday from 8:00 am until 8:00 pm, EST. The broker closes two hours early on Friday and is closed all weekend. These hours are much less generous than a broker like Ally Invest, who offers 24/7 phone and live chat support.

Executions and Routes

TradeStation is a direct-access broker. Orders placed on any of its platforms will have a route selection. The default choice for every order is ‘Intelligent,’ and this selection costs nothing extra. Choosing this option allows TradeStation’s computerized system to send an order where it will find the best price. Venues include BYX, IEX, Knight Link, and NQBX.

Shorting Stocks

Shorting stocks is permissible at TradeStation. One app that I really liked in the TradingApp Store is called Intraday Short Locate. It is able to request locates of equities that aren’t easy-to-borrow.

TradeStation Review: Type of Trader TradeStation is Best For

Due to TradeStation’s complicated commission schedule and advanced trading tools, the broker is obviously best for professional or advanced traders.

Pros…

  • Lots of sophisticated apps in its app store.
  • Good rates for high-volume traders.
  • Mobile app has good charting capabilities and is able to place orders for option strategies.
  • Futures can be traded.

…and Cons

  • Software fees and trading requirements are rather high for per-share and unbundled plans.
  • Lack of 24/7 service is an inconvenience.

Summary

TradeStation offers good resources to frequent traders. The cost of the broker’s software can be very steep, however, if you don’t meet account minimums.

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