Best online broker for active traders

I just checked my trading activity over the last 60 days and had a heart attack. 300+ trades with an average size of 2000 shares/20 contracts and more than $3500 in commissions. I currently use Ameritrade and TD Waterhouse (which might end up merging soon if you believe the press). I don't mind Ameritrade, but I saw that Fidelity offers active traders commissions at $8 each ($3 less than Ameritrade) and was thinking that I am paying too much in commissions. Also, Ameritrade is a pain in the butt at the end of the year because I have to manually input my trades for taxes.

So, are there any other brokers that offer (1) good execution, (2) lower commissions (flat rate regardless of trade size), and (3) downloadable trading data into TaxCut or other tax software?

Thanks!

I've been thinking about ScotTrade at $7/trade. Can't say what service they offer, so I shall be following this thread to find out more about who likes what brokerage. ScotTrade has local offices. Mostly I trade with USAA brokerage at $20, that was less than that a short while ago, but went up and will be reduced only for a great many more trades than I'm likely to make. So it goes. I have paid whopping fees over the years, with one fee over $80 back when I still called and talked to a human being instead of doing the trade myself online. That's too much to pay. -Zer (who mostly trades in even hundreds, sometimes doing a thousand if the price and my MMF allows me to do it)
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john5023 said: I just checked my trading activity over the last 60 days and had a heart attack. 300+ trades with an average size of 2000 shares/20 contracts and more than $3500 in commissions. I currently use Ameritrade and TD Waterhouse (which might end up merging soon if you believe the press). I don't mind Ameritrade, but I saw that Fidelity offers active traders commissions at $8 each ($3 less than Ameritrade) and was thinking that I am paying too much in commissions. Also, Ameritrade is a pain in the butt at the end of the year because I have to manually input my trades for taxes.

So, are there any other brokers that offer (1) good execution, (2) lower commissions (flat rate regardless of trade size), and (3) downloadable trading data into TaxCut or other tax software?

Thanks!

couponjohn said: Very good question glad it was asked but it looks like even tough it was asked long ago you got little response.. Bump it up for response.Woah there, buddy. An hour and eighteen minutes is NOT "long ago." At least not outside of Hot Deals it isn't. This thread was still on the first page when you bumped it, for crying out loud.

That said, welcome to FWF.

hfzeus said: Try Brownco.com

I'll second the recommendation for Brownco. For active traders like you, you qualify for volume rebates. $5 for market orders and $10 for limit orders, less any applicable discount for volume.

I switched from Ameritrade to Ameritrade Izone to drop the commissions from $10.99 to $5. I have been happy so far. The only drawback I can see is that you lose Streamer. But you can get free real time quotes from other places, so it was not such a big deal for me.

I use Scottrade, and for my purposes they're all right. $7/trade for both market AND limit orders. Kinda handy since I don't have time to watch prices all the time. They also have a java applet which makes trading/researching a lot easier, with real time quotes too.

gwagwa said: winter said: Interactive Brokers
MBTrading

How can MBTrading and Interactive Brokers offer such low commissions, as opposed to other discount brokerages, which is $5+ per trade?

I'm thinking of using these to make my weekly purchases of ETFs. Are there any problems with that? Regarding MBT, I don't see any problem with that as long as you maintain the account minimum. I have been very satisified with their service, had an account for about a year and a half.

SCOTTRADE is by far the best. USD 7 for any stock trade. market limit stop limit etc.

No fees. No minimum account balance. No minimum number of trades per quarter etc.

They have decent research and their new website is also a lot better and improved than their old one.

Their real time quote ticker is also good.

I use the active trader programs at E*Trade (Power E*Trade) and Fidelity (Gold commission level with Active Trader Pro software). I prefer Fidelity for commission level, price, trading software, and execution (only a slight edge for execution).

I did have one bad experience with Fidelity where a trade was reported about 10 days after it occurred! They said that it had been associated with the wrong account by the broker. It actually put me into a short position in an IRA account! In that case, the remedies from customer service were inadequate. All of my other experiences with them have been very good. I should note that if you trade any stocks below $1 per share, Fidelity is a very bad choice (high commissions). For trades above that level, though, the Gold commissions are pretty good. The research available from them is also better than that from E*Trade.

I've been with E*Trade for many years and have had only a few problems. Some trades have been reported back a bit late, but I haven't had issues with that in the last couple of years. The research available on their site and their active trader software are generally a bit worse than Fidelity's IMO. I had problems getting a couple of their software packages to work easily and quit trying, so there may be a few features that they offer that I'm not aware of in those packages.

I also used TD Waterhouse in the past and didn't care for their trading platform or on-line resources, but I haven't used them in the last 5 years, so they may have improved in these areas.

It's a bit off-topic since I don't know what kind of trading you do, but the dollar amounts seem a bit low for the amount of volume you do. I suspect the slippage, spreads, and commissions end up influencing your % return for the year by quite a bit. You may want to back-test your strategies based on doing half of the trades at double the volume to see whether you like the statistics better--just a thought. As I said, I don't know what kind of trading strategies you're doing, so you may have your position sizes optimed appropriately.

One other question I didn't answer concerned the ability to download into tax software. E*Trade does have this, but it only downloads what they send to the IRS, i.e., stock sales--no stock purchase information or options information. Also, if you put in an order to sell 2000 shares and it gets filled in 15 different executions, then all 15 executions are reported separately. I find it easier to manually re-enter the information into TurboTax. That way, I group all short-term trades for a particular stock on one line of the Schedule D (with "various" for the buy date and the sell date and the total basis, total proceeds, and total shares in the appropriate entries). This gets my 1000 or so individual executions down to about two pages of schedule D entries.

My Fidelity accounts are mostly IRA's or low-volume, so I haven't ever tried to export trade data from their system into tax software.

I would recommend staying away from Etrade. I used to be with Etrade and got out because they are so expensive. They have tons of stupid fees. Minimum balance fees, infrequent trading fees, high trading fees. I paid over $23 a trade since I didn't trade frequently enough. I even paid a stupid fee for transferring my account out of Etrade.
Not only that, but their IT department is incompetent (although they do answer the call quickly). They made me switch my username to a complicated one and couldn't switch it back, so I was stuck with a really dumb username. If you make a lot of trades, they might be good, but I've found that Etrade is really a poor choice for the casual investor, especially since there are so many other better options out there.

I've since moved to Brownco and it's been great. All market orders are $5, limit orders are $10 and no maintence fees. Customer service is top notch since they're essentially a division of JP Morgan. They don't have all the bells and whistles as Etrade, but that's fine since not only do I not care for the fancy Etrade webpage anyways, but I use yahoo finance for most of my research. Plus if you really want to use the Etrade research stuff, a lot of it is free even if you don't have an investment account there. Brownco has higher requirements than Etrade (you need 5 years investment experience and deposit $15k to open an account, but you can move the 15k out immediately if you want).


ICMaker said: I use the active trader programs at E*Trade (Power E*Trade) and Fidelity (Gold commission level with Active Trader Pro software). I prefer Fidelity for commission level, price, trading software, and execution (only a slight edge for execution).

I did have one bad experience with Fidelity where a trade was reported about 10 days after it occurred! They said that it had been associated with the wrong account by the broker. It actually put me into a short position in an IRA account! In that case, the remedies from customer service were inadequate. All of my other experiences with them have been very good. I should note that if you trade any stocks below $1 per share, Fidelity is a very bad choice (high commissions). For trades above that level, though, the Gold commissions are pretty good. The research available from them is also better than that from E*Trade.

I've been with E*Trade for many years and have had only a few problems. Some trades have been reported back a bit late, but I haven't had issues with that in the last couple of years. The research available on their site and their active trader software are generally a bit worse than Fidelity's IMO. I had problems getting a couple of their software packages to work easily and quit trying, so there may be a few features that they offer that I'm not aware of in those packages.

I also used TD Waterhouse in the past and didn't care for their trading platform or on-line resources, but I haven't used them in the last 5 years, so they may have improved in these areas.

It's a bit off-topic since I don't know what kind of trading you do, but the dollar amounts seem a bit low for the amount of volume you do. I suspect the slippage, spreads, and commissions end up influencing your % return for the year by quite a bit. You may want to back-test your strategies based on doing half of the trades at double the volume to see whether you like the statistics better--just a thought. As I said, I don't know what kind of trading strategies you're doing, so you may have your position sizes optimed appropriately.

10.00 a month for the live market data. If you trade at all that is nothing compared to the saving on comissions. The fills are absolutely excellent. IB should not be compared to etrade and ameritrade. They are for more knowledgeable traders. You can test their software platform on their site.

rob

skankmofo said: couponjohn said: Anyone have any experience with thinkorswim.com? I've been checking them out for option trading, only $2.95 per contract and they have single click collars, straddles, butterfly, and everything else trades. Looks like a pretty small operation started by some ex-CBOE traders. Would like to hear from someone who's used it before I put my money in there.EliteTrader.com enter ThinkOrSwim

decades said: With Interactive brokers you get the quote feed for 10 bucks a month , free with 30 or more trades that month ,do you HAVE to pay that data feed charge if you dont want data feed, and dont trade often?

Seems like IB is the better choice if you do more than 2-3 trades per month (to be cheaper than Brown and Scottrade)

maybe someone can share some wisdom with me

I've traded frequently in my IRA account because I don't have to worry about taxes. I just checked the rules on turbotax and if I make money trading actively then it is really going to hurt me tax wise. Maybe even push my wife and I into the AMT. From people that do this, are the profits worth it over the hit from the tax bill from holding securitied less than 12 months?

Interesting topic, especially since I've been grappling with the same question.

My solution was Wells Fargo. I've always thought of them as having high fees (trades, maintenance, etc.), but this month they rolled out a new deal to compete more effectively with all the online brokerages. Anyway, you have to have at least $25,000 to qualify for the program (called PMA) and your trading commissions are based on your total assets with the bank (including checking, savings, CD's, brokerage, IRA's, custodial accounts, etc. plus consumer loans and something like 10% of your WF mortgage).

If your aggregate balances are greater than $25k and less than $100k then trades are $10. If you're over $100k then trades are just $2.95 and if you're over $250k then trades are free. Not a bad deal if you've got some money. Again, it's called a PMA account. Hope others can find this helpful.

only up to 50 trades a year. then u pay $9.95.

Online Transaction Standard PMA
Less Than $100,000 PMA
$100,000 - $249,999 PMA
$250,000+
Stock Trade4 $19.95 $9.95 per trade (no limit)
$2.95 for first 50 trades/year
$9.95 thereafter Commission Free for first 50 trades/year
$9.95 thereafter

Does IB give heavy traders a free access to Nasdaq Level II? How much do you need to pay in trading fees per month in order to get Nasdaq Level II for free with IB?

Check out tradestation, IB isn't bad. If you're going to be daytrading then you're entering into another level of commissions and different companies, check out www.elitetrader.com

My own rec would be www.assent.com but more for serious daytraders and they don't offer the software import feature you're asking for.

definitely IB

Fidelity allows for fully programmed trading. A friend of mine does that. Their commissions are $8 for active traders.