By Tim Plaehn
What Do I Need to Know About E-Trade and Buying Stocks?
By Tim Plaehn
OverviewE-Trade is one of the pioneer companies in the online stock brokerage business. They currently have over 4.5 million accounts worldwide. Online brokerage accounts allow investors to have instant access to prices and the ability to buy and sell at low cost. E-Trade provides a broad range of information and tools to help the stock market investor.HistoryThe company started business as TradePlus Inc. in 1982 in Palo Alto, California. E-Trade Securities was started in 1991. The company offered trading services through America Online and Compuserve. The world wide web as we know it today did not yet exist. By 1994, E-Trade was one of the fastest-growing private companies in the U.S. When the dot-com bubble burst in 2002, the online trading companies lost a large portion of their revenues. E-Trade responded by adding banking and lending services. In 2003, the name was changed to E-Trade Financial Services.ConsiderationsStock market investing through an online broker means the investor has to perform his own research. Before opening an online brokerage account, an investor should have the knowledge and skills to do her own research into different stocks and investments. Investors want to hold their stock positions from a few months up to many years. Traders plan on holding a stock position in time frames measured in hours and days. E-Trade provides a wide range of tools to help both investors and traders.ServicesE-Trade provides an extensive list of online tools to help the investor and trader generate profits. For investors, the E-Trade website offers independent stock research, portfolio and risk analysis and integrated account management. E-Trade goes farther than most online stock brokers by offering comprehensive financial planning and live financial advisors.
Traders have access to stock screening and charting tools, real time quotes and advanced analytics. E-Trade account holders can trade futures, options and stocks on international markets. Mobile stock tracking and trading is available through the company’s applications for the iPhone and Blackberry.FeesE-Trade charges a basic $12.99 per trade to buy or sell stocks. Active investors with more than $50,000 on deposit and who make more than 10 trades per month pay $9.99 per trade. Traders who make over 50 trades per month have a transaction price of $7.99. E-Trade offers over 1,000 no-load mutual funds with no commission or transaction costs. Option traders pay 75 cents per contract plus the standard commission and futures contracts are $2.99 each plus a trade commission. Assistance from a live stock broker to complete a trade adds $45 to the base commission. New accounts from active traders can qualify for 100 commission free trades.
All of the commission, fees and special programs are what E-Trade was offering in August 2009. It is important to check the company’s website for current promotions.Expert InsightE-Trade was rated the number-one online broker by “Smart Money” magazine for 2007, 2008 and 2009. It received five-star ratings for customer service, trading tools and research. E-Trade provides one of the most comprehensive money management programs of the online stock broker companies. The company provides financial planning and portfolio management tools for the long term investor and in-depth analytics for the active trader.ResourcesreferenceE-Trade
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