Scottrade Review – How Does This Broker Compare?

About Scottrade

Scottrade.com is a national online discount broker with a syndicate of 503 branch offices located throughout the country. The discount brokerage provides great interaction with a live consultant that contacts you personally after opening an account. This may be a bit too intrusive for active intra-day traders but investors will find it reassuring to interact with a human.

The company started as a live discount broker and added online services and platforms along the way, but it still remains a discount broker at the core and offers banking through Scottrade Bank, retirement planning and investment consultant services. Phone support is routed to a representative from the nearest local branch. It’s impressive how the offices act as the customer support network. Aside from the live and in-person aspect, the online, mobile and platform offerings are very well designed with intuitive functionality.

https://www.youtube.com/watch?v=fccUn_8ZAW8

Commissions and Fees

Scottrade has a per-trade commission schedule for online, broker/phone-assisted trades as well as trades executed through the Scottrade Elite platform. Stock trades cost of $6.95 for online stock and ETF trades. Broker-assisted and phone supported trades are $32. Options trades cost $6.95 plus $0.70 per contract online, broker and phone-assisted trades cost $32 plus $0.70 per contract.

ScottradePRO adopts the Interactive Brokers white-label platform to provide a per-share pricing structure of $0. 005 per-share with a $5 minimum for equities and $0.50 per-contract with a $5 minimum. This is basically an Interactive Brokers platform under the ScottradePRO label.

Brokerage accounts require a minimum of $2,500, while IRA accounts have no minimums. Scottrade Elite accounts require a $5,000 minimum. There are no annual or inactivity fees. There are over 2,500 transaction-fee-free mutual funds. Early redemption fee for these funds if held less than 90-days trigger a $49.99 penalty.

Margin rates range from 6.25% for $1 million or more on a slaiding scale to 9.75% for amounts under $10,000.

Platform Features and Tools

Scottrade has multi-platform access to service the needs of all levels of investors and traders.

Scottrade.com is the gateway client website access point for account details, educational tutorials, support and research. Trades can be made online from this point forward. Scottrade has a useful tool called SmartText that will apply any selected indicator(s) to any stock and provide an interpretation of the analysis. Nifty tool for newbies to learn about specific indicators, however, always take generic automated programs with a grain of salt.

Scottrader Streaming Quotes is a Java-based platform with real-time quotes and charting with over 30 common technical indicators including stochastic, moving averages, Bollinger Bands, MACD and On-Balance Volume. The $10 monthly fee is waived for customers who make more than 10 trades a month.

Scottrade Elite is the standalone desktop platform best suited for active intra-day and swings traders, that takes the Scottrader Stream Quotes platform to the next level. The platform is quicker because it is standalone, not Java-based. The design is aesthetically pleasing with intuitive functionality. Sounds quirky, but the font style is very sharp and conducive to clear focused trading. Access to this platform requires at least $25,000 to meet the Pattern Day Trading (PDT) rules and a minimum of nine trades executed per quarter.

Scottrade Pro is the Interactive Brokers (IB) white-label platform with the per-share pricing. Anyone who’s traded on IB ‘s platform will be instantly familiar with Scottrade Pro platform because it’s the same thing. Scottrade originally had collaboration with Optionshouse for derivatives trading, but Etrade acquired them. This caused Scottrade to find another partner, Interactive Brokers. Ameritrade acquired Scottrade shortly afterwards. Can you say consolidation? The industry is quickly becoming a turf war between handfuls of behemoths.

Scottrade Mobil is the portable version of the Scottrade.com website gateway with not only the ability to place trades and access research, but also enables bill pay and fund transfers through Scottrade Bank.

Charts

Scottrader Streaming has decent java-based charts, which are fluent but Google Chrome can eventually be a resource hog. I prefer the Scottrade Elite for using multi-time frame charting to get a better perspective. This platform feels more stable, which is the advantage of a standalone versus web-based.

Technical Indicators

Scottrader Streaming has 30 indicators, which is plenty in my opinion. All the basic price and momentum indicators like moving averages, Bollinger Bands, stochastic and MACD are included. Scottrade Elite expands the indicators to more than 60, including volume, news-event indicators. I found the Velocity and Forces indicator very interesting.

Level 2 Quotes

All platforms have level 2 streaming data windows and time and sales. Scottrade Elite naturally feels more stable and better integrated with the whole platform. Windows can be linked to watch lists and charts.

News

The news feeds are exceptional streaming Dow Jones headlines, which is still the Rolls-Royce of news feeds and most importantly market reactions. Research reports are sourced from Reuters, S&P and Merrill Lynch for investors. Advanced new traders may prefer a platform like EquityFeed or Briefing, but Scottrade does have an impressive news stream.

Scanners and Research Tools

The screeners are pretty basic with fundamental based screens by metrics like P/E ratios, market cap, revenue growth and industry. Scottrade Elite also has a bunch of pre-defined screens including momentum, candle, signal-based scans, which are intuitive and quick. For intra-day, I still find the new highs/new lows the most useful and relevant real-time scan. More experienced traders may prefer scanners like Trade Ideas or EquityFeed.

Order Entry and Executions

The tab-based order entry windows can be clunky. There is no direct-access routing so trades are handled by in-house market makers and contracted specialists. I was a bit weary about this but the fills have been impressive and they can support some nice sizes beyond what is displayed on level 2.

Watch Lists

Scottrader Stream has nice watch lists that accommodate up to 40 symbols. Having too many watch lists can be a resource drag through the java-based platform. Scottrade Elite seems to have better resource management as it can accommodate multiple watch lists simultaneously without any noticeable lag. Stocks on the watch list can be linked to level 2 and charts for quick point and click access.

Platform Differentiators

Although the Scottrade Streaming Quote is a good platform for more casual traders and investors, the Scottrade Elite is the best of overall platform offered. As mentioned before, I really am drawn to the sharp fonts along with a bunch of nice little details that I find to be really helpful. I find the additional trading stats like total percent and average winning trades to losing trades incredibly helpful. Overall, Scottrade is very similar to competing discount brokers like ETRADE and TD Ameritrade.

Is Scottrade Right For You?

Scottrade is well suited for casual traders and investors on the majority of the plans. It is similar to other discount brokers like ETRADE and TD Ameritrade. Active traders will find the Scottrade Elite platform stable, intuitive and packed with unique innovations. Investors and traders who desire a human interaction similar to a full-service brokerage at a discount price will reap the most gains here. If you are trading more actively and require more advanced tools, consider checking out SpeedTrader.

Pros

• Flexible choice of trading platforms
• Seasoned traders will find the Scottrade Elite platform very intuitive and engaging
• Strong pre-defined scans embedded into screen tool
• Mobile app adds more flexibility and access
• Per-trade commission option offered on white-board IB app

Cons

• Scotttrade Pro commissions can be overpriced with a $5 minimum trade compared $1 minimum at IB.
• No direct order routing