Firstrade Review



Get 250 Free Trades and more at Firstrade!   Firstrade have been around for quite a long time, originally founded in 1985 as a full service broker serving the local community of Flushing New York. They were one of the first brokers to offer trading via the internet by launching their website firstrade.com in 1997.

Due to founder John C Liu’s Chinese origins, Firstrade proved popular with the local Chinese community; as a result their website is available in both simplified and traditional Chinese, you’ll be pleased to know it’s also available in English as standard.

As a small broker they’re more concerned with keeping clients happy than offering a cheap price. Speaking as someone who’s had many problems with brokers over the years, I can tell you there’s a lot to be said for great customer service.

 

Fees & Commissions

Stock Trades Options Base Per Contract Min Deposit Broker Assisted Mutual Funds
$6.95 $6.95 $0.75 $0 $27.00 $9.95

 

Website & Sign-up

The Firstrade website has a nice clean design to it; it’s very easy to navigate around and has an intuitive interface. They have fallen into the old trap of displaying T & Cs in hard to read text at the bottom of the page, but other than that they’ve done a pretty good job.

The sign-up process could be improved however; it asks a lot of unnecessary questions that are really quite annoying and if that’s not bad enough the boxes are really quite small which makes them difficult to complete.

It wasn’t a pain free sign-up procedure but at least it was completed without the need to print off forms or send in copies of my identification. In all it took me about twelve minutes to complete the process. All that’s left to do now is fund my account and start trading.

 

Trading Platform & Tools

xstream

Firstrade have come in for some stick regarding their trading platform in recent years. It used to be very outdated and limited in terms of tools. But late last year they launched a new and updated platform called Xstream.

Xstream is said to be an all singing all dancing platform that offers every tool you’ll ever need. Well in practice that isn’t quite the case, some of the more advanced tools like risk viewer, call spread investigator and volatility charts are missing, but for a beginner or small trader this platform should suffice.

This isn’t a state of the art platform but its leagues ahead of where it was before. It’s fairly easy to use, trades can be executed quite quickly, but you have to jump through a number of different screens to do so. It’s a long way short of one click trading, but it’s not a bad platform.

 

Pros

  • $0 minimum to open account
  • 10,000 mutual funds and fixed income investments to choose from
  • No inactivity or account maintenance fees
  • No annual, setup or termination fees for IRA accounts
  • Free dividend reinvestment

Cons

  • Expensive commissions for stocks under $2 or orders of over 5,000
  • Paper-heavy registration and service setup process
  • Short Term Redemption Fee of $19.95 will be applied to redemption’s of no-load fund shares held less than 180 days


Summary

Firstrade is a small broker but they’ve been around for a long time, they offer a full range of products including certificates of deposits (CDs) which other brokers do not.

Their commissions are not so small however; $6.95 for a stock trade is on the expensive side, especially since OptionsHouse offer the exact same thing for $3.95 and they have a much more capable platform to boot.

Which brings me on to another point; expensive fees are fine if you can back them up with an exceptional trading platform. A good trading platform can easily make up for the difference.

But Firstrade’s platform is pretty average, it’s missing the tools that most intermediate or advanced options traders would like to see. This platform is more suited to beginners, but what beginners need more than anything else is training.

And whilst Firstrade do have an education center, it’s pretty rudimentary. There are a few basic trading and investment guides, but nothing to help you put together a profitable trading strategy and no money management tips either. A beginner would be better off choosing a broker like Zecco who have excellent training materials and an excellent trading community specifically aimed at beginners.

So if they’re not suitable for advanced traders or beginners, who are the suitable for? Well if you’re an intermediate level trader with a medium sized account, you might want to think about Firstrade. They’re a small personable broker who treat their clients well, so if you’re sick of being treated like a number by one of the big boys, Firstrade might be worth a shot.

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