ShareBuilder Review



Sharebuilder is a subsidiary of international banking giant ING, they’re unique amongst discount brokers in that they offer automatic investment plans.

Automatic investment plans allow investors to take advantage of dollar-cost-averaging by arranging to have a set amount invested daily, weekly, biweekly or monthly.

You can also buy fractional shares from Sharebuilder; these are typically high value shares such as Berkshire Hathaway which are split into fractions so you can buy a slice of a share in the same way a share is a slice of a company.

 

Fees & Commissions

  • Automatic Investments: Basic plan – $4 per investment
  • Standard plan – $12/month, you get 6 automatic investments and each additional is $2
  • Advantage plan – $20/month, you get 20 automatic investments and each additional is $1
  • Real-time stock and ETF trades: $9.99
  • Options: Early Exercise – $30 per early exercise, no trade commission; Automatic Exercise – $20 per automatic exercise, no trade commission
  • Mutual funds: $19.95 for 170 no-load funds from leading no-load mutual fund families; 70 free funds including the ING mutual funds
  • Investment products: stocks, options, mutual funds, ETFs
  • Minimum to open account: $0

 

Website & Sign-up

ShareBuilder Website

The ShareBuilder website is nice and easy to use, the navigation is clear and the text is large and easy to read. Some real thought has gone into creating this website, there are some other brokers that could learn a lot form it.

Opening an account was simple and easy, I chose to open an individual trading account and the whole process was completed online in less than 10 minutes.

I transferred money into my account using ACH and it was showing in my account the next day. I wish all brokers were as easy as this.

 

Trading Platform & Tools

So far so good, but lets cut to the chase, platforms are where it’s at. On that score the ShareBuilder platform is a little on the basic side, there are no sophisticated screeners or one click trading that other brokers have.

In terms of usability it’s not bad, executing a trade is a very simple process but finding the trades is where the problem lies. This platform covers the basics and that’s all, it’s only just about suitable for beginners.

If you’ve carried out fundamental analysis beforehand then you could just about get away with it, but as a real time trading tool it’s just not good enough. ING need to invest heavily in this platform to bring it up to par.

 

Pros

  • Very low Automatic Investing Plans costs
  • Free dividend and capital gains reinvestment
  • Ability to buy fractions of a stock
  • $0 to open cash account, $2,000 for margin account

Cons

  • Real-time trades at $9.95 are expensive
  • $0.007 per share surcharge on real-time trades on penny stocks (stocks under $1)
  • Don’t know at what price investments with Automatic Investing Plans are traded
  • Very basic trading tools
  • Customer service complains
  • Terrible executions
  • Few mutual fund choices

 

Summary

ShareBuilder is only really suitable if you’re looking to invest in fractional shares or specifically looking for an automated investment plan.

Both these markets are severely limited however, and sooner or later you’re going to be looking at broadening your investment horizons and that will mean choosing a different broker.

If you’re a beginner and you’re looking to develop a strategy I would recommend you  join Zecco but TradeKing are also a good choice.

Both these brokers offer excellent trading communities for you to learn from along with comprehensive training manuals and tutorials. 12 months membership to either of these two brokers will stand you in good stead for the rest of your trading career.

If you’re an intermediate trader the ShareBuilder platform is going to fall well short of your expectations. There’s a severe lack of trading tools, charts and real time data, therefore making a trade is going to require a little guess work which is never a good thing.

I recommend intermediate traders join either OptionsHouse or TD Ameritrade, both these brokers have much more comprehensive platforms along with good training materials which are perfect for taking your trading to the next level.

In fairness to ShareBuilder and ING they seem to have tailored this service towards investors who don’t want to sit in front of a computer screen all day and think of trading in the same way as an index linked savings account.

But as a trading platform for serious investors this service falls short.




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