Tradestation brokerage review, rating, pros and cons, commissions, fees, account minimums, trading platform, IRA investment research tools, education, and customer service.


Tradestation Rating:  TradeStation rating


Overview of Tradestation

Based in Florida, TradeStation has been providing brokerage accounts and powerful software for more than 20 years to clients around the world. This review will assess the brokerage firm in important areas.


Investment Lineup

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For both taxable and tax-deferred trading, TradeStation offers self-directed services only. There is no investment advice or financial planning. Available tax structures include:

  • Trust
  • Individual
  • Joint
  • Corporation
  • IRA
  • Limited partnership
  • LLC

Whatever tax structure is chosen, the account will have access to a wide range of investment products. These include:

  • Stocks
  • Funds (closed-end, mutual, and exchange-traded)
  • Options
  • Futures and options on futures
  • Bonds

Besides U.S. residents, TradeStation accepts applications from residents of many other countries. They get to trade the same lineup of assets we have just seen. Besides the U.S. exchanges, TradeStation has a partnership with Interactive Brokers that opens up foreign exchanges (and more asset classes like forex) for both American and non-American customers.

Securities (but not other products) held at TradeStation are protected by SIPC up to the standard $500,000 limit. TradeStation has an excess SIPC policy through Lloyd’s of London that is good for $24.5 million per customer and $300 million in aggregate.


Minimums and Fees

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TradeStation has two pricing schedules: one for American residents and another one for foreign residents. U.S. residents pay nothing for online trades of stocks and ETFs, although there is a lot of fine print. Examples include:

- Stock must be priced above $1
- $25 for a broker-assisted trade
- 0.5¢ per share for shares above 10,000 in a trade and for directly-routed orders

Futures and options on futures are $1.50 per contract, per side, while options are a little cheaper—just $0.60 each. Treasury trades cost $50.

Non-U.S. residents have the same pricing schedule except that stocks, ETFs, and options have a base charge of $5. Neither group of investors has to make an opening deposit, although to access some of the trading platforms, which we’ll look at below, an account must be funded.

TradeStation does have a notorious $50 inactivity fee. It can be avoided, however, with a $2,000 account balance or an annual trade history of at least 5 transactions.

Real-time data at Level I is free for equities, futures and options on futures, indexes, and equity options. Other data packages could come with fees. These can range from $0 per month up to $131, depending on the bundle selected.


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Promotion to Open Account

Get up to $3,500 for making a deposit at TradeStation.

Open Tradestation Account

Margin Trading

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As a high-powered broker, TradeStation of course offers margin accounts. It’s possible to open an account on a cash basis if desired. A margin account will be able to trade with leverage. Day traders get up to 4:1 leverage on many securities for both long and short positions, although some assets have higher initial and maintenance requirements. These stocks are posted on TradeStation’s website (look for the green link in the left-hand column for the symbol lists).

The margin schedule at TradeStation has just two tiers. The lower level is below $50,000 in borrowed money and costs 13.5% per year. Above that amount, but below $500,000, the cost is 12.5%. Above $500,000, the interest rate is negotiable.


Website

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TradeStation’s website isn’t the easiest platform in the world to use. The Accounts tab at the top of the site is a good place to manage an account. Here, it’s possible to view balances, gain/loss details, positions, and other important information.


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The site itself has no actual research or trading resources. For these functions, there is a blue button in the top-right corner to place a trade. There are three platforms under the button: securities, and futures options. Each platform requires a relevant account (securities, futures options).

The securities platform is available in both live and simulated modes. They have the same tools, which include:

- Vertical price ladder for quick trades
- Horizontal trade ticket for more advanced orders
- Full-screen charts with lots of gadgets
- Options window with many integrated spreads
- News articles from Benzinga


Mobile App

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TradeStation’s mobile app has been recently updated. It has a new layout but keeps most of the same tools. Horizontal charting, however, has been lost. The options, news, and ladder windows we saw on the website make appearances on every security’s profile. At the top of every profile are icons to add the asset to a watchlist or enroll it in alerts.


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The order ticket has the same advanced order types the horizontal ticket on the browser platform has. These include:

  • Bracket orders
  • Trailing stop
  • Limit
  • OCO (order cancels other)
  • OSO (order sends other)

Upcoming earnings releases are displayed under the Events tab, which is accessible on the Markets page. Unfortunately, the app doesn’t have mobile check deposit or live streaming of video news.


Desktop Program

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For the absolute best trading experience, there is TradeStation 10. This is the company’s flagship trading software, and it is on a very high level.

There are layouts, called workspaces, already integrated into the platform. Some examples we found include:

- Futures Trader
- Market Scanner
- Find a Trade Idea
- Day Trader


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It’s possible to edit a layout to custom-build it. Multiple charts can be displayed in a single layout, and a single chart can be blown up full-screen. Charts have many tools, like technical studies and drawing gadgets.

The Apps tab in the upper-left corner of the site contains lots of add-ons that make TradeStation 10 a professional-level experience. Examples include:

- Intraday short locate
- TSAlgos
- OptionStation Pro
- Walk-Forward Optimizer


Day and Swing Trading

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PDT Rule: Securities accounts must maintain at least $25,000.01 in account equity to day trade at TradeStation. Futures accounts do not have to follow this rule.

Level II quotes: Available on TradeStation 10.

Shorting: TradeStation customers can short securities and futures. The broker’s software has discrete buttons for sell short. The website has a list of easy-to-borrow securities and a threshold list of securities that are restricted for short selling. Both lists appear under the green symbol-lists link already mentioned.

Direct-access routing: TradeStation offers several routing choices, although as already mentioned, these trades do come with surcharges.

Routing fees and rebates: Maker-taker fees are no longer available at TradeStation on trades of securities.

Extended Hours: TradeStation clients can trade securities from 8 o’clock in the morning until 8 o’clock in the evening. Futures and digital currencies have much longer hours.


Banking Features

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One of TradeStation’s major weaknesses is a lack of cash-management tools. There are no bank accounts here, and no hybrid securities-bank accounts that are now common elsewhere in the industry. TradeStation’s website does have a user-friendly tool to transfer funds by ACH or wire.


Customer Support

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A good place to find customer service on a TradeStation account is under the Support tab that appears on the broker’s website. Here, we found phone numbers for a variety of departments to place trades (such as futures and securities) and an email form. Trade desks are generally available whenever markets are open. This means futures department can be reached 24 hours a day, while the securities department has mostly weekday hours.

For general account service, there is a service department that can be reached during the week from 8 o’clock in the morning, Florida time, until 5 o’clock in the afternoon. The website also has an online chat widget that is available during the same hours.


Other Services

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Initial Public Offerings: Available through a partnership with ClickIPO.

Fractional-share Trading: Not available.

DRIP Service: Not available, either.

Individual Retirement Accounts: TradeStation does offer IRAs. It has Roth, Traditional, SIMPLE, Rollover, and SEP accounts. There are futures IRAs that have some pretty steep fees. The broker’s securities IRAs come with a $35 annual fee and a $50 termination fee.

Periodic Mutual Fund Purchases: Not possible.


Our Recommendations

Mutual Fund Investors: TradeStation offers no search engine to find mutual funds, although they can be traded on the website (with a $14.95 transaction fee). We would head to Firstrade instead and use its search wizard and pay no transaction fees.

Beginners: TradeStation is designed for experienced traders. Beginning investors should open an account with Robinhood.

Active Stock and ETF Trading: TradeStation is an excellent broker-dealer for the frequent trading of equities, especially with its desktop platform.

Long-Term Investors and Retirement Savers: Although TradeStation does have IRAs and lifecycle mutual funds, it doesn’t have much else in terms of long-term financial planning. Charles Schwab, by comparison, has investment advisors, retirement calculators, and much more.

Small Accounts: Because of TradeStation’s inactivity fee, we don’t recommend it for small investors. Webull has no such fee.


Tradestation Review Summary

Although TradeStation excels in some areas, it stumbles in many others. Experienced traders can do well here, though.