Does ETRADE offer recurring investments for stocks, ETFs and mutual funds? How to enroll in ETRADE automatic investing plan.

Dollar-Cost Averaging with ETRADE

Investors at E*Trade can establish an automatic investing plan (AIP) ONLY for the broker’s no-load, no-transaction-fee funds. The service costs nothing, and setting it up is straightforward.

There is an educational video on the broker’s website that presents the details of E*Trade's automatic investment plan, and the broker also has a convenient FAQ for this service.

etrade recurring investment

Eligible Products

For its AIP, E*Trade offers only no-load, no-transaction-fee funds. Stocks, ETF’s, and other mutual funds, such as load funds, cannot be set up for automatic purchases. That’s a disappointing, since with TD Ameritrade's AIP one can establish automatic investing for all mutual funds.

Visit E*Trade Website

Open Etrade Account

E*Trade Dollar-Cost Averaging

E*Trade’s automatic investing plan is a type of dollar-cost averaging. This means you’ll be purchasing a fixed-dollar amount each month, or each interval, instead of buying a fixed number of shares, as you would with automatic purchases of stocks and ETF’s.

For example, you might purchase $100 each month of AVPAX, the American Beacon Small Cap Value fund. This security is on the broker’s list of no-load, no-transaction-fee funds. When the NAV is low, you will receive more shares, and when the NAV is high, the $100 will buy fewer shares. The advantages of dollar-cost averaging are (1) you can buy fractional shares, which you cannot do with ETF’s and stocks; and (2) you get more shares when the price is low.

Funding the Recurring Purchases

The first step is to establish a regular deposit into your E*Trade investment account. Obviously, you will need funds to make regular purchases; so you need to have money coming into your brokerage account at regular intervals. E*Trade allows for weekly, bi-weekly, monthly, quarterly, semi-annual, and annual transfers. Once you establish this automatic transfer from an external bank account (which could include E*Trade Bank), it will repeat itself until you cancel it.

How to Set up the E*Trade Automatic Investing Plan

E*Trade permits up to ten automatic investment plans per customer. Each plan can trade up to fifty mutual funds; so you could in theory enroll up to 500 funds for automatic purchases.

To do so you will need to contact the broker at 1-800-387-2331. You’ll need to specify the purchase frequency you want. The available choices are once per week, every other week, once a month, once a quarter, once every six months, or once per year. AIP orders are placed only on Tuesdays.

Once a plan has been established, it will go into effect immediately. If you change your mind in the future, you can simply modify it.

Remember that each fund must have a pre-existing position, meaning that a fund must first be purchased before an AIP can be established. Each fund at E*Trade will have its own minimum purchase amount, which often is higher than $100.

If you set up an automatic investing plan in an IRA, remember that regular deposits count towards the account’s maximum annual contribution limit.

Visit E*Trade Website

Open Etrade Account

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