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TradeStation is a broker founded back in the year 1982 that is based in the United States. TradeStation is regulated by Finra (US regulator) which makes them legitimate. (Regulator companies that are based in countries like the US, UK etc. are usually better than regulators from countries like Cyprus. ) In the following review, I will try to breakdown TradeStation’s broker platform, pricing and more in pros and cons so that you can decide if TradeStation is a good choice for you.
Features And Tools
Just like in all my other broker reviews, I will start with all the investment products available. TradeStation offers a big variety of investment vehicles: Their main focus lies on Stocks/ETFs, Options and Futures. But Mutual Funds and Bonds are also available. In this aspect, TradeStation is fairly broad and has something for almost every trader. TradeStation unsurprisingly also has a huge selection of assets available.
Available account types in TradeStation are: Individual, Joint, IRA, Entity and Custodial. (The Individual account type is the standard account type that most people use). The minimum deposit of $5000 is sadly relatively high compared to the most other retail brokers.
As you’d expect from a good broker, TradeStation also offers tons of advanced charting features. You can fully customize your charts with different time frames, indicators, drawing tools, chart types and much more. This is especially useful for all the traders that use technical analysis in their trading. But even if not, good and interactive charts always are nice.
Another great feature is paper/virtual trading. TradeStation allows you to trade with paper/virtual money risk-free. This is especially great for beginners or traders that want to test out a (new) strategy. Otherwise, paper trading is also a great way of discovering and trying all the available features of the broker platform.
All of this is available in different formats. On a computer, you can either download TradeStation’s desktop platform or use the platform directly from inside a browser of your choice (supported browsers: Mozilla Firefox, Internet Explorer, Google Chrome, Safari). Otherwise, you also have the opportunity to download the platform on your mobile device. The application is 100% free and available for both Android and IOS. TradeStation’s trading platform is fully customizable, which is great.
Furthermore, TradeStation offers some of the best education that I ever have seen a broker offer. A complete section on their website is dedicated to trading education only. They offer the education on many topics: on specific trading strategies, asset classes, options, beginner guides, basics, trading tools, trading platform, market outlook and much more. They even offer live market briefings and more. The best thing about their education is that it is completely free. I always like the fact that a broker offers education because it really shows that the broker cares for their clients and wants them to make money and be profitable.
Then TradeStation also has many great, more advanced features to offer. A big one being TradeStation’s custom programming language: EasyLanguage. With the help of EasyLanguage TradeStation allows you to build fully custom own trading indicators and algorithms/strategies. This is extremely powerful and only a few retail trading platforms allow you to do this. Many people see algorithmic and automated trading as the future of trading. A huge part of the most successful hedge funds and other institutions use data-driven and algorithmic trading to make their money. So seeing some implementations of this in the retail world of trading is amazing. Strategies and more (created with EasyLanguage) can be backtested as well. The huge amounts of data needed to do backtesting are provided. Not only stock trades can be backtested, options and futures as well.
Just as the name implies, the language is very easy to learn as well. It mainly consists of normal English words. Tutorials can be found all over the web and inside of TradeStation’s education center as well. Even if you have no or only a little experience with programming, it shouldn’t be hard to learn EasyLanguage.
Additionally, TradeStation has more advanced features like their RadarScreen. This, in essence, is nothing else than a market monitoring tool that scans the market for custom criteria that you set. This is great and time saving for people that are searching for specific setups. In addition to that, TradeStation also has a market depth analyzer tool and more advanced tools.
Last but not least, TradeStation also offers relatively good customer support. Support is available longer for institutional investors than for retail traders.
Pricing – TradeStation Commissions
Commissions in TradeStation are pretty good. They may not be the very lowest in the industry, but they definitely are on the very low side and quite competitive. As you partly can see above, the commissions are:
- Stocks and ETFs: $5 (per trade)
- Options: $5 (per trade) + $0.5 (per contract)
- Futures: $1.5 (per contract)
- Mutual Funds: $14.95 (per trade)
- Bonds: $5 (per bond) + $14.95
This is the standard commission plan. But TradeStation has the option to change this. Depending on your account size, trading volume and amount of trades per week/month, it could make sense to change the pricing plan. There are pricing plans that help traders with smaller accounts. But the biggest benefits are offered to active and traders with bigger accounts in a special pricing plan.
TradeStation vs Scottrade vs TD Ameritrade vs Ally Invest vs Merill Edge – Pricing Comparison
As clearly visible on the table above, TradeStation offers fairly cheap commissions compared to most other brokers. The only one beating TradeStation of these five is Ally Invest. But Ally Invest has nowhere close to as many advanced features as TradeStation.
TradeStation is one advanced and good broker platform. Many investment products are available and the pricing is quite competitive. There are a lot of advanced tools to analyze the markets. My personal favorite feature is their proprietary programming language EasyLanguage and the backtesting tool. This may be the future of trading and it is great to get a feel of it as a retail investor. In my opinion, this feature is extremely powerful and accessible at the same time. EasyLanguage is easy to learn and the educational content needed is provided.
TradeStation is an institutional grade broker. Some big institutions and hedge funds use TradeStation to trade and analyze the markets and there is a reason for that. TradeStation simply offers a variety of very advanced and amazing tools/features. In the past, the institutional trading industry has always been separated from the retail industry. TradeStation is one of a few brokers that gives retail traders the same advanced tools that institutional traders use.
But is TradeStation for you?
Yes, if you:
- Want or/and need advanced tools to trade and analyze the markets
- Are an experienced trader and know what you are doing OR you are willing to put in some time to learn all the tools and more (with the education provided)
- Are an active trade or have a big account
- Want to get into algorithmic trading with the help of EasyLanguage
- Want to Backtest Trading Strategies with TradeStation’s huge database
No, if you:
- Are a beginner, aren’t familiar with trading/brokers at all and don’t want to put in some time to learn more
- Have a very small account (under $5000) and/or trade very infrequently
P.S. If you are or have been in the US. Military, you can trade with no or much lower commissions.