ChoiceTrade Review

What ChoiceTrade actually offers

ChoiceTrade is a self-directed US broker rather than a robo-adviser or full wealth-management platform. The product set centres on US equities, ETFs, options, fractional shares and margin trading, with Traditional, Roth and SEP IRA applications available.

Standard US stocks and ETFs:

$0 commission when eligible

Options:

$0.40 per contract

Cash account minimum:

$100

Margin account minimum:

$2,000

ChoiceTrade Elite:

$39.95 a month, potentially waived with activity

DAS Trader:

$175 a month plus per-share commissions

International accounts:

Supported, generally with a $10 monthly maintenance fee

The platform can be inexpensive for the right trader, but it is not a universally free brokerage.

That is a relatively focused offering. Someone buying US shares or trading SPY options has what they need. Someone wanting a huge marketplace of mutual funds, managed portfolios and financial planning is not the audience.

ChoiceTrade fees and commissions

Eligible NYSE, Nasdaq and AMEX stocks and ETFs priced at $1 or more per share qualify for $0 online commission when the trade meets ChoiceTrade's rules. The account must have at least $100.

The main stock and ETF charges are:

• $0 commission for qualifying ordinary online stock and ETF trades
• $0.005 per share extra for Day+Ext orders used premarket and after hours
• $0.002 per share for day trading
• $25 per trade for certain other US stock trades up to 10,000 shares
• A further $0.002 per share above 10,000 shares where applicable

$0 commission does not mean every stock trade costs $0.

Buy 100 shares in the regular session:

Potentially $0 commission

Trade premarket or after hours:

The Day+Ext per-share charge applies

Day trade actively:

A separate per-share schedule applies

Trade outside the eligibility rules:

The commission can be dramatically different

The $0 rate applies to a defined group of trades: A 100-share Day+Ext order adds $0.50. A 5,000-share order adds $25 before any other applicable charges. If you trade frequently, calculate the monthly cost of your usual orders rather than relying on the cheapest commission shown on the homepage.

Options pricing is one of the better parts of the schedule. The standard rate is $0.40 per contract, with up to four legs per trade. Exercise and assignment cost $5.

Cash-settled index contracts such as SPX, RUT and VIX carry an additional $0.75 per contract. That charge does not apply to ETF options such as SPY and QQQ.

Buying 10 standard contracts costs $4 in contract commissions before regulatory or exchange fees. A 100-contract strategy costs $40, so contract pricing matters more as position size increases.

Per-share commission against the direct-access brokers ChoiceTrade sits beside

Published starting rate per share. Every one of these also charges routing, ECN and regulatory fees on top, which can matter more than the headline for high-volume traders.

Guardian Trading

$0.0005

Cobra Trading

$0.0015

ChoiceTrade

$0.0020

SpeedTrader

$0.0025

Lightspeed

$0.0035

0.0040.0020

Three very different trading experiences

ChoiceTrade offers three different trading setups. The software you choose affects the tools, monthly cost and commission schedule.

The standard web platform is intended for regular stock and options trading. Mobile access covers positions, balances, orders, quotes and trading in stocks and options. For basic self-directed investing, that may be enough.

ChoiceTrade Elite costs $39.95 per month. The fee is waived when monthly activity reaches 50,000 shares or 250 options contracts. Elite adds:

DAS Trader is the higher-cost option at $175 per month. It includes a free 14-day demo, streaming real-time quotes, time and sales, advanced charts, real-time alerts, Nasdaq TotalView, Level 2, API access and additional market data.

DAS uses a separate commission schedule. The rate is $0.003 per share up to one million shares per month and $0.001 per share above that level, with venue and regulatory charges on top. Monthly volume must exceed 100,000 shares.

DAS is difficult to justify for someone who places only a few trades. The monthly cost makes more sense when trading volume and execution tools are central to the account.

International traders are part of the proposition

ChoiceTrade supports international clients across Latin America, the Middle East, Africa and Asia.

For an international investor who mainly wants access to US securities, these fees may be acceptable. They should be included in the total cost before opening the account.

Margin, day trading and account minimums

ChoiceTrade margin accounts require at least $2,000 in equity. The published margin rate is the Federal Funds rate plus six percentage points. Larger, diversified balances may qualify for negotiated rates.

Margin requirements depend on the position. Long marginable equities generally have a 50% initial requirement. Short positions and options can require much more. Uncovered calls and short puts require at least $100,000 in account equity.

The broker recommends previous online and live direct-access experience for prospective DAS users, although that experience is not listed as a requirement.

Fractional-share trading is available for certain securities, but it has tighter rules than whole-share trading. Fractional orders are market orders only during core market hours, and not every security is eligible.

Fractional positions cannot be transferred through ACATS. During an account transfer, the fractional component generally has to be sold and moved as cash.

Fees outside trading

The trading commission is only part of the cost. Other listed charges include:

These fees may not matter to someone who trades online and keeps the account in place. They matter more when you transfer assets, request paper statements, use broker assistance or trigger a forced sale.

Who ChoiceTrade fits