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.

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

• $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

Options are one of the stronger 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 extra $0.75 per contract, which does not apply to ETF options such as SPY and QQQ.

Buying 10 standard contracts produces $4 in contract commissions before regulatory or exchange fees. A 100-contract strategy costs $40. At that point contract pricing matters far more than whether stock trades are technically commission-free.

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 is unusual because the experience changes significantly depending on which trading software you choose.

The standard web platform is the simplest route, designed around straightforward stock and options trading rather than a professional workstation. Mobile access covers positions, balances, orders, quotes and trading stocks and options. For ordinary self-directed investing this may be all you need.

ChoiceTrade Elite costs $39.95 a month, waived when monthly activity reaches either 50,000 shares or 250 options contracts. It adds streaming quotes, advanced charts, options spread strategies, Trade Finder scans, heat maps, institutional and insider activity, news and mobile access. This is the most interesting middle ground: more functionality without jumping to DAS pricing.

DAS Trader is the specialist option at $175 a month, with a free 14-day demo. It adds streaming real-time quotes, time and sales, advanced charts, real-time alerts, Nasdaq TotalView, Level 2, API access and additional market data. The commission changes too: from $0.003 per share up to one million shares a month, falling to $0.001 above that, with venue and regulatory charges on top. Monthly volume must exceed 100,000 shares.

Premarket and after-hours trading uses Day+Ext orders, and extended-hours execution carries an additional $0.005 per share. On a 100-share order that is $0.50. On repeated 5,000-share trades the economics look quite different. Calculate fees using monthly share volume rather than one example order.

International traders are part of the proposition

ChoiceTrade explicitly supports international clients across Latin America, the Middle East, Africa and Asia. That makes international access one of the more meaningful parts of the offering.

Non-US retail accounts carry a $10 monthly maintenance fee, plus a one-time foreign-account setup fee of $25 for individuals and $100 for entities. Incoming foreign wires carry no ChoiceTrade fee, although intermediary or sending banks can charge their own. Outgoing foreign wires cost $60.

For an international investor primarily interested in accessing US securities, those costs may be perfectly acceptable. They should simply be included in the calculation.

Margin, day trading and account minimums

A margin account requires at least $2,000 in equity. The published margin rate is the Federal Funds rate plus six percentage points, although larger diversified balances may be eligible for negotiated rates.

Margin requirements depend on the position. Long marginable equities generally begin at a 50% initial requirement, while short positions and options can be much higher. Uncovered calls and short puts are notable: ChoiceTrade requires $100,000 minimum account equity for those strategies. So although options access is inexpensive at $0.40 a contract, not every options strategy is equally accessible.

Cash accounts start from $100 and normal margin accounts require $2,000, but accounts established for day trading require $25,000 along with margin approval. The broker also recommends, without requiring, that prospective direct-access traders have previous online and live direct-access experience.

Fractional-share trading is supported for certain securities, but more restricted than whole-share trading: market orders only during core market hours, and not every security is eligible. Fractional positions also cannot be transferred through ACATS, so on an account transfer the fractional component generally has to be sold and moved as cash.

Fees outside trading

The headline commission schedule is not the only cost worth checking.

Non-US accounts also carry the $10 monthly maintenance charge. None of these are necessarily deal breakers, but ChoiceTrade is a good example of why a broker review should look beyond stock commissions. Moving an account away can cost more than placing dozens of ordinary trades.

Who ChoiceTrade fits