TradeStation does a good job in terms of brokerage commissions. However, the amount you’ll pay depends on the platform you choose (there are several), the assets you trade and your total trading volume.
The platform offers commission-free trading of stocks and exchange-traded funds (ETFs)—but only for orders of 10,000 shares or less. If you make a trade for more shares, TradeStation charges $0.005 per share for each security over the 10,000 limit. Keep in mind that big institutional investors, like investment banks and hedge funds, which trade potentially millions of shares a day, are core users of TradeStation.
Users should carefully consider which TradeStation platform they need. If you sign up for TS Select, which requires a $2,000 minimum deposit, you can make free trades online, through the web and on the desktop program. If you sign up for TS GO, which has no minimum deposit requirement, you can only make free trades online and through the app. TradeStation charges $10 per trade on the desktop application for TS Go users.
For stock options, futures, micro futures and futures options contracts, there are no commissions, but TradeStation charges a small fee per contract:
- Stock options. $0.60 per contract TS Select, $0.50 per contract TS GO
- Futures. $1.50 per contract TS Select, $0.85 per contract TS GO
- Micro futures. $0.50 per contract TS Select, $0.50 per contract TS GO
- Futures options. $1.50 per contract TS Select, $1.50 per contract TS GO
For mutual funds and bonds, TradeStation’s pricing is not as generous. It costs $14.95 per mutual fund trade and $14.95 per transaction plus $5 per bond to trade bonds. For cryptocurrency, its pricing system is based on your account balance, not the size of your trade. The cost runs from 0.05% to 0.30% of your balance, depending on the amount in your account.
TradeStation receives payment for order flow, meaning it collects a fee for routing trades to certain market makers. This could give the market makers a chance to trade ahead of investors. However, TradeStation says it charges the same fee to each market maker, and does not base its routing decisions on the size of rebates.
TradeStation margin interest rates depend on how much you borrow. They’re very high for small trades: 9.50% for less than $50,000 and 8.75% for $50,000 to $499,999. From $500,000 to $2 million the rate is 5.50% which is in the middle of the pack, and if you borrow more than $2 million then it’s 3.5% which is very competitive.
TradeStation does not do a great job in terms of other account fees. It charges a $50 annual inactivity fee, unless your account balance is at least $2,000 or you make at least five trades in a year. It also charges numerous other fees like $125 for an outgoing account transfer, $25 for outgoing domestic wires, $1 for paper statements and $75 for a forced margin payout. Other brokers in our survey of the online brokerage space either didn’t charge these fees or charged less.