Zacks Trade review 2023
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Zacks Trade: Best for
- Active traders
- Research availability
- Trading platform
Zacks Trade gives active traders a solid brokerage experience with a number of tools favored by experienced investors. You’ll get access to a wide variety of investment research to inform your decision making, and shouldn’t have any trouble finding the account type you’re looking for. The Zacks Trade Pro trading platform is customizable and includes more than 120 technical indicators that traders can configure to their specific needs. New investors can benefit from the fractional shares that are available, but an account minimum of $2,500 could send them to other brokers. There’s also an inactivity fee of $15 per month for accounts under $25,000, so if you’re not looking to be an active trader, Zacks Trade is likely not the broker for you.
Zacks Trade: In the details
Pros: Where Zacks Trade stands out
Zacks Trade gives clients access to an impressive research offering that includes 20 free research subscriptions from various providers. You can also sign up for 80 different premium trials to help you identify different trading and investment opportunities.
Free access to independent research from sources such as Morningstar is included and you’ll also get news and analysis from Dow Jones Newswires and Thomson Reuters.
Investors particularly interested in research should also consider Merrill Edge and Fidelity, both of which give clients access to third-party research.
Zacks Trade also offers many different account types, allowing you to select the type that suits your needs. You’ll get to choose from both individual and joint accounts, and have access to traditional and Roth IRAs as well as SEP IRAs, which aren’t available at all brokers. Trust and custodial accounts are also available.
Zacks Trade also offers accounts for investment funds and institutions, but those likely won’t be necessary for individual investors. Still, the availability of these accounts means that other aspects of their offering are aiming to match the needs of professionals.
Zacks Trade offers fractional shares and new purchases and reinvested dividends, something that is often popular with new investors. Fractional shares allow investors to make sure that they can invest the full amount they wish and that there isn’t leftover cash in their account because they couldn’t afford a full share of a stock or ETF.
It’s worth noting some brokers only offer fractional shares on reinvested dividends.
When it comes to a trading platform, Zacks Trade lets clients choose between two different options. The traditional client portal allows clients looking to perform basic functions a simple view where they can place trades and access key documents and account information.
For more active traders, Zacks Trade Pro offers all the bells and whistles of a professional trading platform. You can customize the screen to whatever matters most to you and can quickly see information on options trading or your watch list of stocks. You can use more than 120 different technical indicators to help you identify your next trade and can trade directly from a chart screen.
Cons: Where Zacks Trade could improve
Zacks Trade customers will need to bring at least $2,500 to the broker in order to start investing. This account minimum is high for the industry, where most brokers allow you to get started with no minimum at all. The high minimum is likely to send new investors with little in the way of savings to look elsewhere for their broker needs.
Investors who are starting out small might consider a robo-advisor. Both Acorns and Stash allow customers to start investing with just $5 and can make regular contributions beyond that, even if they’re small. Robo-advisors allow you to build a diversified portfolio based on your goals and risk tolerance and can be appealing to new investors.
Stock and ETF commissions
At $0.01 per share with a $1 minimum, it’s hard to say Zacks Trade’s commissions on stocks and ETFs are expensive, but with most of the rest of the industry offering commission-free trades, the cost sticks out as a negative.
Customers most likely to tolerate the fees are active traders who are drawn to Zacks Trade’s professional trading platform and enjoy the vast research offering. For most other investors, they’re better off sticking with a broker that has cut their fees to zero.
While Zacks Trade doesn’t charge the standard account transfer fee of $75, it does charge a $15 per month inactivity fee for accounts with balances below $25,000. This is yet another sign that the broker is targeting active traders. It isn’t looking for investors to buy-and-hold and not generate commissions for the broker. The monthly inactivity fee is meant to encourage trading, which often works to the detriment of investors’ portfolios.
Mutual fund fees
Mutual fund trades come with a commission of $27.50, which will eat into the returns investors ultimately earn. Up until recently, mutual fund commissions were fairly common in the brokerage industry, but as with stocks and ETFs, the race is on to offer free mutual fund trades.
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