Transfer Broker Account From Firstrade To TradeKing

As 2007 comes to an conclusion, I make another change of my investment accounts over the weekend when I opened a TradeKing account, which will replace Firstrade as my main stock broker for stocks that pay dividend.

I got the Firstrade account in early 2006, mainly for its free dividend reinvestment feature, one that my primary broker Scottrade doesn’t have. At that time, Firstrade still had free mutual fund trading. Though I have never used Firstrade to buy mutual funds because I wasn’t so sure how long it could last, it was nice to have it as an option. In fact, that was one of the reasons that I eventually chose Firstrade over TradeKing back then. That policy, however, was abandoned last February when Firstrade adopted a similar fee structure as other brokers for mutual fund investment: charging a $9.95 commission for each trading no-load mutual funds.

When comparing Firstrade and TradeKing, other than the free dividend reinvestment service offered by both brokers, my main focus is on the commission: Firstrade’s $6.95 vs TradeKing’s $4.95. Percentage wise, the difference between the commissions charged by the two brokers is quite large, but that isn’t a big deal to me given how little I trade in a year. Plus, if I indeed switch, the $50 account transfer-out fee charged by Firstrade could potentially take me years to make up from money saved on commissions. In the end, what promoted me to make the change is the news that TradeKing will reimburse account transfer fees charged by other brokers before the end of the year. That basically solved my problem and, no matter how less, I still want to reduce the trading cost.

Of course, all of these are not necessary with a broker that charges zero commission, such as Zecco. However, I am not confident that the company can maintain their free-trading service after seeing it flip-flopped several times in a short period of time. Free-trading is nice, but I don’t want to end up having another commission based account with no other appealing features should Zecco decide to reverse course later. For that, I only keep a small account with Zecco right now.

After the latest change, my active brokers for both taxable and retirement accounts are:

  • Scottrade: Primary stock broker, $7 per trade;
  • Zecco Trading: Speculative money, $0 commission;
  • TradeKing: Main broker for dividend paying stocks, $4.95 per trade;
  • E-Trade Global: For stocks listed in Hong Kong only, about $40 per trade;
  • QQQDirect: For QQQQ only;
  • ComputerShare: For DRIP stocks only;
  • Fidelity: 401(k) accounts;
  • Vanguard: Roth IRA accounts;

Still a large number, but each has it own unique use. So I will keep all of them for now.

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5 Responses to “Transfer Broker Account From Firstrade To TradeKing”

  1. MoneyNing |  Dec 04, 2007 at 6:08 pm

    I look forward to hearing your thoughts since I am thinking of whether I should move my assets away from ETrade if another brokerage is just as good. :)

  2. NCN |  Dec 04, 2007 at 9:10 pm

    I use tradeking for my roth (and my wife’s)…
    I like their interface – be sure to go in and turn on
    “real-time” quotes…
    NCN

  3. Tradeking Review |  May 27, 2008 at 4:27 pm

    I too focus on the commissions when I sign up with a new broker.

    All I really need are two things: limit trades and low cost. I use my Fidelity account to conduct all my research, then buy everything with the low cost broker.

    It saves a ton of agony and money in the long run. I’ve never been with FirstTrade, but I guess they are second to Tradeking!

  4. Sun |  Aug 19, 2008 at 12:43 am

    Daniel: The $50 account transfer out fee seems to be universal. Though nobody charges any fee when transferring in an account, everybody charges a fee when you want to get out and $50 is pretty standard.

    I have used Firstrade to make a few trades and from my experience, I didn’t notice any difference in how the order is executed.

  5. daniel |  Aug 18, 2008 at 11:54 pm

    First of all, they charge extra for extended hour trading. $6.95 is only from 9:30am to 4pm.
    Second, they claim no fee tranfer in and termination, but they charge transfer out fee of $50.
    Third, they don’t use direct trading or routing. They use a clearing house to take their order. That mean you place an order to firstrade then they place your order to a clearing house. You have to wish clearing house execute your order in time.