Firstrade Review
Trading platforms that offer low costs and are above the average
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Fast Facts:
Account Minimum: $0
Fees: $0 commissions on most stock, option and ETF trades
Best for: Low-cost trades
Our way
Firstrade Securities was established in 1985 in Flushing, Queens. It was a local business that served the needs of immigrants from China and other ethnicities. Firstrade, a low-cost leader, has kept its roots intact, offering trading tools and support in both simplified and traditional Chinese.
Firstrade recently switched to $0 commissions on stock and option trades. However, this comes with some compromises in tools, research and product scope. Firstrade, however, is an acceptable choice for active stock and option traders who want a streamlined order entry with advanced options spread trading and rock-bottom costs.
Overview
Firstrade offers low fees and a unique securities lending program that allows investors to earn extra income by lending their stocks out to other financial institutions. Securities lending does not place restrictions on account holders who may sell their stock at any time. Independent investors who have large accounts could see this as a huge benefit.
Pros
Trade options and stock at $0 with many ETFs or mutual funds that have no transaction fees
A seamless trading experience, which is consistent across mobile platforms and desktops.
English and traditional Chinese accounts are supported.
Cons
Web and mobile platforms have limited functionality beyond order entry and rudimentary chartsing.
Forex, crypto, futures or futures options trading is prohibited
Customer support is not available 24/7
Rating of the company overall
Reliability ⭐⭐⭐
Platform ⭐⭐⭐
Commissions ⭐⭐⭐
Support ⭐⭐⭐
Financial instruments ⭐⭐⭐
RATING: 3
Trading Experience
Firstrade's platforms, when compared to other online brokers are simple but functional. Even for complicated spread orders, order entry is easy and intuitive. Spread legs can be manually entered and an integrated chainsheet makes it easy. Margin is calculated when trades are built, but streaming quotes may not always be available in the order entry form. This requires that you refresh the page to verify the price. Manual order entry can be tedious for very active traders.
Complex order types such as OCO and OCA, are not available on the web or mobile platform. However, the advanced "Navigator” application could be used to open or close trades. Although it is easy to place an order using most of the screening tools, such as ETFs or mutual funds, the order entry interface for each product is not consistent. It is not possible to trade directly from charts, or create baskets and staging orders.
Trade Technology
Firstrade Navigator is its new all-in-one trading platform. It was created for more active traders and features a single page layout that includes modules. Navigator can only be accessed by desktop users who have "applied" via email. Although the process of accessing the platform was complicated, users can access it via the App Store on their iPads without having to apply. The web-based Navigator as well as the mobile platforms offer streaming quotes and real-time information. Firstrade is a great choice for smaller traders if they are looking to reduce commission costs.
Before choosing Firstrade to be your broker, more experienced traders or those with larger trading volumes may need to consider some additional factors. Firstrade doesn't offer spray-routing or provide data on price improvements for orders. Firstrade routes orders to Apex and Credit Suisse and accepts payment for this order flow. This is a popular practice among low/no-commission brokers. However, it is controversial and puts the broker in an awkward position trying to get the best price possible for their clients and maximize income for order flow.
Useability
It is very easy to set up an account. All account forms must be understood and read by traders, but most of the blanks have been prefilled. Account and margin approvals are quick and easy for the average trader. Account support is available in simplified or traditional Chinese for traders who are based in the U.S.A or other approved markets.
It is easy to navigate the web-based trading pages and account management pages. Orders can be placed from any location on the site or mobile app. No matter where you are on the site or platform, menus are easy to use and remain consistent. Navigator allows you to customize the platform by allowing you add, remove or drag modules to other places on your screen. The functionality of the Navigator platform and mobile platforms is excellent. They use MultiCharts (TradingView), so it's very easy to customize. The charts do not integrate with order entry or account management.
Mobile and Emerging Tech
Firstrade's mobile app, like the web-based and Navigator platforms is intuitive and simple to use. The order entry feature includes stop, limit and market orders. However, advanced order types such as OCO or OCA can only be accessed through the Navigator app on iPad. MultiCharts (TradingView), which are fast and robust, but do not allow trades from chart functionality, were included in the mobile app.
The mobile app's order entry and watchlist features are seamlessly integrated with the Navigator platform and web-based. The mobile app does not offer streaming news or analysis from Morningstar, Briefing.com and Benzinga. There are also no other research tools or screening tools.
A wide range of offerings
Firstrade provides trading access to stocks and options as well as fixed income. This is what small retail traders most likely need. There are enough ETFs and mutual funds that don't charge transaction fees to cover all asset classes. The web-based platform makes it easy to access the fixed income order pages as well as screening tools, which is a big advantage over low-cost brokers.
Firstrade may not offer certain key services for more advanced traders. Futures and options for futures are not offered. Forex and cryptocurrencies trading is not available. Firstrade currently does not offer robo-advisory services. Spread order entry is available for advanced traders and active options traders and can be used for up to four spread legs.
News and Research
Firstrade offers a surprising amount of research and screening tools throughout its trading platforms. Although the fund and stock screener is simple to use, it is not intuitive and has limited functionality. The screeners are quick and easy to use, provided that traders have minimal screening requirements. Traders have access to news and analysis via Morningstar and Briefing.com. Both are high-value sources. Benzinga.com also streams news of lower quality.
OptionPlay can be used by traders to generate and analyze options trades and spreads. This feature, while useful, is difficult to find. It can be accessed via the options chain sheets. Firstrade's charts are of variable quality depending on which platform they are hosted. The web-based platform provided basic charting, which is not easy to use and cannot be customized. Mobile trading platforms and Navigator use charts from MultiCharts (TradingView), which are excellent.
Portfolio Analysis and Reports
Firstrade's platforms do not offer most of the accounting and portfolio analysis functions. Investors can view margin requirements per trade and keep track of open positions or watchlists. You can also view your account balances and history in real time. Transactions can be downloaded to aid analysis using external tools.
The process of downloading account activity data to external programs such as Quicken, Microsoft Money or Excel is simple, but there is no functionality within Firstrade for tax planning and account management. Although there are some basic calculators that can be used to calculate asset allocation, option pricing, and IRA contribution, they are not integrated with your account and provide no guidance or analysis.
Customer Service and Support
Firstrade doesn't offer 24/7 live chat support but they have two distinct qualities that make them stand out from other brokers in the same category. First, they provide full support in both simplified and traditional Chinese. Firstrade's customer support is available during market hours and can be reached by phone at any time. Accounts can request a callback during heavy call times. This was extremely fast in our tests. Chat responses were less satisfactory. Many chat responses were generated automatically and included links to FAQs that didn't often relate to the question being asked.
Firstrade offers low fees and excellent telephone service. They can also help account owners generate income from stock holdings via a stock loan program. Firstrade allows traders to loan their shares to institutional investors for daily income. The shares that have been borrowed are not restricted and investors can still buy and sell them just like they would normally without being part of the stock loan program.
Education
Firstrade offers articles and videos on a wide range of markets and trading strategies. The material is intended to provide an introduction to the majority of topics for new investors. Videos and articles are often produced by outside companies or organizations such as the Options Industry Council. They do not contain education that is timely or directly related to Firstrade's tools and platforms.
We found many dead links and dated content in the educational content during our review. While introductory education is useful for new investors, it doesn't relate to current market conditions or new trading innovations. Live webinars and live events are not available, which could have filled in some of the gaps in education. Podcasts are also available but they are often provided by the same providers and don't relate to the market environment.
Prices
Firstrade traders are likely to be looking for the lowest-cost broker and minimal trading functionality. You can trade stock, options, and funds for as little as $0 in commissions. Security lending can even lower trading costs by compensating account holders who lend their shares to generate daily income.
Low-cost brokers may not offer the same functionality or services as high-end brokers. However, they will charge higher fees for other areas in order to compensate for their lack of commissions. Firstrade charges investors who have a margin account higher margin rates than the average. Some account transactions such as wire transfers or ACAT transfers out are more expensive than the average, but they are not unusual.
What you need to know
Firstrade is an option if investors are focused on low trading costs. Investors looking for options, stocks, funds, or crypto trading are not advised to go with Forex, futures, or crypto trading. Firstrade is a broker that charges low to no commissions, but stands out from the rest with its superior trading platforms, streaming quotes and advanced options trading functionality.
The service is limited to market hours and may prove difficult for foreign traders or new investors. Investors looking for education will find plenty of information from both internal and external sources, but not much in the way of advanced education or guidance.