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Updated on Monday, April 29, 2019
SpeedTrader is an online broker that caters to active day traders. It offers a choice of platforms and a full selection of research and data tools, making it a competitive option. You also get direct market access with more than 25 routing options, a choice of per-share or per-trade pricing, and the ability to trade Stocks, Options, and Bonds.
However, SpeedTrader has a higher minimum deposit requirement than TradeStation and Lightspeed, which are designed for active traders as well. SpeedTrader doesn’t offer as many options for trading platforms as Lightspeed does, and you won’t have access to multiple free trading platforms with SpeedTrader — unlike with either of its close competitors.
Who should consider SpeedTrader
If you’re a day trader who needs real-time market data at your fingertips with the ability to place and execute orders as quickly as possible, then SpeedTrader could be an ideal broker for you. SpeedTrader allows you to save multiple screen layouts, create customized watchlists, stream quotes in real time, manage multiple trading accounts in one platform, and customize 100 different hot key options for the fastest possible order entry.
SpeedTrader also provides support for institutional clients, including hedge funds. Or if you are diving into day trading for the first time, you can request free virtual practice accounts with virtual buying power to make sure you’re ready before you risk any real money.
But if you’re looking for features that cater to hands-off traders, such as commission-free ETFs, no-load Mutual funds, or robo-advising services, SpeedTrader is the wrong tool for you. Online brokers such as Ally Invest, Charles Schwab and E-Trade would be more your speed.
SpeedTrader fees and features
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Strengths of SpeedTrader
Some of the key benefits of SpeedTrader include the following:
- Affordable commissions: With SpeedTrader, you have a choice of how the commissions are structured. You could pay a per-trade fee as low as $2.95 if you make 500 trades or more per month or up to $4.49 per trade if you trade less frequently at under 200 trades in a month — or you could pay a per-share fee instead. Per-share fees start at just $0.0025 if your monthly share volume is at least 500,000 and goes up to $0.0044 if you trade under 250,000 shares. This is comparable to Lightspeed, which charges $0.0045 if you trade under 249,999 shares per month and as low as $0.0010 if you make 15,000,000 or more in trade volume per month. And it’s below TradeStation’s pricing of $5 per trade.
- Tools to facilitate timely ordering: SpeedTrader is focused on allowing you to place orders as quickly as possible. That’s why you have direct market access with a choice of routing options as well as hot keys to facilitate trades. Most conventional brokers don’t offer direct market access, instead routing customer orders to centralized trading desks, which in turn route to other liquidity providers.
- Advanced data, charting and research tools: SpeedTrader has multiple platforms, each of which offers customization and advanced tools to help active traders. Investors can create customized watch lists; view streaming quotes as well as time and sales data in real time; and choose from a full array of chart types, including candlestick and price charts.
Drawbacks of SpeedTrader
- High minimum deposit requirements: SpeedTrader offers only margin and options accounts, and there is a minimum $30,000 deposit for U.S. and foreign clients. There is also a minimum $30,000 deposit if you want to open a day trading account.
- Costly inactivity fees: There is a $30 inactivity fee per quarter if you execute less than 15 trades.
- A lack of options for free trading platforms: Lightspeed offers two free trading platforms, while TradeStation doesn’t charge software fees and provides free access to its advanced trading tools. SpeedTrader, on the other hand, charges a minimum of $25 monthly for ActiveWeb unless you generate at least $199 in monthly commissions. And its other platforms are even costlier, with SpeedTrader Pro Level I starting at $49 monthly unless you generate $199 in commissions and SpeedTrader Pro Level II coming in at $104 per month if you have less than $499 in monthly commissions.
Is SpeedTrader safe?
SpeedTrader is committed to account security. It is in full compliance with all regulatory requirements, according to FINRA BrokerCheck. And client assets held with SpeedTrader are insured up to $500,000 since SpeedTrader is a member of the SIPC.
SpeedTrader clients also get additional protection through Lloyd’s of London for up to $24.5 million in assets. That means a combined total of $25 million per client is protected, including up to $1 million in cash.
This insurance does not, however, protect you if the assets you invest in lose value. There are inherent risks to investing, and you could end up losing money if your investments perform poorly.
SpeedTrader, more than most other online brokers, focuses on facilitating the fastest ordering speeds possible, which is a big benefit for day traders. If speed is of the essence, SpeedTrader is likely the right choice for you. But if you’re looking for a wider choice of trading platforms and are interested in not paying a fee to use them, then you may want to consider Lightspeed or TradeStation instead.