TradeKing Review: An Investment Broker with Low Costs

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Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality and will make a positive impact in your life. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print understand what you are buying, and consult a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time. Please do your homework and let us know if you have any questions or concerns.

tradeking review

TradeKing is an investment brokerage firm, founded in 2005. In 2016, Ally acquired TradeKing. Today, TradeKing is called Ally Invest.

Existing TradeKing clients can move their accounts over to Ally Invest by visiting a special account migration page set up by TradeKing.

tradeking review

Image credit: Ally

For new investors who did not previously have an account with TradeKing, determining if you should work with the integrated companies requires looking not just for a TradeKing review but also for an Ally Invest review.

Fortunately, you can read on to find out all about the features offered by Ally Invest and TradeKing so you can decide if investing with this online broker is right for you.

TradeKing review: A great choice for beginning investors

TradeKing was previously a great choice for beginning investors and Ally Invest continues this tradition by allowing investors to open a self-directed account with no minimum balance.

Ally Invest also offers managed portfolios. While you don’t need a deposit to open a managed portfolio account, you need at least $2,500 to begin investing. Ally recommends a professionally-designed portfolio tailored to your needs.

If you open a self-directed account, you’ll need to make the decision about which assets to buy.

How much does it cost to invest?

There is no fee for having an account open with Ally Invest. However, you pay fees when you buy or sell assets. You also pay advisory fees if you use Ally’s managed trading service.

The annual advisory fee for managed investments is 0.30 percent of the value of assets managed. Ally indicates the industry average annual advisory fee is 1.02 percent.

When you have a self-directed account, you may purchase different kinds of investments such as stocks, exchange-traded funds (ETFs), options, and bonds. There is a fee for purchasing each of these different types of investments:

  1. Stock and ETF trades cost $4.95. Stocks are shares of companies while ETFs are baskets of securities that pool your money with others and invest in different kinds of assets.
  2. Option trades cost 65 cents. Options are contracts that give you the right, but not the obligation, to buy or sell assets at a set price.
  3. Bond trades cost $1 per bond with a $10 minimum. Bonds are debt securities that allow you to invest in a company or government’s debt.
tradeking review

Image credit: Ally

Ally’s fees are lower than the costs charged by many competitors. For example, Scottrade charges $6.95 for trading stocks and ETFs online, as well as 70 cents per options contract and $38 for listed corporate bonds.

How can you open an account?

Existing TradeKing users can migrate their account to Ally. New investors can open an account by visiting ally.com/invest, and selecting whether to open a self-directed or managed account. A self-directed account is one you manage on your own, and a managed account is handled by an investment manager.

If you click on “Open Account” to open a self-directed trading account, you’ll be taken to a window asking if you already have an Ally account. If you do, you can log in with your existing credentials. If you don’t, you’ll need to open a new account by providing your full legal name and an email address.

tradeking review

Image credit: Ally

Next, you will choose if you want to open an individual account, a joint account, or an Individual Retirement Account (IRA). An IRA is a tax-advantaged retirement account that you may invest up to $5,500 in with pre-tax funds as of 2018.

After selecting your account type, you will be asked to provide:

  • Your address and telephone number
  • Your Social Security number
  • Information about your employment and financial status

Once your account is opened, you can fund your account from Ally’s website and use their browser-based system to explore investment options and to buy and sell securities.

How does investing with TradeKing at Ally Invest help you?

Because Ally Invest has no minimum balance requirements for opening an account, those who want to invest but who don’t have a fortune can get started small and work up to growing their account balance.

Ally’s low-cost structure also makes it a great option for investors who may not make large stock purchases. The smaller your purchase, the more fees eat away at potential gains. With Ally boasting some of the lowest fees of all online brokerages according to Credit Donkey, you won’t have to worry that big commissions will eat away at your profits.

Pros and cons of investing with Ally Invest

Low cost is one of the biggest reasons why investors choose Ally Invest, but it is not the only reason. Ally also offers 24/7 access to brokers who can answer questions, as well as an investing education center that is free to all account holders. Investors can see real-time streaming stock quotes and access live news, and can also use custom charts and interactive calculators to track progress and set goals.

tradeking review

Image credit: Investor Junkie

One big downside, however, is Ally’s investment options do not include trading fee-free mutual funds or ETFs. This means if you want to invest in ETFs or mutual funds, you would have to pay a fee to the fund manager. Higher fees mean you must invest more or earn higher returns to end up with the same gains as you would have received with a low-fee or no fee investment.

The absence of any physical branches you can visit for help could also be another drawback, as Ally is an online-only bank and brokerage firm.

Contact TradeKing and Ally Invest

If you are considering investing with TradeKing now that the company has become Ally Invest, you can visit the investment broker’s website at ally.com/invest. There is also 24/7 phone support at 1-855-880-2559 or you can email support@invest.ally.com.

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Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality and will make a positive impact in your life. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print understand what you are buying, and consult a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time. Please do your homework and let us know if you have any questions or concerns.