Some of you may remember my first foray into investing. It was an half thought out idea that was, in hindsight, quite stupid. As a result of that I have been working towards a more sane and economical approach to getting some non-retirement funds invested into the markets. I am by no means a day trader or speculator. I just don’t have the knowledge or expertise to start throwing wads of cash at individual companies. So my main goal was to find a company with some decent No Transaction Fee (NTF) mutual funds. Enter Scottrade.
About the Company
Since 1996 Scottrade has been offering online trading to its customers. With over 350 branch offices they are both an online and person kind of shop. As a discount brokerage with a focus for online investing they offer an easy to use online trading platforms for idiots like me. In addition to the simple platform they offer ScottradeElite for true active traders. I am no active trader so their simple interface is all I use. They also offer a mobile site, not to mention that they have local branch offices.
Why I Chose Them
I had initially decided to open an account with Sharebuilder because they had a good automatic investment “plan” that would automagically pull money from your checking account and invest it in your stock/fund of choice. The problem with that was every time I invested my $100 they were going to charge me $4. It was brought to my attention that No Load/No Transaction Fee fund may be the better option for investing minimal amounts of cash. Looking into it I found some decent funds on Sharebuilder but they all required at least $1,000 initial investment. Scottrade on the other hand only required $500 to open an account and their minimum initial investment for a NTF fund was $250. Obviously it works better for me and my piddly amount of cash to go with Scottrade.
Opening an account with Scottrade was relatively painless. In fact it was a lot like opening an account an online bank. They ask you the basic kind of questions you would expect to see with your bank and then presto you have an account opened up. One thing was a little bit different was that you do have to pick a local branch who will then send you out some information as well as a request to send in a signature card. Unlike most online bank accounts you actually will have to send something back to them to get full access to your account, I can’t remember what you couldn’t do without one but it didn’t affect me directly.
Using the Account
Using the account was not quite as intuitive as I thought it could be. I had a little bit of a problem trying to find exactly what I was looking for. I wanted to find no load/no transaction fee mutual funds. I went to research and mutual funds but all it let me do was search by symbol. It took me a while to find the mutual fund screener which allowed me to locate no load NTF funds for sale at Scottrade, there were 2915. 2915 was a daunting thing to have to look at so luckily I knew approximately what the symbol was I wanted and zeroed in on my choice. Once I found the fund I wanted buying is was easy as pie. The only thing that I miss about Sharebuilder was the ability to automatically do the investing. I have to remember to go in and buy into the fund when my transfer hits.
So far I haven’t found anything that would make me want to jump ship. Their user interface isn’t the flashiest thing on earth, in fact it is pretty bland but it gets the job done. I have enjoyed it and they make the transfer of funds from bank to brokerage super easy, which is refreshingly nice.
Who do you use for your online brokerage needs?