Update: May 2017. TradeKing has been acquired by Ally Bank and is now known as Ally Invest. Ally Invest offers the same great pricing and features as TradeKing, and also offers the ability for customers to link their account to their Ally Bank savings account. This merger gives customers a convenient way to have two best of class financial services under one roof!
I first opened a TradeKing account almost 10 years ago. Since then I have been happy with the ease of use, features, and low costs they offer customers. Ally Bank, one of the best in class online banks, recently purchased TradeKing, one of the top-tier online brokerage firms. The merger was recently finalized. The new platform is called Ally Invest. And I’m excited to see where the rebranded trading platform goes.
Several years ago I was searching for a low cost brokerage so I could invest in some individual stocks. After comparing multiple discount brokers, I opened a TradeKing account. My decision was based on TradeKing’s low prices, services, features, education center, and industry level awards. In short, just about everything your would look for in a financial services company. This TradeKing review covers the major features at TradeKing, my personal opinions, and some videos which help show TradeKing’s features.
Ally Bank Review – Award Winning Brokerage
Ally Invest inherited a strong legacy when they acquired the TradeKing brand. TradeKing consistently ranked as one of the top rated online discount brokers by several major third party financial companies, and they won numerous industry awards. Here is a sampling of the recognition TradeKing has received in the past few years:
- 4 stars from Barron’s “Best Online Broker” review for the 7th straight year (every year since 2007!)
- #1 online broker for usability in 2011
- Distinguished as one of the “Best for Options Traders,” receiving high rankings for its options trading tools and competitive options pricing.
- Named one of the “Best for Long-Term Investing,”
- #1 in customer service in 2008, 2010, and 2011 annual rankings
- #4 overall in 2011 annual rankings (#1 overall in 2006 and 2007).
Opening an Ally Invest Account
Opening a Ally Invest account takes about 15 minutes, depending on how quickly you can read the terms and conditions. Like all brokerages and other financial institutions, Ally Invest requires new account holders to enter the standard personal information such as name, address, SSN, employer information, trading experience, financial information, etc.
One thing I noted during the application process was a Ally Invest security feature – the use of a virtual keyboard for entering your password and for logging in to the system once your account is open. This is similar feature to the PIN number on ING Direct accounts and the keyboard login for the Thrift Savings Plan and is designed to prevent key-logging software from recording your password. Added security is always welcome in my book.
Ally Invest – Investment Options, Pricing, and FEatures
- mutual funds
- exchange–traded funds (EFTs)
- U.S. Treasury and Agency Issues
- and even FOREX (foreign currencies)
- Ally Invest also features a no-fee IRA.
Commissions. Ally Invest is among the industry leaders for lowest commissions. For Stock and ETF trades, Ally Invest charges $4.95 per trade. Ally Invest recently decreased their commissions for those who buy multiple options contracts. The current pricing structure is $4.95 base + $.65 per options contract for the first 8 contracts, and $8.95 base + $0.15 for more than 8 trades. This can work out in investors favor big time. For example, a single option trade of 25 contracts used to cost $21.20, but now only costs $12.7o, or a savings of 40%.
Fee schedule. Ally Invest is an online only company, and one of the methods for reducing costs is reducing physical paperwork. As such, there is a $2.50 fee for paper statements. With almost everything being electronic nowadays I don’t mind passing on the paper statements and relying on e-mail and my printer.
Transferring money. Ally Invest allows investors to link an account to their Ally Invest account to transfer money via ACH transactions. It is important to note that ACH deposits are subject to a trading hold of 5 business days, and cannot be withdrawn for 10 business days. This might make you miss out on a hot idea if you aren’t prepared and already have your money in your account. You can only link one bank account to your Ally Invest account, so it is recommend to do some planning before you open your account.
Dividend reinvestments. Ally Invest offers free automatic dividend reinvestments (DRIPs), with the ability to purchase fractional shares. Investors have the ability to apply automatic dividend reinvestments to all stocks in their portfolio, or select stocks. This is an attractive feature.
Money Market Sweep. Ally Invest gives their account holders the option of placing their uninvested money into a sweep account where they can earn interest (the rates change based on market conditions). It’s important to note that for this to take effect, you will need to contact customer service after setting up your account. The funds are FDIC insured.
Trading Stocks at Ally Invest
Making trades at Ally Invest. The Ally Invest platform is both intuitive and robust. Ally Invest’s trading interface allows investors to perform multiple transactions from the same page, meaning you can set up covered calls, puts, spreads, straddles, and other trading options from the same screen. This is more advanced than my current needs, but will come in useful to many traders. This video will show you how to make a trade on Ally Invest. Ally Invest also has an extensive selection of tutorials and videos to help you if you ever get stuck (see learning center, below).
Ally Invest iPhone, iPad, and Android Apps
Ally Invest currently offers smartphone apps for the iPhone, iPad, and Android. These apps allow you to check your account activity, trade stocks and options, perform research, track stock news, and more. They also feature a mobile optimized site if you prefer using a standard web interface. You can check out the Ally Invest iPhone and Blackberry apps here.
Ally Invest’s Investment Research and Learning Center
Investment Research. The Ally Invest platform features online equity, options and fixed-income trading tools including real-time portfolio information, advanced order entry, customized charting and alerts, free research and integrated news, stock, option and mutual fund screeners, volatility charts, a pricing probability calculator, enhanced option chains and interactive educational information.
Learning Center. Ally Invest’s Learning Center offers tutorials on a number of investing topics. The Learning Center utilizes a variety of different media, including articles, blogs, free live webcasts and webinars, podcasts, video tutorials, calculators, tools, e-books, newsletters, and links to external resources. Just about any kind of information anyone needs can be found inside the Learning Center or through one of its external sources. The learning center is accessible to everyone, regardless of whether or not you have a Ally Invest brokerage account.
The Ally Invest Community
The Ally Invest community is well organized and well run. It features a blog and forum section where members can trade notes and ideas and learn from each other. Members can track recent trade activity and trade notes from those who are willing to share some insight as to why they made a trade. They can also join Ally Invest community groups which are organized and run by Ally Invest members. There are quite a few groups, including those for beginning investors, options traders, and those who prefer to specialize in different types of investments including value stocks, penny stocks, ETF’s, hedge funds, dividend stocks, and various segments of the market such as automotive, biotech, or individual companies.
Other features at Ally Invest
Maxit Tax Manager. Ally Invest features the Maxit Tax Manager, a cost basis and tax reporting tool that tracks gains, losses, and other information to help you with your taxes. This tool makes it easy to monitor your monitor your realized and unrealized gains, identify wash sales, and calculate other potential tax implications. Maxit Tax Manager is FREE to Ally Invest customers.
Account Records. Ally Invest maintains records for account holders, including trade confirmation reports, monthly or quarterly account statements, and tax documents such as 1099 forms. Account records are stored online and can be downloaded into a .pdf format, or Quicken, Microsoft Money 2007, or Excel. The account records are nice because Ally Invest charges for paper statements.
Ally Invest and CoolTrade Partnership. Ally Invest recently partnered with CoolTrade™ to offer Ally Invest customers access to automated stock trading. This capability is avilable in the Ally Invest trading platform and givesAlly Invest clients the ability to make fully automated stock trades for one, low per-trade cost (the standard rate of $4.95 per trade). There is a monthly subscription for this service, which is aimed at professional level traders.
How Does Ally Invest Compare to Similar Brokerages?
Ally Invest Customer Service
TradeKing won multiple awards based on their customer service support, including the #1 rankings for in customer service in 2008, 2010, and 2011 Smart Money Magazine annual rankings. Hopefully this level of support should onctinue with the transition to Ally Invest. Customers can contact the customer service department via Online Chat, Email (firstname.lastname@example.org), or telephone 24/7 at 855-880-2559. My experience with Ally Invest’s customer service has been excellent.
Ally Invest Promo Codes
TradeKing was well-known for offering several sign up bonuses, referral bonuses, and other deals throughout the year. The most popular offer was their $50 cash bonus, which usually came out once or twice a year. They have even gone as high as a $100 cash offer, but I have only seen that offer one time. We will have to wait and see if Ally Invest will offer similar promotion codes and offers. You can find current Ally Invest Promo Codes here.
Ally Invest Review – Conclusion
Overall, I think Ally Invest offers great value and capability in a low cost, easy to use package. Based on my personal experiences and its award winning ways, I don’t hesitate to recommend Ally Invest if you are searching for a new brokerage firm.