E*TRADE Review 2023 (2024)

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About E*TRADE

E*TRADE is an online brokerage offering a wide selection of account and investment options geared mainly for hands-on investors and small businesses. That said, passive investors can also benefit from E*TRADE's automated Core portfolios, as it is one of the best robo-advisors for mobile.

The brokerage is a low-cost option with a $0 account minimum and commission-free trades on US-listed stocks, ETFs, and mutual funds. But you can also buy and sell mutual funds, bonds, CDs, IPOs, and futures. If you're new to investing, E*TRADE has a plethora of interactive charts, over 100+ technical studies, market trackers, and more educational content.

You'll get access to advanced charting tools and investing features such as paper trading accounts, portfolio analyzer, portfolio rebalance tool, and more. Plus E*TRADE allows margin trading, which comes with its own array of margin calculators and analyzer tools. But it doesn't offer tax-loss harvesting features.

E*TRADE's mobile app is available on iOS and Android devices.

Is E*TRADE Right for You?

E*TRADE is a financial services firm providing online brokerage, retirement, and investing services for retail investors and traders. E*TRADE offers IRAs, brokerage accounts, small business retirement accounts, managed portfolios, automated portfolios, and more.

E*TRADE's Core portfolios (aka the brokerage's robo-advisor) are best for long-term-focused, hands-off investors who have a time horizon of at least one year.

The brokerage is a great choice for mutual funds, as it offers more than 6,000 transaction fee-free funds. But you'll need at least $500 for robo-advice, and its 0.30% robo-advisory fee isn't as competitive as similar platforms.

E*TRADE: Overall Rating

E*TRADE Pros and Cons

You can't invest in crypto directly with E*TRADE, but you can invest in crypto-linked stocks and ETFs.

Is E*TRADE Trustworthy?

Personal Finance Insider factors in Better Business Bureau ratings when assigning "ethics" ratings and the Better Business Bureau has given E*TRADE an F in trustworthiness. This means that the BBB currently has received the lowest possible score.

However, the bureau also says on its website that its ratings don't guarantee a company's performance or reliability, so it's best to do your own research as well.

The Financial Industry Regulatory Authority (FINRA) alleged that E*TRADE did not have adequate safeguards to prevent manipulative trading on stocks and futures from December 2016 to 2021. In 2022, E*TRADE agreed to pay FINRA $350,000 to settle the claims.

In 2021, E*TRADE — along with Robinhood, Webull, and TD Ameritrade — restricted trades on Gamestop (GME) and AMC Entertainment (AMC). These were two stocks that saw significant share price surges after members of a Reddit forum known as r/WallStreetBets collaborated to drive up the share prices. But like Robinhood and the others, the investment app eventually lifted its trading restrictions on the stocks.

Ways to Invest with E*TRADE

Self-Directed Brokerage Accounts

With an E*TRADE self-directed brokerage account, you can trade without any account minimums or commissions on stocks, ETFs, and options. E*TRADE provides three free trading platforms: Power E*TRADE, E*TRADE Web, and E*TRADE Pro.

You'll also have access to a wide selection of mutual funds, futures, bonds, IPOs, and certificates of deposit (CDs). E*TRADE offers roughly 6,000 mutual funds.

E*TRADE also gives minors investing access through its custodial brokerage accounts. Parents or designated custodians can manage these accounts, and they come with $0 commissions, tax advantages, and investment education tools.

Core Portfolio Automated Accounts

If you're a passive investor or fan of automated advice (aka using a robo-advisor), E*TRADE's Core Portfolios could be right for you. These accounts — though more expensive than the standard brokerage accounts — provide personalized and automated portfolio management.

The E*TRADE Core Portfolios account uses one type of investment: ETFs. The brokerage uses asset classes that strive to generate high returns over the long haul (usually a minimum of three years), and it gives you the option of socially responsible ETFs or smart beta ETFs (smart beta ETFs are funds that aim to outperform the stock market).

In addition, E*TRADE says it selects ETFs by analyzing things like historical performance, liquidity, tracking error, and expenses.

For instance, E*TRADE automated investing offers specialized portfolios for goals such as wealth-building, retirement-saving, or buying a home. You'll need at least $500 to set up the account, and you'll pay an asset-based annual fee of 0.30%. The Core Portfolios account draws from the combination of automated technology and oversight from E*TRADE experts.

Its $500 minimum requirement is reasonable but higher than other popular automated accounts (e.g., SoFi Automated Investing, Ellevest, and Betterment) that require $0 or $1 to get started. But one thing to look out for is that you won't be able to access one-on-one advisor guidance. You can do so with the Blend Portfolios account option, but you'll need at least $25,000 to get started.

As for account type eligibility, individual, joint and custodial brokerage accounts qualify for Core Portfolios. Rollover IRAs, Traditional IRAs, Roth IRAs, and SEP IRAs are also eligible. You can also adjust your risk tolerance — and add or remove specific investing focuses — at any time.

You can set up Core Portfolios on iOS or Android devices.

Managed and Prebuilt Portfolios

If professional advice from human advisors sounds good to you, then E*TRADE's managed portfolios might just suffice. E*TRADE offers three fully managed portfolios:

• Blend Portfolios
• Dedicated Portfolios
• Fixed Income Portfolios.

Each account allows you access to financial consultants who tailor your portfolio to your specific preferences and goals, but the minimum account size requirements differ. Account minimums for these portfolios range from $25,000 to $250,000.

E*TRADE additionally offers pre-built portfolios of mutual funds or exchange-traded funds. These portfolios come without commissions, and they employ conservative, moderate, and aggressive investment strategies. To set up the account, you'll need a minimum of $500 for mutual funds, or $2,500 for exchange-traded funds.

Retirement Savings Accounts

E*TRADE also provides retirement savings accounts for its users. You can take advantage of several IRAs, or even roll over your 401(k) or employer-sponsored retirement plan. E*TRADE also offers the option to open retirement accounts online, by phone, or by mail.

Its retirement accounts include the following: rollover IRAs, Roth IRAs, traditional IRAs, beneficiary IRAs, E*TRADE Complete IRAs, and IRAs for Minors.

An E*TRADE Complete IRA is a retirement account for investors older than 59 1/2. You must have an existing E*TRADE IRA to open a Complete IRA. Plus, you can make penalty-free withdrawals at any time.

Coverdell ESA

The E*TRADE ESA allows you to set aside funds for your child for kindergarten through graduate school. You can make annual contributions of up to $2,000 with the account, and you can also use federal tax-free withdrawals on qualified education expenses.

You can sign up for this account as long as your income is below $110,000 (for single filers) or $220,000 (for joint filers).

E*TRADE also gives minors investing access through its custodial brokerage accounts. Parents or designated custodians can manage these accounts, and they come with $0 commissions, tax advantages, and investment education tools.

E*TRADE Client Base

E*TRADE's services are available to active and passive investors, registered investment advisors (RIAs), stock plan participants, and stock plan administrators.

When it comes to RIAs, E*TRADE serves these professionals two ways — through Liberty, its custodial platform, and the E*TRADE Advisor Network. The Liberty platform allows advisors to manage clients' accounts, and the E*TRADE Advisor network uses referrals to connect independent advisors with prospective clients.

Investment Options

With E*TRADE, you can invest in US-listed stocks, bonds, mutual funds, ETFs, options, futures, IPOs, and CDs. There are commission-free trades on stocks, ETFs, and options. Also, a majority of mutual fund trades have no trading fees.

E*TRADE Fees

An E*TRADE self-directed brokerage account, including retirement account options, doesn't require any account minimum to start investing. However, E*TRADE Core Portfolios require a $500 minimum to open an account. Account minimums for managed portfolios range from $25,000 to $250,000.

Bond trades will cost you $1 per online secondary trade, and E*TRADE charges up to $0.65 per options contract ($0.50 if you make 30 trades per quarter). Futures contracts are $1.50 per contract.

Core Portfolios have a flat annual advisory fee of 0.30%.

Core Portfolios Account Setup and User Interface

The account setup process is pretty simple with Core Portfolios. E*TRADE asks you a series of questions about your goals and preferences, and its algorithm creates a personalized ETF portfolio that aligns with your risk tolerance.

The first question — which asks about your investing goals — gives you three options: simply build wealth, save for retirement, or target a specific goal (you can adjust your goals, investment timeline, or risk level at any time). Core Portfolios then asks how much you plan to invest initially.

To learn more about your risk level, E*TRADE provides a graph showing the hypothetical returns of a $100,000 investment.

As indicated above, the best case one-year returns for a $100,000 initial investment would be roughly $124,000.

E*TRADE — Frequently Asked Questions (FAQs)

How E*TRADE Compares

E*TRADE vs. TD Ameritrade

Both E*TRADE and TD Ameritrade are best for all types of investors since each brokerage offers a wide selection of self-directed brokerage accounts, managed accounts, IRAs, and other wealth-building products.

However, TD Ameritrade no longer offers its managed accounts to new customers (due to the Schwab acquisition), but E*TRADE still allows new clients to sign up for its Core Portfolios automated account. You'll have to set up an automated account through Charles Schwab if you choose to open a TD Ameritrade account.

E*TRADE vs. Betterment

If you're solely set on automated advice, Betterment could be an even better (and less expensive) option. Not only does its digital plan have a $0 minimum requirement and 0.25% fee, it also offers socially responsible portfolios, crypto portfolios, and multiple other portfolio options.

E*TRADE caters to more types of investors, though, since it gives you a wider range of account options and investment types to choose from. You'll be limited to automated investing with Betterment.

Why You Should Trust Us: How We Reviewed E*TRADE

We examined E*TRADE investing appusing Personal Finance Insider's rating methodology for investing platforms to compare and examine account types, pricing, investment options, and overall customer experience when reviewing investing platforms. Platforms are given a rating between 0 to 5.

Investing platforms generally offer multiple assets, trading tools, fees, and other resources. Some investing platforms are better for more advanced investors or active investors, while others may better suit beginner investors and passive investors. E*TRADE was evaluated with a focus on how it performed in each category.