Let's dive in with this TradeZero review. Looking for a way to get around that pesky PDT rule if you're outside the USA? Want to save some coin in commission fees? Well today you're in luck, we're doing a review of this popular broker. As a result, this just might be the broker you're looking for. Brokers are such an important part of trading because it's the hub in which everything happens. Therefore, you want to make sure you pick the broker that best suits your trading style. Read more below to get the scoop.
Trade Zero is an online discount brokerage firm offering commission free stock trading, free limit order trades, no PDT rule (as long as you are not a US resident), high day trading leverage and state-of-the-art trading software. In fact, they are attractive to active traders looking to keep costs down.
Since they're located in the Bahamas, they don't have to comply with the SEC regulations for Pattern Day Traders. Again, US Citizens: Don't get too excited, because while you can open an account with them, you’ll still be stuck with the PDT rule.
For US citizens there are other options for PDT avoidance. Even if you find your way around the PDT rule, you still need to know the right ways to trade. And not over-trade! (Don't worry, we'll teach you!)
In this TradeZero review, we find that their claim to fame is 100% free limit orders. Of course, like anything in life, conditions apply. Just as long as the limit order is over 200 shares and doesn't create an immediate match, the trade is free. Keep in mind the symbol must cost more than $1 and trade on the NYSE, AMEX or NASDAQ to be eligible.
On the other hand, you pay a $.99 flat fee when buying less than 200 shares. Click HERE to see how the pricing works
What does "unmatched" mean? Well, it means you as the trader must provide liquidity. You do this buy selling/shorting on the inside ask/offer or buying/covering on the inside bid.
Shout out to offshore brokers and their ability to offer high day trading leverage. This can be a catch 22 so consider yourself warned. Margin is a loan extended by your broker that allows you to leverage the funds and securities in your account to enter larger trades.
So, what does this mean for you? Well, margin is based on account size. If you have less than $1000 cash in your account you get zero margin. Cash accounts just under $2,500 receive 4:1 leverage. Now this is where things get interesting, once you have over $2,500 in your account, leverage goes up to 6:1. In laymen terms, with a $5,000 account you can trade $30,000 worth of equities.
Users have a few different options to choose from. According to TradeZero, they're the best on the market. Quite frankly, despite being an offshore platform, the experience is not only smooth but, seamless.
Zero Pro which is their desktop software is $79 per month with level 2 data. Zero Web, the web based platform is $59 per month. If you like to trade while you wait for appointments, their Zero Mobile platform is free!
In fact, if you trade high volumes your monthly fees are waived! Winning! Check out our best brokerage firms page.
Looking for a stand-alone program with precision control and depth? Look no farther than the ZeroPro platform. It provides all the bells and whistles needed for trading. This platform has advanced charting, direct order routing with short-locate request buttons, conditional orders, and options trading just to name a few.
Users of ZeroWeb have direct market access complete with level 2 data and hot keys. In fact, all of these features are mission critical for the active trader.
Since ZeroWeb trading is a browser based platform, it will run on any connected device. All windows update dynamically tick-for-tick and in real-time. As a result, windows can be linked with one another and the layout is totally customizable.
The ZeroWeb Level 2 window includes all market depth, Level 1 information and streaming time and sales. Orders can be placed by pointing or clicking or using advanced hot keys. Check out a list of the top trading companies.
Access your trading account wherever using your iPhone or Android mobile. Trade and locate stocks in real-time when you’re on the move. View real-time streaming quotes, access account portfolio, charts, locate hard to borrow stock, check open orders and execution history. The mobile platform links to THE Pro and web platform. Orders that are sent update dynamically in all platforms (watch us do stock trading live each day in our trading rooms).
For hard to borrow stocks (for example, low float stocks) – They are exceptional! Short-sellers take a deep breath, TradeZero has short-seller access to 14,000 symbols. Yes, I said it, 14,000. Thank the lack of SEC regulations for that.
For those of you who love to short like me, it's a traders dream. Cost wise it will set you back about $0.03 on those hard to borrow intraday shorts. Looking to hold overnight? It's 7x/share cost for the first night and 1x/share cost thereafter.
They have shorts on virtually any hard to borrow stock you can imagine, and of course, you do have a pay a premium to locate these shares (as you would with any other broker).
Because TradeZero offers US market access and clears through a US clearing firm, Trade Zero is subject to Reg NMS. This means firms are obligated to provide investors with executions at the best possible price. As long as you are trading high volume mid caps and large caps, you shouldn't have a problem. Trading low float stocks will always bring execution issues no matter what broker you are using.
Knowing how to use hot keys is vital to success for day traders. The split-second order execution ability determines if you're eating Filet Mignon for supper or ground beef.
In my opinion, the hot keys are the same caliber as Sterling Trader Pro and DAS Pro, both leaders in their field.
Not sure how to use hot keys? Check out our great video here on how they can be used.
TradeZero uses different ECNs to route their limit order through. These ECNs provide a liquidity rebate.
For example, when you place a free limit order trade they route it through EDGX. This allows them to collect the liquidity rebate and pass the trade on to you for free.
Unfortunately, U.S. residents without citizenship in another country will have their application rejected.Don't
Also, there's always risk with your money being offshore. However, according to their website, TradeZero has insurance through Bahamas First General and Lloyds of London. In fact, they have an A, excellent rating (find out how to invest in stocks for beginners with little money). That's a good peace of mind to have if you plan on opening an account.
In a nutshell, this TradeZero review shows that this broker is best for non-US traders who don't have $25,000 cash in their account. If you can handle 200 share limit order trades it's perfect. It's a great starter platform and appears to be pretty popular with our members who are outside the USA.
Short-sellers especially will love the short locates Trade Zero offers. US traders don't despair, check out the discount brokerage ETRADE or Interactive Brokers for more advanced trading tools. We have a full list of reviews and data on all the brokers out there with our first hand experience.
If you need help with your trading, why don't you try us out for a month free. In fact, if you’re not happy with our stock trading service simply cancel your membership.
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