Zacks Trade Review: Great for Broker-Assisted Trades

Zacks Trade is an online brokerage firm that’s been popular, particularly with active traders. However, now that most online brokers have eliminated trade commissions, Zacks Trade’s penny-per-share pricing looks less attractive.

In this Zacks Trade review, we’ll look at the brokerage and its services to see whether it could still be a good fit for your portfolio.

Zacks Trade Features

Open a Brokerage Account with Zacks Trade

Additional Features

• No Extra Fees on Broker-Assisted Trades. A real rarity among online brokers, Zacks Trade offers broker-assisted trades for no additional fees.
• Foreign Stock Exchange Trading. With a Zacks Trade account, investors can trade on nearly 100 international exchanges.
• Open to International Investors. Investors in almost 200 countries (excluding Canada and Japan) can use Zacks Trade.
• Day Trading. You can use Zacks Trade’s platforms for day trading as long as you have a balance greater than $25,000.
• Portfolio Rebalancing. Zacks Trade offers a tool that will rebalance your entire trading portfolio based on your goals and risk tolerance.
• Market Screeners. Screen stocks, options, and funds based on parameters that you specify.
• Free Paper Trading. You can “practice” on the Zacks Trade Pro platform without committing a penny.

What Is Zacks Trade?

Zacks Trade is a platform designed specifically for active traders. Len Zacks founded the online brokerage, beginning to publish work on innovative investment strategies in 1978. Zacks also founded North America’s second-largest independent equity research firm, Zack’s Investment Research (ZIR).

After a few decades of providing top-notch research, ZIR established LBMZ Securities, the broker-dealer that runs Zacks Trade. Zacks Trade’s mission is to supply active, independent traders with cutting-edge tools and sophisticated research.

Altogether, the Zacks Companies manage more than $5 billion, and more than 200 million shares have been traded on Zacks Trade.

How to Get Started with Zacks Trade

Unlike some other brokers geared more toward beginners, Zacks Trade requires some trading experience. When you apply for an account, you’ll need to submit a trade history of at least 100 live trades. You can also substitute 100 trades made with a simulated trading account (Zacks Trade provides a virtual trading platform that lets you do this).

You also need to meet the annual net income and liquid net worth requirements. If you want to trade more advanced securities, you may need to meet additional requirements.

You can open two kinds of accounts at this broker: cash accounts and margin accounts.

• With a cash account, you can trade only the funds you deposit.
• If you are approved for a margin account, you can borrow money from Zacks Trade (and owe interest) to purchase trades.

You can mail, fax, or email application documents to the Zacks Trade customer support team.

You also need a minimum balance of $2,500 to trade on Zacks Trade.

Typically, it takes 24 to 48 business hours to learn whether you’ve been approved for a Zacks Trade account.

Funding Your Zacks Trade Account. You can transfer money into your Zacks Trade account by completing a wire or ACH transfer or by mailing in a check.

Open a Brokerage Account with Zacks Trade

How Does Zacks Trade Work?

Zacks Trade offers three trading platforms that anyone with an account can use.

Zacks Trade Pro is the flagship interface. You can download it onto your desktop. This platform has a whole bunch of cool tools to use:

• Algorithms: Use algorithms such as Arrival Price, Percentage of Volume Strategy, TWAP, and VWAP
• Basket Trader: Import and execute baskets of stock orders
• Market Scanners: Screen stocks, options, mutual funds, bonds, and more based on your specified parameters
• Options Strategy Lab: Generate strategies based on your price forecast for underlying stock
• Probability Lab: Calculates options probability
• SpreadTrader: Manage complex option spread orders
• Volatility Lab: A complete toolkit to help you manage volatility

As you can guess, Zacks Trade Pro is geared toward advanced traders, not beginners.

More novice traders may prefer the Zacks Trader platform, which is a scaled-down trading experience. The browser-oriented Zacks Trader is fundamental in nature while still providing high-end customization options and tools.

There’s also a mobile app called Handy Trader, which lets you do pretty much everything the Zacks Trader platform does but from a mobile phone.

Now, all three Zacks Trade platforms are practically identical to what Interactive Brokers offers. That’s because Interactive Brokers created the platforms, and Zacks Trade rebranded them.

Interactive Brokers recently changed its pricing structure and now offers two accounts, IBKR Lite and IBKR Pro. If you’re investing in just stocks, you can pay zero commissions with an IBKR Lite account. More complex trades with IBKR Pro will involve commissions, but they’re lower than what Zacks Trade charges.

Investment Options

Zacks Trade offers a variety of investment options for traders, including:

• stocks
• penny stocks
• ETFs
• mutual funds
• bonds
• options

Pricing

No account, maintenance, order cancellation, account inactivity, or IRA custodial fees. Service offerings are also offered a la carte style at a monthly rate.

The more you trade, the more you save. For more details on U.S. trading fees or to view international trading fees, visit Zacks Trade’s pricing guide online.

• Stocks & ETFs greater than $1 per share: $0.01 per share ($1 minimum)
• Stocks & ETFs less than $1 per share: 1% of trade value ($1 minimum)
• Options: $1 for first contract + $0.75 per additional contract
• Mutual funds: $27.50

Is Zacks Trade Secure?

Zacks Trade is a secure, reliable interface that takes client information protection seriously.

Along with standard encryption technology, 128-bit SSL encryption, to be exact, users can breathe a sigh of relief with maximum insurance protection coverage of $500,000 (cash sub-limit set at $250,000) against broker failure.

A secure login system is required for all users, no matter which workstation interface they use.

Multiple security devices aren’t required because a single device can be shared across multiple accounts per user. There’s no minimum asset limit, so user accounts are fully protected regardless of capacity.

For those who want to go the extra mile in account protection, you can securely restrict account access to predetermined IP addresses.

The intuitive software automatically restricts account access after a set number of failed login attempts, and automatically logs off if it detects a certain period of account inactivity.

Zacks Trade Pros & Cons

Before investing time, money, and effort in Zacks Trade, let’s examine the pros and cons of this online resource. An informed decision is always the best decision.

At a glance, Zacks Trade offers one-of-a-kind trading fees, global market data streaming, and à la carte service offerings, among other features that may attract more seasoned traders.

Since the interface isn’t as user-friendly as similar investing platforms and requires a $2,500 minimum balance for all users, interested novice traders may face a steep learning curve (and a dent in their bank account).

Let’s now walk through the main pros and cons of Zacks Trade’s signature offerings.

Zacks Trade Review – Conclusion

Zacks Trade is geared toward more advanced investors, investors living overseas, or investors who want access to stock exchanges outside of the U.S.

If you are a more casual investor or don’t need access to overseas exchanges, you may want to choose a different brokerage, especially now that most online brokers have eliminated commissions. For example, you can use Charles Schwab’s Thinkorswim platform (originally built by TD Ameritrade, fully absorbed by Schwab) to trade stocks, options, and ETFs without paying commissions. Beginner investors may be better served by an easy-to-use broker like Ally Invest.

Who is Zacks Trade best for? If you are an advanced investor or you want to trade on margin, Zacks Trade is still a good call. The broker offers some of the lowest margin rates, so you could save money on interest.

Zacks Trade is also an excellent option for investors who live outside the United States or want to trade on exchanges outside the U.S.

Finally, Zacks Trade is also good for investors who want over-the-phone broker assistance. You can reach a licensed broker during business hours, and they can place trades for you without charging extra fees. By comparison, Charles Schwab charges a broker-assisted trade fee for phone orders, so it’s worth checking their current fee schedule, since it’s changed since TD Ameritrade’s absorption. Ally Invest is a bit more affordable, at $20. However, if you use this feature regularly, Zacks Trade should be at the top of your short list.

Open a Brokerage Account with Zacks Trade

Meet the Author

Ryan Guina

Ryan Guina is The Military Wallet's founder. He is a writer, small business owner, and entrepreneur. He served over six years on active duty in the USAF and is a current member of the Tennessee Air...

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