Online Brokerage Comparison: I Gave Up on Scottrade!

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This is a guest post authored by frugal at My1stMillionAt33.

Before I tell you about my terrible experience with Scottrade, let me first compare several online brokerage firms in terms of commission costs:

  1. TradeKing: Best for active traders. $4.95 per trade, even broker assisted trades, very cheap rate for option contract at $4.95 + $0.65 per contract. They’ve also won numerous awards from the likes of Barron’s, SmartMoney, etc. They were named Smart Money’s Best Discount Broker many years in a row.
  2. Scottrade: Best for casual traders and/or investors. $7 per trade. $0 for loaded mutual fund, but $17 for most other non-loaded mutual funds. Option contract at $7 + $1.25 per contract. Has offering on CD & fixed income bonds. Can only do the following option trades: buying put/call, or sell covered call.
  3. ETrade: More expensive compared to both Ameritrade Izone and Scottrade, unless trading more than 1500 trades per quarter.
  4. Sharebuilder: Good for long term investor. $4 for automatic investment, and can be as low as $1. Selling is $12 to $20 depending on the plan. The biggest downside is that you give up the control on the market timing for your buy order. Instead you will do time-averaging through automatic investment.
  5. BuyAndHold: Best for asset allocator and long term investor. I will recommend this to anyone who is currently using Sharebuilders. I like their $14.99 per month for unlimited number of “window” trades which get routed 3 times a day. With $120 $180 a year, you can buy and build 1000 stock portfolio if you want (just kidding, but it’s true). I don’t think you can beat this deal, especially after (under Ameritrade) is gone.
  6. FirsTrade: Even better than Scottrade. I’m sure everyone has lamented the reduction in the NTF program for mutual funds at Scottrade. Well, if you use FirsTrade, you can get it back. Yes, ALL mutual fund trades are FREE. And the stock trades are 5 cents cheaper at $6.95. Their pricing model is essentially the same as the old Scottrade. But they don’t have any physical branches.

Enough of cheap commissions, but if it is not reliable, it is pretty much useless. So back to my Scottrade bad experiences. My problems with them is that their internet servers are getting so unreliable, especially the first half hour right after the market opens, that it is no longer usable.

  1. One time I tried to day trade a stock, and I almost got sacked by Scottrade. I placed limit order, and I was barely able to cancel and modify my entry price in time because their servers kept non-responding.
  2. The second time, it was pretty much unforgiveable. I put in a limit order, and when I attempted to cancel the order, I simply cannot cancel it, even though it is still showing on my screen as open order. Somehow somewhere there is a server problem. Minutes later, my limit order became executable. I called up customer services, and they could not determine whether my order was filled or not. After an hour, my order got executed with a timestamp of an hour later. Scottrade claims that the timestamp is the reporting time, not the executed time, and my order was filled minutes later, instead of an hour later. Scottrade refused to correct anything, but simply blaimed everything on the delays of the market makers.
  3. Yesterday, again, stupid me, I was doing trades near market open. I am so certain that I cancelled my order. But I had some problem with their server again in the morning. After a couple of hours, I finally found out that my “un-cancelled” order got executed. They claimed that I never cancelled the order. They really have a big problem with this process. At the end of cancellation screen, there is never a confirmation number given out. I can never write down any # to prove that I have attempted to cancel my order. So after a long talk of repeating the same information over and over, and an eventual non-callback, it appears again that they will not do anything to my phantom trade becoming real and losing significant money in such a big down day.

I know that FirsTrade has its problems, especially with market quotes right after market starts. But at least there is never a problem with non-responding servers that give you a page-not-found error. Probably because they are smaller company. In any case, I am moving majority if not all of my money out of Scottrade. I’m so fed up with their parrot-talking customer non-service. I was planning to move my tradings to Ameritrade Izone, but after reading some comments at Dogs of the Dow, I’m a little hesitating now. If you have recent positive experience with Ameritrade or any online brokerages besides Scottrade, would you please suggest them to me? I don’t really know where I could find a reasonable priced and reliable brokerage now. I plan to use FirsTrade for now. Since I never tried their streamer, maybe FirsTrade streamer will not have quoting problem. I can always use the other online brokerage accounts for quote too, so it won’t be such a problem.

Thanks in advance for your online brokerage suggestions to me. Cheap commission is not everything. Without reliability, all (stock) bets are off. I’m planning to take my complaints to NASD. By the way, I really miss the reliability offered by Datek, which was bought by Ameritrade. That was my first reason of moving to Ameritrade since I assume that the platform would be similarly reliable. And I hope you will find both FirsTrade and BuyAndHold useful.

{ 78 comments, please add your thoughts now! }

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78 Responses to “Online Brokerage Comparison: I Gave Up on Scottrade!”

  1. A3GR says:

    There should be a class action lawsuit initiated against Scottrade for not allowing their customers to cancel a sell order online for a stock that has halted trading for a few hours. I had complained verbally with no sympathy and then through FINRA and Scottrade refused mediation. They apparantly are not very interested in good customer service or improving their online problems.

    • Ron says:

      A3GR, I totally understand what you went through. The same thing happened to me. At 9:28.40 sec, I canceled my order to buy a stock and was filled at the opened. I was told by the compliance dept. that this was an industry rule and that cancelling after 9:28am est, is due a fill. I have filed a complaint with FINRA and waiting for their findings.

      You would think that this disclosure on canceling after 9:28am est would be on their website some where, but it isn’t.

      I used to be a licensed broker for 7 years and have never heard of this before. I am looking for a lawyer to look into this. If you are still upset, please respnd back to this email so we can chat.

      What I am concerned about is that if this is happeneing to me, it must be happeneing to others. I actually have one other person who had the same issue with them. Im thinking this happeneing to many others.

      This is not right.

  2. Amber says:

    A3GR – I am the Online Public Relations Specialist for Scottrade. I am sorry to hear that you are unhappy with Scottrade. I would like to look into this matter further. Please e-mail me at mediarelations (at) scottrade (dot) com. Thank you, Amber Talbot – Scottrade Public Relations

  3. Mike says:

    I’ve been an E-Trade customer for many years now and have just decided to start looking at other brokerage firms. This was mainly because a friend told me about Zecco. After looking at several discount brokerage firms I settled on Scottrade, the reason being they offered almost everything E-Trade did but at a lower cost. Some of the other firms (such as Zecco) weren’t as complete or as polished.

    Also, right now, Scottrade is offering 3 free trades…if anyone is interested in saving $21 tell them you were recommended by a friend and put in KEYB8905

  4. Upset Trader says:

    Subject: Scottrade pre-market order cancellation problem.

    If anyone is interested in joining me in a class action lawsuit against Scottrade, please respond to this
    Only respond if your issue is similar, which is canceling your order before the stock market opens.

    This is the letter forwarded to FINRA and I am awaiting a response back.

    I spoke with Jim at FINRA today to explain my concern with Scottrade. Jim informed me to forward this complaint letter.

    On ****/2008 between 9:26 am EST – 9:28 am EST, I placed several orders to buy a stock. I noticed that the Bid/Ask price was fluctuating so I decided to cancel the order so I can place a new order when the market opened, hoping to get a better price. I had canceled my last order at 9:28.40 seconds. When the market opened, Scottrade filled my canceled order.

    Being very confused about the trade, I contacted Scottrade to see what had happened. I then spoke with the Compliance dept. which said “Canceleing a trade after 9:28am est. is due a fill according to the market maker-NITE TRADING. Since my canceled order was done at 9:28.40 sec I was due a fill. I had asked for the official rule for canceling a trade after 9:28am, or if they could show me on the Scottrade website where it states this rule. Complaince explained that he does not have to show me anything and that I need to file a complaint letter and they will follow up with it. I had ask to speak with the compliance manager and was told that I have been informed and I can not speak to him.”

    I am very concerned about this trade as hundreds of investors are having this happen to them. If this were a 1000-5000 share trade, this could have been a much bigger problem”.

    I’m sure that Scottrade has recorded the phone call, but if they don’t have the recording, I recorded the phone call for my records.

    I believe this is an issue that needs to be looked at.

    I am certain that if Scottrade would have informed me on this rule of canceling a trade after 9:28am est, I would have not made the trade. I really don’t think anyone knows of cancelation order after 9:28am EST.

    I used to be a licensed trader for over 7 years and have never heard of this before. It sounds like a software issue, Market Maker error, or Scottrade made the error and has told me a bunch of balogna/baloney.

    Based on the comments on this board regarding Scottrade, I believe something has to be done.

    “My voice my not be heard, but hundeds of voices will.”

    Thanks for your help,

  5. MC says:

    Here’s an up to date, active referral code for 3 free trades. The offers for 7 free trades is over. 3 for free is the best current offer. Use code: GLWQ3768 when opening an account to receive your free trades! When asked how you heard about Scottrade, click referred by a friend and enter this code! Beware of inactive codes on the net, many do not work. Rest assured this one is active!

  6. MC says:

    This code works on Scottrade, I just tried it. Get 3 free trades. Beware of those claiming that you get 7 free trades. My friend recently tried those and it does not work – called Scottrade and they said the best deal is 3 free trades!

  7. Scottrade Failed Me says:

    I echo Upset Trader’s comments.

    I was unable to cancel an order before market open today, again due to an unresponsive server and the trade was executed. What really gets me is that, after not being able to cancel, I tried to modified the trade to a limit order. This was confirmed, but the trade was executed as originally placed, without the modification.

    I have found Scottrade’s local branch manager, regional branch manager, and two compliance officers to be completely unhelpful in attempting to resolve this issue. On top of not providing a resolution, they simply did not return phone calls as promised. It has been a poor customer service experience.

    This one time has made me realize the value in realiability that other posters have referred to. Never again will I allow this to happen, no more Scottrade.

    Buyer beware!

    I will be following up with a complaint to FINRA.

  8. A3GR says:

    FINRA was of no help for me. A class action lawsuit needs to be initiated against Scottrade for the issue of not being able to cancel a trade. This is clearly a fault in their system and costing their customers a lot of money.

  9. Eddie says:

    Regarding Scottrade, I really don’t know what to do. I would like to open a dialogue with some of you that have complained. May 12, 2009 the major problems began. I couldn’t even get onto the site. It kept freezing up, in fact only half a page appeared..ironically the part that says, “Reliable, Stable and Trusted.” The streaming quotes were not streaming but acting crazy….the site was freezing up and extremely slow. In the streaming quotes, I kept getting “closed, connecting or establishing.” It was a disaster. I immediately called their office, (here in San Diego)..and complained to the manager..(no need to mention his name)…he even could not get the site up on his own computer… after waiting on the phone… he said he knew of no problems with their system and that I should check my cookies..and sent me on a wild goose chase into my Mozilla Firefox. The lady sitting right next to him was aware that they were having major problems with their site, but for some reason he did not know about it. By now, an hour had passed. I called the 800 number to ask them what was happening, and was on hold, for what seemed to me to be an eternity. When I finally got through, they said that they would “look” into the problem, but that was not helping me. During that period of time, I lost over $10,000..I had no idea what the stocks were doing. I am a day trader and get in and out of positions as the market trends. Sometimes after only several minutes. I could not do that. And Scottrade was VERY UNHELPFUL, almost as if, “Why are you bothering us???” When I finally got through to tech, “Jessica G”…..she assured me that the problem would me corrected, and if not, to call her immediately. That night I had purchased two very large positions and in the morning both positions had gone up. As I usually do, I immediately went to sell both positions, take a nice profit, but once again, I couldn’t get into the Scottrade site for the life of me. The site froze up. I frantically called the manager once again, and was on hold. As usual, people were taking their profits and the stocks were rapidly declining. I was watching the stocks free fall and my dollars disintegrate before my eyes……I lost another $12,000 in mere moments and finally…. the manager acknowledged their site was having problems, now for the second day in a row. Again I sensed that he was “put out” that I was calling him…and in any event there was nothing he could or would do. In those two days, I lost $22,000 and I sincerely believe that 99% maybe even 100%…was the fault of Scottrade. I went to call Jessica G, and she didn’t answer, and the number she gave me (to call her immediately) was a number into oblivion. I did finally get through to a “tech” he said he would “note” the problem. I sent them several e-mails and complained to everyone that I could, but to no avail. On May 18, 2009, I received a letter from Scottrade, with a cc: to Rodger Riney, where they apologized for the problems and said that they would credit my account for 5 free trades. Generally, over the last year, Scottrade has been pretty good, and I haven’t had too many problems with their site, but this situation has literally made me sick…..I feel so vulnerable to them. What am I suppose to do??? Hire some arrogant attorney who will take even more of my money….as I said, I would like to open a dialogue with some of you…a class action sounds nice if it’s feasible…. I have liked Scottrade for the most part…they have been reliable…..that’s why I was so shocked to have these problems. My e-mail is

  10. […] years, I’ve heard good things about Scottrade (mostly from people defending Scottrade in this guest post) but never tried them. I mostly use E*Trade because of their high yield savings account and […]

  11. Joseph says:

    I had Etrade years ago, but they had a lot of fees. Sharebuilder is good, but the $4 only applies to auto investments. Otherwise, it’s $10. I tried TradeKing, but their interface was a bit of a nightmare.
    I ended up with Ameritrade.

    Also worth mentioning, as of recently, Ameritrade acquired some great companies/tools:

    Think or Swim

  12. Mike247 says:

    You guys should probably do some GOOGLE searches before you start bashing a company and filing complaints. Please see the following link:

    Some other comments. 3 business day settlement is an industry rule. Supposee your entire account consists of $1000 ABC and that’s it. You can sell the ABC on Monday and it will settle on Thursday. Before Thursday if you want to buy with those unsettled funds, that’s fine, just don’t sell the new purchase before Thursday otherwise it’s an industry violation.

    Also, if you ever try to cancel an order and there is a hiccup, it could be due to a variety of issues. Do a quick ‘print screen’ and contact Scottrade. They, like any financial firm, have records and will fix the issue. Do you really think a company that has been in business for 30 years is violating rules? It’s amazing that everyone will say a brokerage firm “caused them $$$$ in losses”, AFTER you are able to see what the stock does. In your same example suppose you had a buy and “couldn’t cancel it”…then the market opened and the stock went up 5%…doubt you would be calling Scottrade to complain then.

    It’s too bad that with the internet, so many people feel the need to complain about nonsense. Read the rules before you complain

  13. Still Angry says:

    I received an email saying my Scottrade “debit balances” are being waived.

    That’s something, I guess.

    Be nice, I’d have thought, to also see some thanks for all the business I used to give them, and the recommendations.

    Seems they are the ones with the debt balance — to ME.

  14. Rick says:

    I read through some of these comments…here is what I do, it works well:

    I only use scottrade for the actual execution, and almost always use limit orders, to ensure I get the price I want. I follow the share price on google finance, which is a VERY good tool. That being said, I dont daytrade.

    If you daytrade, I have heard interactive broker is the way to go…but it has a steep learning curve.

  15. Scottrade Sucker says:

    Scottrade would not let me cancel trades or execute trades on May 6th flash crash. Even though my order sat in their server for over 6 seconds they just went ahead and put my canceled order through anyway. Their own market maker is scoping out your trades and taking them while you are given less than accurate information. How rotten is it for stealing for your own customers and refusing to send profitable hours out to the real marketplace. I say STAY AWAY if you are a day trader. If you buy and sell once a month they they are great for you.

    • Jessica says:


      We would like to look further into your situation.

      Please call us at (800) 619-7283 and ask to speak with the Compliance Department.

      Social Media Specialist, Scottrade

    • Fairtrade says:

      SS (Scottrade Sucker)
      I am not a day trader. In my opinion they are lousy for investors as well. as you will note from my previous posts their customer sales (no service) AE’s are likened to 300 pound gorilla telemarketers paid 100% commission that would make seasoned used car salesmen drool (no offense to used car salesmen). Their phone tactics are “get the money and get disconnected”.
      For a FINRA registered firm, one would expect more professionalism and adherence to regulations. To my surprise, they offered a monetary settlement for my rule violation claims instead of fining/suspending the AE and supervisor who attempted to steal my money. My answer (some may disagree) was FINRA rules are a higher standard than sole monetary compensation. Sure the AE’s and their trainers bring in big bucks just like Lehman Brothers & Bear Stearns but it is against the law-and I firmly believe that FINRA rules are made for investors not salesmen.

  16. James says:

    I work for Scottrade and apologize for your bad experience. We would like to have you back as a customer so if you open another account and just enter “” as a referral we will give you 10 free trades good for a year.

  17. David says:

    I love scottrade they don’t charge monthly fees and their commissions are fair. You can even use a code YQUN2526 and get 3 free trades when you sign up for a new account. I saved $21 when i signed up for my account.

  18. Dr Danny says:

    I changed from Ameritrade to Scottrade with 3 accounts. I have cancelled limit orders and the screen shows me if it is open or not. I have had the opposite experience of really like Scottrade. I am a small town doctor and not paid by Scottrade but I really like the agents that work at the Charleston WV office. They treat me like a good friend and always very respectful.

  19. Charles says:

    I discovered, too late, that the trades listed at a dollar/share mean I have to pay more money. On the front page of the site, it says:

    “Stock trading is affordable with $7 online trades. You can trade unlimited shares, and open an account with just $500. Understanding our stock trading fees is simple – we charge no inactivity fees, no transfer fees, and no account maintenance fees.”

    So when I try to make a transaction, I find there are extra fees. I what is wrong with this picture? I have more than $500, just to be clear.

    • joe a says:

      yea dey have dey have an fcc regulation fee of .000195 % per 100 dollars of the principle of stock buys dey dnt tell u about this fee dey jst pasit on as dey put it to der clients it sums up to jst pennys 5cnts 3cnts X 150000 trades dey du a day sums up to millions for demout of our pockets

  20. john heath says:

    I am interested in filing a lawsuit against scottrade. My problems are many. Do I frst go to the SEC ??



    • sergio c says:

      yea I get an order number but wen order gets executed iget difrnt quote price evn after I lokd in quote price

  21. kris says:

    I use scottrade never had a problem

  22. Quercua says:

    I have had these kinds of problems and others as well, lost huge amounts of money (for me) and had a margin call I couldn’t satisfy on top of everything else because I simply couldn’t get the direct deposit function to work (like much else) nor could I delete it and then add it back, because it was somehow storing the old information…maybe.

    My money is still just sitting in their account, for THEM to make money with, because I have simply been too demoralized to try again to get it out. At some point, obviously, I’m going to have to make another attempt at dealing with their tech support people–who have just never heard of such problems…”Why whatever are you talking about?” Yeah, RIGHT. I can almost see them batting their eyes.

    After spending a couple of frantic afternoons on the website and on the phone with my bank–didn’t EVEN bother to try to talk to anyone at Scottrade at that point, as I had tried fruitlessly the day before–I had to simply succumb to my fate.

    As mentioned above, it was such a long process, with such incomplete information that I soon became totally bewildered even with the screen shots I had managed. (And try doing THAT while you frantically try to stop your money from rushing down the toilet.)

    Additionally, it seemed to me that it HAS to be deliberate that there is no way to actually see the times, charges and all the other relevant data on sales in one place in any useful way. I had an absolutely terrible time.

    What I want to find out is, is there any point in suing them?

  23. Nancy says:

    I became a SCOTTRADE customer in 2003. I was happy with customer service rarely had problems placing trades.
    Until I discovered recently that beginning around 2007. I began receiving phony income tax statements. I called the Sayville NY branch and spoke to Chris Beatrice about this problem. He was made aware prior to this occuring. That my former husband had been accessing my HSBC Securities accounts without my permission. I was asssured that would not happen at SCOTTRADE. Until it happened. At which time. Chris told me he would not discuss it with me.
    Last week following my email requesting my 2011 tax statements (two accounts). SCOTTRADES answer was an email telling me that my account was closed. I could no longer buy stock only liqidate positions. Could only do so with Chris Beatrice in Sayville branch. Lost online access.
    On Monday Feb.27th.12. I called the 800 SAVE number. Asked to have the settled funds FEDEXED to me right away. The money was not sent remains in my account unable for me to access to.
    Lot’s of trained professionals give themselves exceptions to the rules of securities law. My belief is that the rules apply to everyone every time. Or they are not rules at all.

  24. Grant says:

    Scottrade needs to train its employees in the art of knowledge and manners. I spoke to Chris Beatrice about a stock options form that he assured me did not exist when in fact it does (after calling HQ) a month later he decides to close mine and my wifes account saying some BS excuse only to finally hear him say the reason is that “a month ago when I confronted him with a form that I knew existed that he did not within the scottrade company” he said that our conversation did not sit well with him, He further also said that me and my wife are banned from even opening a personal account. I guess when some jerk is made branch manager he has to prove to himself (and the parents he still lives with) that hes a somebody. He wont last in this business, he does not have the heart, talent, drive or guts to watch others make money when he just sits there and pushes keyboard buttons all day. My wife also said he needs to take a shower more often….

  25. UseTradeKingThen says:

    If you say TradeKing is the best why not just use them then. I changed my mind because of this post. Definitely not opening an account with scotrade now. But am thinking about tradeking instead.

    I’ve been uding M&T Securities only because my investments were handed down to me from an inheritance and that’s who my father used for 10 plus years. But he held his stocks longterm, so the full brokerage commission is killing me now. If it wasn’t for the crazy amount of commissions I would stay with them forever. Eventhough the customer service at the 800 number in buffalo sucks. Most of the females are cranky with attitude problems and don’t know crap. The men have less attitude but everybody has to put you on hold first to find out the answer to any question I have. Never really had any major problems just simple stuff when first starting out.

    If commissions not a big deal to you and you want a reliable quick online trading platform, with no problems at all with orders processing, I’d say find a M&T bank near you and open a broker account with them. Or probably any small full brokerage service. You get what you pay for with the discount brokers. But it’s only worth it if you plan on holding a small amount of stocks long (under $20,000), since commission runs anywhere from $30 to way over thousands of dollars depending on the amount of the trade. Effing crazy.

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