ScoTTrade.com Was Temporarily Unavailable I'm Making It Permanent
Written: Oct 07 '03
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For the past year I have been a member at ScoTTrade.com. For the most part, my experience has been fairly positive. Unfortunately, over three years of on-line investing has taught me that fairly positive just isn't good enough. In addition to my year experience with this site, I have also been associated with Ameritrade(Datek) for approximately three years. In nearly every aspect, I find Ameritrade to be my recommended choice.
Why Choose Scottrade?
ScoTTrade.com does offer it's clients a vehicle for trading listed stocks and Nasdaq companies as well as bulletin board stocks. Over 9000 mutual funds are listed and may be traded via this site without incurring any transaction fees. For the more savvy and seasoned traders or those that may consider the risk of entering the options market, options trades may be completed on this site with discounted brokerage fees. A wide range of fixed income securities including secondary corporates, U.S. Treasury, and municipal bonds as well as certificates of deposit are also available to those investors that want to limit risk in their portfolios.
Investors can find a number of reasons for selecting this site to carry out their trades. As a matter of fact, for investors that only occasionally buy equities or mutual funds and tend to use a "buy and hold" strategy, many of the problems I have encountered may go undetected. If this is the case, you may find that ScoTTrade.com may suit your needs.
First, trading is relatively inexpensive. $7.00 is all it costs for market orders with no limit on shares. Unfortunately, few of my trades are market orders but rather limit orders. Limit orders are charged at a rate of $12.00, but again, there is no share limit or hidden charges. Investors can open an account with as little as $500.00.
Secondly, I like the fact that there are 189 local offices and one only a half hour drive from my home. I actually used the local office to set up and fund my account. The office in Southfield, Michigan had personnel which were friendly, helpful and knowledgeable on each of the three trips I made there.
Another advantage stemmed from the fact that this site has no inactivity fees associated with it. Although this is not a concern now, I did get caught paying several inactivity fees with Ameritrade when I was first starting out. Most on-line brokers will waive account maintenance fees if your account meets minimum balance and/or trading requirements making this a non-issue for many clients. ScoTTrade.com also makes No-Fee IRAs available the their customers.
Free unlimited real-time quotes and streaming quotes are available during regular trading hours. In addition, interactive charting is also available and easy to use. Free real-time news and research tools are also available through the likes of S&P, Dow Jones News and Thomson Financial Research.
Similar to Ameritrade, trades may be made in a variety of ways. Although I have only used on-line trading, broker assisted trading with a personal broker and wireless trading are also possible.
ScoTTrade.com does supply it's clients with clear and complete electronic confirmations as well as electronic monthly statements. I found these statements to be helpful during the tax filing season.
Three Strikes - "You're Out"
I recently closed out my cash position and am moving my remaining equities to Ameritrade after three very disappointing experiences.
•Strike One! My first disappointment came early this spring when attempting to sell my position in CovansysCVNS. This stock experiences only limited trading during most trading sessions so choosing a selling opportunity is critical. Early morning trading on related news sent the stock considerably higher offering an unbelievable selling opportunity. I proceeded to confirm my sale to be greeted with a page I would begin to see all too often:
Temporarily Unavailable
Your request could not be processed at this time. If the problem persists, please call your local branch.
I was not in the position to take the time to make a broker assisted trade and precious time was ticking away. I finally was able to complete my sale over an hour later at a substantially lower price. Since that particular occasion, I have experienced site outages on several other occasions both during and after regular trading hours.
•Strike Two! Again, pre-market news opened up another buying opportunity. With an appropriate cash position already available in this account, I attempted numerous time to complete my buy transaction. Each time I received an error message, leaving my transaction incomplete. During my subsequent call to the local ScoTTrade.com office I was informed that extended hour trading is no longer offered through the site. My purchase of Peregrine SystemsPRGN following the opening bell was completed but unfortunately at a 4% premium.
•Strike Three!More recently, I decided to make a purchase of Atlantic Coast AirACAI following the announcement of their proposed split with United Airlines and plans to start their own low cost airline. To raise sufficient cash I prematurely sold my position in LucentLU at a loss. Once the sale had completed I immediately placed my purchase order for Atlantic Coast Air. I was informed that purchase of the selected stock could not be completed on-line and to contact a broker.
Sorry, No Recommendation Here
For investors interested in a site to accumulate equities, mutual funds and fixed income securities for the purpose of long term investing, this site may be suitable. Those investors will be happy with the discounted brokerage fees and access to plenty of information. Perspective investors should be aware all this can be found on other on-line sites without the pitfalls I've described. Between my Ameritrade experience and the three instances above which easily cost me several thousand dollars, I can't recommend ScoTTrade.com.
Recommended:
No
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