Bottom line: Firstrade could be a good brokerage choice for US residents and international investors looking to actively trade multiple investment types for free. It may not be a good fit for you if you're looking for professionally managed accounts or automated advice.
Headquartered in Flushing, New York, Firstrade was founded in 1985 as First Flushing Securities. In 1997, the company launched Firstrade.com to provide online brokerage and trading services. Firstrade is a discount online brokerage offering investing, retirement, custodial, and cash management accounts for active traders. But it doesn't stop there. The brokerage also lets you trade almost all of its investment products for free, and this applies to both US-based and international investors. Firstrade is available both on iOS and Android devices. Keep reading to see how Firstrade works.
Firstrade, TD Ameritrade, and SoFi all offer $0 account minimums and commission-free trading for active traders, but each brokerage varies when it comes to account types. For instance, Firstrade doesn't offer any automated or advisor-managed accounts, but TD Ameritrade and SoFi do. In addition, though TD Ameritrade and SoFi both offer options for hands-off investors, you'll pay less for managed accounts at SoFi. TD Ameritrade also no longer offers its Essential Portfolios automated account to new clients, but it offers two advisor-managed accounts (Selective Portfolios and Personalized Portfolios). If you're still interested in Firstrade's offerings, though, keep reading to learn more.
Ways to invest with Firstrade
Self-directed brokerage accounts
Firstrade offers individual and joint investing accounts for US-based and international investors. Each account includes commission-free trading on stocks, ETFs, options, and mutual funds. And, unlike many online brokerages, Firstrade doesn't charge any options contract fees (most brokerages charge $0.65). Firstrade offers more than 2,200 commission-free ETFs and 3,400 commission-free mutual funds, and you'll only run into fees for some of the brokerage's fixed income investments (for example, primary market CDs cost $30). Unlike most investment platforms, Firstrade charges $0 for all mutual funds. The brokerage's other investment choices include treasury bills, notes, bonds, CDs, and other fixed income investments.
You'll also have the choice of multiple fee-free retirement accounts. For individuals, Firstrade offers traditional IRAs, Roth IRAs, and rollover IRAs. Businesses can set up SEP IRAs or SIMPLE IRAs. You can set up any of Firstrade's IRAs without having to worry about minimum opening deposits or account fees. In addition, Firstrade says it uses IRA specialists to help new clients with rollovers.
Education savings accounts (ESAs)
Firstrade's Coverdell Education Savings Account (ESA) lets you set aside money for children or designated beneficiaries under the age of 18. You can open multiple ESA accounts, and any withdrawals you make for your ESA are tax-free (you can currently make up to $2000 in non-deductible contributions per child). You can also set up a custodial investment account for your child as long as they haven't reached your state's age of majority (usually 18 or 21). Firstrade's custodial accounts don't have any contribution limits, custodian income limits, or minimum deposit requirements.
Research and trading tools
Firstrade also gives you access to free research from Morningstar, Zacks, Benzinga, and Briefing.com. As for its trading tools, Firstrade's four platforms — the web platform, mobile app, Options Wizard, and Firstrade Navigator — all offer access to account information, investment performance, and market data. However, Options Wizard specifically offers tools and insights to simplify options trading. Firstrade Navigator lets you manage all of your trades, orders, and account balances on one screen.
Firstrade offers international trading in more than 65 regions, including China, Hong Kong, Singapore, India, Israel, Japan, Korea, Mexico, Malaysia, United Arab Emirates, and more. And the brokerage even provides toll-free customer support and online trading for Chinese-speaking customers. If you're not a US citizen or permanent resident, and you don't have a Social Security or tax ID number, you can sign up for an international account. Firstrade offers international trading in more than 65 regions, including China, Hong Kong, Singapore, India, Israel, Japan, Korea, Mexico, Malaysia, United Arab Emirates, and more. And the brokerage even provides toll-free customer support and online trading for Chinese-speaking customers. If you're not a US citizen or permanent resident, and you don't have a Social Security or tax ID number, you can sign up for an international account.
Is Firstrade trustworthy?
Firstrade has received an A rating from the Better Business Bureau. The BBB rates companies using a grade scale range of A+ to F, so an A rating suggests that Firstrade exhibits exceptional business practices and customer interaction. According to BBB's website, its ratings represent its opinion of how well a company interacts with its customers. The bureau also examines both customer complaints and whether a company responds and closes each complaint. Not every investment app has the same rating — for instance, Robinhood currently holds an F rating due to a large number of customer complaints and the BBB's concerns with its business practices. Firstrade hasn't racked up any major lawsuits or scandals since its founding in 1985. BBB data shows that the company has had two complaints filed against them in the past three years, and one complaint that was closed in the last 12 months.