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Just2trade Review

On-Line Broker Just2trade Review:

Just2trade is an on-line brokerage firm that caters its services to experienced investors. Typically investors targeted by Just2trade would have at least two years of prior trading experience, understanding of trading terminology and personal finance management. Its parent Success Trade Securities was founded in 1999. The company offers the following accounts:

  • Individual accounts for both U.S. domestic and foreign participants.
  • Joint accounts with rights of survivorship for both U.S. domestic and foreign participants.
  • Joint tenants in common accounts for domestic and foreign players.
  • Custodial accounts exclusively for domestic participants.
  • Traditional IRA’s for U.S. citizens.
  • Roth IRA IRA’s for U.S. citizens.
  • Rollover IRA’s for U.S. citizens.
  • SEP IRA’s for U.S. citizens.
  • Corporate accounts for both U.S. domestic and foreign participants.
  • Limited Liability Corporation (LLC) accounts for domestic and foreign players.
  • Investment club accounts exclusively for U.S. based investment clubs.
  • Trust accounts for domestic and foreign players.
  • U.S. partnership accounts

The company offers trading in several investment products like stocks, options, futures, mutual funds, bonds, other fixed income securities and exchange traded funds (ETFs). The commission structure and other requirements are as follows:

  •  Stocks and ETFs can be traded at $2.50 per trade, with a surcharge applied to trades done in extended hours.
  • Options can be traded for$2.50 plus $0.50 per contract.
  • Mutual funds can be purchased and sold for $2.50 per order.
  • A minimum balance of $2,500 must be maintained at all times.

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Key features:

  • Equipped with technical analysis tools such as stock alerts, and other daily technical insight.
  • With stock alerts the trader can set trading criteria on a particular stock and receive email alerts when these criteria are fulfilled.
  • Also equipped with fundamental analysis tools with the aid of stock screeners.
  • With a stock screener the user could search for stocks that match his or her specific criteria, like the industry, trading volume, price to earnings (P/E) and sales (P/S) ratios and other company fundamentals.

 

 

Advantages:

  • Among the lowest commissions offered in the industry.
  • Free streaming live Level I or Level II quotes from major exchanges such as the NYSE, NASDAQ and AMEX.
  • Quality research from Morning Star provided to its clients free of charge.
  • Free dividend reinvestment including reinvestment in fractional shares.
  • Very low margin rates.

Drawbacks:

  • An additional cost of $0.003 per share applies to trades on the ECN done during the extended-hours sessions both pre-market and in after hours trading.
  • A $25 IRA setup fee, a $75 IRA closing fee and a $35 annual fee are charged for IRA accounts if they have less than $25,000 in assets.
  • Poor customer service as communication with the company occurs primarily through email.
  • Incorrect cash balances and other account balance discrepancies frequently prop up in client accounts.
  • There is an options exercise and or assignment fee of $20 for each exercise or assignment done.
  • Checking & VISA debit cards incur fees ranging from $50 for Gold clients to $75 for Platinum rated accounts.
  • A minimum of $2,500 is always a balance requirement.
  • Not much support for beginner or novice investors/traders.
  • Poor range of mutual fund choices.
  • Client complaints on random cancellation of outstanding orders.
  • Can’t trade many securities during extended hour sessions.
  • Account set up and funding takes a long time.

Peer Comparison:

When compared to Charles Schwab (NYSE:SCHW) the dominant player in the brokerage space Stockbrokers.com rates Just2trade favorably only on the commissions incurred by the end user. Just2trade rates below Charles Schwab in several key areas such as the range of investment offerings, the available research tools, customer service, the ease of use, education of its users and mobile trading facilities.

When compared to E*TRADE Financial Corporation (NASDAQ:ETFC) Just2trade fell behind in several of the above areas rating favorably only in terms of the commission it charges its end users.

When compared to rival ShareBuilder Just2trade ranks favorably on the commissions charged and on the range of investment offerings.  Just2trade however ranks lower on its mobile trading platform and research tools provided. Both companies rate equally in all other areas.

Just2trade ranks below its rival Scottrade when rated on the basis of its investment offerings, ease of use and investment research capability. It exceeds Scottrade only on the commission rates charged.

Summary:

Just2trade is an on-line brokerage firm that targets predominantly experienced traders who have at least two years of experience. The company’s offerings are definitely not the right choice for new investors. Given the annual IRA maintenance and set-up fees charged it is also not a good fit for an individual retirement account. There are far better IRA companies that don’t charge retirement account and inactivity fees.

While commissions are among the lowest in the industry the surcharge incurred for extended hours trading is not appealing. Customer service is minimal and its clients are expected to be self dependent.

The account opening procedures are cumbersome and take a long time. In addition a problem Just2Trade users experienced was that they had to constantly monitor their account balances to make sure they were correct. This will not inspire confidence in its user base.

Just2Trade’s client base consists of experienced traders who require cheap executions. There is little in terms of learning materials for beginners, there is no online trader community and no virtual trading environment where traders can test strategies. For these reasons, the firm is not a good choice for a broker for beginner investors.

Any broker without a long term strategy is not bound to be successful in a highly competitive industry with predatory pricing. Low commissions may just prove to be a marketing gimmick to lure new customers. Building a stable base of customers requires a serious upgrade to Just2Trade’s existing platform.

Customer service must be significantly improved to keep its experienced traders happy. There are other top brokerage firms like Charles Schwab and E*TRADE that offer competitive commissions, fewer fees and don’t have the problems that seem to affect Just2Trade.

 

 

 

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