Zecco Online Discount Broker Review
I started using Zecco in 2007 and I couldn't be more pleased with this trading platform. In fact, I think it could very well be the best online discount broker for swing traders.
I went through a lengthy research process before signing up. I heard a lot of complaints from traders about the amount of time it took to set up an account and how bad the customer service was.
I figured that since it was a relatively new company, there would be some initial problems. So, I decided to give it a shot.
I didn't have any problems setting up an account. I filled out the usual forms and I was approved. I didn't even have to mail them any documents. It was all done online. As far as the customer service complaints go, I don't know about that since I have never had to contact them with any problems.
One thing I liked right off the bat was the security features. You need a user name and a password to log in to Zecco. Then, after you are logged in, you need an account number and a "trading key" (yet another password!) to access the trading area.
So, I funded my account and I was ready to trade.
The trading center is extremely basic. There are no bells and whistles. It is very simple to use even for someone who has never traded a stock before.
The Zecco order entry screen
Here is a screen shot of the order entry section:
Let's go through the options here...
Transaction: In the drop down box, you will select a Buy, Sell, Short, or Cover transaction. By default, the Buy option is selected. Very simple.
Quantity: Here you will enter the number of shares that you want to purchase or sell.
Symbol: Obviously you enter the stock symbol here.
Order Type: Here you have several options in this drop down box. You can select a regular market order, limit order, stop loss order, stop limit order, or a trailing stop loss order. If you select the trailing stop order, then you can have your stop loss order move with your trade automatically by a certain dollar amount.
Limit Price: Here you can specify a price at which you want to buy or sell a stock.
Stop Price: Enter your stop loss order here
Duration: Here you have the option of specifying whether you would like the order to last for just the current day or until cancelled (Good Til' Cancelled).
AON: This stands for All Or None. It instructs Zecco to fill the entire order or none at all.
Next to the order fields you have a Preview Order button. After you decided on your order, then you have to push this preview button. It will take you to a screen where you can review your order and send it to be executed.
There is also a Quote button there to get a real time price at what your stock is trading at.
Like I said, there are not a lot of bells and whistles here compared to some brokers trading platforms. Some traders may want more options as far as order types, Level II, etc. I don't need any of that. I just want my trades executed quickly.
Updated 2012: Zecco has a new trading center!
Here are screen shots of the new trading center:
The nice thing about this new trading center is that is still very user friendly for the new trader. But, there is an advanced tab for those traders that need more control over how their trades are executed. The best part? This new trading center is organized better. You know have one-click access to your balances, positions, order status, etc.
This new trading center should satisfy everyone from the novice trader to the advanced trader!
Zecco features and pricing
Here are some of the features of the Zecco trading platform...
- There is no minimum required to open an account at Zecco. If you want a margin account, then you will need to have at least $2000.00 in your account.
- Stock trades cost $4.95 per trade. This is a pretty good deal considering that other online brokers can charge up to $10.00 per trade.
- You have access to real time quotes. You can get streaming quotes for an additional charge of $20.00 a month.
- You can become a member of the Zecco Share Community. Talk with other traders, view their account holdings, and chat about the type of trading that you are interested in.
- Trade stocks directly on your Facebook page! Zecco now has an app that allows you to "like" stocks, get real time quotes and charts, and place trades all from within Facebook!
- The mobile app allows you to track your portfolio and watch lists.
- New Zap Trade™ browser plug-in allows you to trade stocks from within your browser without having to go directly to the Zecco website.
Trading is a business. With any business you have to keep your expenses low in order to maximize your profits. Fees and commissions can add up, especially for active traders. So, $4.95 a trade is a pretty good deal (E*trade charges $9.99 a trade!)
Also, I've had no problems with Zecco executing my trades. With some discount brokers, you run into problems with shorting stocks due to some stocks not being available for shorting. I haven't had that problem yet.
You can get streaming quotes but it costs an extra $20 bucks a month. Here is a screen shot of the QuoteStream II tool:
There is another add-on that you can get which is called Quote Grid. This shows you in real time the bid, ask, volume, etc. But this also costs extra - $8.00 a month. Here is a screen shot:
These extra features are nothing more than a drain on your trading account! Personally, I think they should give the Quote Grid feature to anyone who has an account with them - without charging extra for it since this is standard with most discount brokers. Bummer.
Also, Zecco is not a direct access broker. This might be a problem for day traders who require lightning fast order fills. Zecco's trade execution is, however, 27% above the industry standard. All of my orders (so far) have been filled within a couple of seconds.
So you may be wondering, "If it costs so much less than other brokers, then how do they make money?"
Here is a quote directly from the website:
We make money from the interest on margin balances. It's a small amount, about 3%, but on a large volume of customers it becomes a tidy sum. Secondly, we keep our costs low. We don't spend $5 of every commission marketing to you. And we don't spend $400 in advertising for every new account. We attract customers like you by having the best deal in the market. Lastly, we're building an online financial community where investors can connect with investors. Where you can find all the tools and information you need to trade, plus gain access to financial blogs, forums, and up-to-the minute financial news. We think that's a winning combination for advertisers.
Seems fair enough to me.
Zecco trading video
In this video, Rebecca, one of the Zecco Zirens, talks about technical analysis. The only reason for me putting it on this review page is because I have a crush on Rebecca. Hope my wife doesn't see this page!
(I think I'm in love!)