E*TRADE from Morgan Stanley has become a well-known name for those looking to Buy Stocks Online, largely due to its appealing offer of $0 commission for online trades of US-listed stocks, ETFs, mutual funds, and options. This offer has significantly lowered the barrier for entry into the stock market, making investing more accessible to a broader audience. But is it the right platform for you to start your online stock trading journey? Let’s delve into the details of E*TRADE’s offer and what it means for investors.
E*TRADE’s zero-commission structure applies to a wide range of securities, including stocks listed on US exchanges and Exchange Traded Funds (ETFs). For investors keen on diversifying their portfolios, the inclusion of mutual funds and options trading at a reduced contract fee further sweetens the deal. The standard options contract fee stands at $0.65 per contract, with a reduced rate of $0.50 for active traders executing 30 or more stock, ETF, and options trades per quarter. However, it’s important to note that this $0 commission offer is specific to retail online trades and does not extend to Over-the-Counter (OTC) securities, foreign stock transactions, large block trades requiring special handling, futures, or fixed income investments. Additional charges may apply for broker-assisted trades and regulatory or exchange fees. For a comprehensive understanding of their pricing model, you can visit their dedicated pricing page at etrade.com/pricing.
Special Offer for New Brokerage Accounts
To attract new clients, E*TRADE is currently running a promotional offer: new customers opening a single, non-retirement brokerage account and funding it with $1,000 or more within 60 days of account opening can benefit from a cash bonus. By using the promo code ‘OFFER25’, new investors can get a head start on their investment journey with extra capital.
Eligibility for the New Account Offer
This offer is specifically designed for individuals who are opening their first E*TRADE self-directed brokerage (non-retirement) account. It’s crucial to understand that this offer is for new clients who do not currently hold an E*TRADE account and do not intend to open additional E*TRADE accounts within 60 days of enrolling in this promotion. Existing E*TRADE clients or those planning to open multiple accounts should refer to the separate terms and conditions available on E*TRADE’s website, which are tailored for different scenarios.
Bonus Tiers and Payout Structure
The cash bonus you can receive is tiered based on the initial deposit of new funds or securities from external accounts within the first 60 days of opening your account. The reward structure is as follows:
| Deposit Amount | Cash Credit |
|---|---|
| $1,000 – $4,999 | Varies |
| $5,000 – $19,999 | Varies |
| $20,000 – $99,999 | Varies |
| $100,000 – $199,999 | Varies |
| $200,000 and above | Significant Bonus |
For deposits under $200,000, the cash credit is typically paid within seven business days after the 60-day deposit window closes. For larger deposits of $200,000 or more, E*TRADE offers a faster payout. You’ll receive an initial cash credit shortly after making the deposit, with any additional bonus amount (based on the final tier achieved at the end of the 60-day period) paid out after the 60-day window. This tiered system ensures that investors with larger deposits can access a portion of their bonus sooner.
Important Rules and Limitations
It’s essential to be aware of the rules and limitations associated with this offer. Firstly, the offer is exclusive to self-directed, non-retirement brokerage accounts. Secondly, the deposited funds or securities must originate from accounts outside of E*TRADE and must remain in the new account for at least twelve months post the 60-day funding period. Withdrawals during the 60-day promotional period could lead to a reduced bonus or forfeiture of the reward. Assets transferred from existing Morgan Stanley AAA brokerage accounts may not qualify for the bonus, at E*TRADE’s discretion.
Certain account types, such as business accounts, retirement accounts, advisory accounts, E*TRADE Futures accounts, Morgan Stanley AAA brokerage accounts, and Morgan Stanley Private Bank accounts, are excluded from this offer. The offer is also not available to non-U.S. residents or residents of jurisdictions where the offer is not legally valid. It is also important to note that this offer cannot be combined with other E*TRADE promotions, and each client is generally limited to a maximum of two new account offers. E*TRADE retains the right to modify or terminate this offer at any time.
Tax Implications and Disclaimer
It’s crucial to remember that E*TRADE bonuses and offers may be subject to US withholding taxes and reporting. The responsibility for any tax liabilities arising from these credits or offers rests solely with the customer. Specifically, cash credits for Individual Retirement Accounts are treated as earnings for tax purposes. E*TRADE, like Morgan Stanley Smith Barney LLC, does not provide tax advice, and it is always recommended to consult with a qualified tax advisor regarding your personal financial situation.
Disclaimer: This article is for informational purposes only and should not be construed as financial advice or an endorsement to buy, sell, or hold any specific security or open an E*TRADE account. Investing in the stock market involves risk, and it is essential to conduct your own thorough research and consider your financial circumstances before making any investment decisions.
Conclusion: Is E*TRADE a Good Choice to Buy Stocks Online?
For individuals looking to buy stocks online with zero commission fees and potentially earn a cash bonus upon sign-up, E*TRADE presents a compelling option. The platform’s offer lowers trading costs and provides an incentive for new investors to get started. However, it’s vital to understand the terms and conditions of the offer, including eligibility, bonus tiers, and any limitations. Considering your investment needs, trading style, and familiarity with online trading platforms will help you determine if E*TRADE is the right brokerage for your financial goals. Always remember to invest responsibly and seek professional advice when needed.
