FirstTrade offering free trades?

[Traction]

So whats the deal with FirstTrade offering completely free trades?
There has to be a catch here, does anyone know anything about them? I searched their pricing page and its very vague. How could they make money then?

 

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[lludwig]

Yes it appears legit.

How can they make money? A number of ways:

• Sell order info (like Robinhood does)
• Margin interest
• Fees paid to them when an individual uses an ETF/Mutual fund
• Managed services (I don't think they have this though)

 

[Traction]

Yes it appears legit.

How can they make money? A number of ways:

• Sell order info (like Robinhood does)
• Margin interest
• Fees paid to them when an individual uses an ETF/Mutual fund
• Managed services (I don't think they have this though)

Im with Interactive Brokers which I think is supposed to be the cheapest and my fees were $6k for the year.

Im pretty small fish but image them dropping me + every other investors trading fees in the hope of making it back in others ways as above, which I do not utilise.

Could this company be doing this to get people on their books and then they suddenly go bust?

 

[lludwig]

Could this company be doing this to get people on their books and then they suddenly go bust?

SPIC insurance protects you from fraud by the broker. So no technically your money deposited isn't touched by the broker. Meaning if they went bust you would eventually get your money back but it's nowhere near as fast as say FDIC insurance.

 

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