TradeZero Broker Review: Best For Shorting Stocks With Small Account
TradeZero offers an alternative to short the hard-to-borrow stock without needing a large account over $25,000 during the bearish market. That's the broker you need if you're looking for a shorting broker with a small account.
I will be sharing my honest opinion about the brokers as active traders and highlighting the pros and cons of Trade Zero. So you can decide whether TradeZero is the right fit for you!
TradeZero US, CA & International: What sets it apart from others?
TradeZero is a broker first founded in 2015 in the Bahamas and is now registered with physical offices in the U.S., Canada and Bahamas. It offers commission-free stock and ETF trading and provides extensive short locates for hard-to-borrow penny stocks, with a low minimum deposit of $2,500 in USA, and $500 in Canada.
An extensive list of hard-to-borrow stock list
TradeZero has a hard-to-borrow stock shortlist. On top of that, the broker has the large-cap stocks borrowed for free. Also, the premium platform ZeroPro lets you get a credit for unused locates, so you can save fees on shorting.
Commission-free stock and ETF trading
TradeZero offers commission-free stock and ETF trading if certain conditions are met (Learn more in the fees session). You can take advantage of free commissions for high-frequency trading.
6:1 High leverage
You now can maximize your day trading and receive leverage of up to 6 to 1 with a deposit above $500, but note that the margin rate is 9%.
Smart order routing for high-speed and low-cost
TradeZero's smart router directs non-matched orders to market exchanges like ARCA, NSDQ, BATS, or EDGX for order flow or rebates. Plus, you can also have the option to send orders directly to your preferred exchange. This ensures that your order is executed at the best price and in the shortest time possible.
TradeZero Platform features: ZeroFree, ZeroPro, ZeroWeb and ZeroMobile
| TradeZero Platforms Overview | ZeroFree | ZeroPro | ZeroWeb |
|---|---|---|---|
| Description | A browser-based platform available on any connected device | The flagship desktop app | The web-based version of ZeroPro |
| Pricing | Free | $59/month | $59/month |
| Features | All platforms have charting windows, real-time news, live-streaming quotes and stock borrow locates | ||
| - | Arrows for buying and selling actions, colored blocks for price movement analysis, sets of hotkeys | ||
| Max. No of Level II Quotes windows | 1 | 10+ | 10+ |
| Max. No of Chart Windows | 2 | 10+ | 10+ |
ZeroPro & ZeroWeb: $59/month
The Zero Pro trading platform with live market data and level 2 quotes costs only $59 per month, which is significantly lower than other platforms I use. You can also have your own sets of hotkeys below the level 2 window to speed up your executions and improve efficiency. If you're interested, you can download my Zero Pro hotkey settings here.
As for ZeroWeb, it is basically the web-based version of ZeroPro but with limited charting and execution functions.
ZeroMobile: The basics are included
The mobile experience works, but it is not consistent with the other TradeZero platforms. ZeroMobile does not allow options trading, but it does have a tool for locating short stocks, watchlists, charts, and the ability to trade, but the basics are included in the app.
Availability in the U.S., Canada and international
Trade Zero was once a top choice for me as a broker, and I even reviewed it back in 2019. However, I was disappointed when they left Canada. But now, they have come back to the United States, Canada, and other countries.
Fees and charges of TradeZero: How much does it cost?
Commission fee
You can have free orders for stocks listed on NYSE, AMEX, or NASDAQ exchanges when the stock price is above $1, a limit order is used that doesn't match immediately, and the order size is at least 200 shares. (If less than 200 shares have a $0.99 flat fee.)
Deposit and withdrawal fee
TradeZero does not have any deposit fee for U.S. clients but $25 for international clients. This fee is waived with an initial deposit of $500 or more. However, there's a $50 withdrawal fee per withdrawal.
Margin rates
The margin rate is 9% if you trade with a margin on TradeZero. Compared to 6.8% on Interactive Brokers, TradeZero has a relatively high margin rate.
Options
Although the platform does not charge options trading a commission, still, there's $0.42 Options Contract fee per contract.
No inactivity fee
For either platform, there is an unqualified account fee of $5 for U.S. customers if the balance drops below the minimum balance and the account does not hold any securities.
Opening a new account with TradeZero: What is the minimum deposit requirement?
TradeZero offers a minimum account funding of $2,500 in the U.S. and $500 in Canada and other international countries to make their service more accessible to a wider audience.
However, if you open an account with TradeZero US, you will still be subject to the PDT (Pattern Day Trader) rule restriction if your account balance is under $25,000. If you are in the U.S. and want to avoid this restriction, you can open a cash account with any other broker.
Is TradeZeroSecurities safe?
Is it safe to put my money at TradeZero? Well, I would say TradeZero is regulated by multiple top-tier regulatory bodies, including the SEC and FINRA in the U.S. and CIRO in Canada, and it has a clean track record with no major regulatory incidents or fines.
Need more proof? You can also check the background of TradeZero on FINRA's BrokerCheck, where you can find all the legal disclosures of the brokers.
If TradeZero were to go out of business, the SIPC insurance coverage of $500,000 per account is available.
TradeZero Broker: Pros and Cons
Pros:
Access to hard-to-short stocks
User-friendly trading platform
Commission-free trading for real stocks and ETFs
Quick and easy account opening process
Cons:
High locates fee
A high withdrawal fee of $50
Credit/debit cards not accepted for funding
Limited product offers: Stock, ETF, Options, Cryptocurrency, OTCBB
Humbled Trader exclusive sign-up bonuses for TradeZero
TradeZero is currently running a special deal exclusively for H.T. subscribers! By signing up through Humbled Trader’s special offer, you will receive 3 months of free access to the premium platforms ZeroPro & ZeroWeb. Plus, you will enjoy a 10% discount on locate fees and a 1% cash bonus rebate on your initial deposits.
3 Months 5% Locate Discount
3 Months Free ZeroPro & ZeroWeb
1% Cash Bonus For New Accounts (capped to $1,000)
Apply now to get the time-limited offer: https://www.humbledtrader.com/tz
P.S. Demo accounts with paper trading use data that is 15 minutes delayed and are limited to a trial period of 14 days for new customers. You can try it out before getting into the real deal!
Last Note: TradeZero is the broker for beginner traders
Trade Zero is a great choice for traders interested in shorting hard-to-borrow stocks globally. They have low funding requirements, zero-dollar commissions on limit orders, and a customizable direct access platform that sets them apart from other brokers. I am excited they are available in Canada again.
In short, the TradeZero platform is ideal for day traders, active short sellers, and those seeking low-cost trading, low minimum balances, and high intraday leverage.
