When it comes to choosing an online broker for trading, two platforms often stand out: eTrade and Public. Both brokers offer a range of services aimed at helping investors and traders manage their portfolios, but they each approach the market differently. This article will provide an in-depth comparison of eTrade and Public, examining their features, costs, investment options, ease of use, customer service, and more. By the end of this analysis, you will have a clear understanding of the strengths and weaknesses of each platform, enabling you to make an informed decision about which one suits your needs.
1. Overview of eTrade and Public
eTrade: A Legacy in the Industry
eTrade is one of the oldest and most established online brokerage platforms. Founded in 1983, eTrade has been providing brokerage services for individual investors for decades. It is known for offering a wide range of investment products and tools, making it a popular choice among active traders and long-term investors alike. With its long history, eTrade has earned a reputation for reliability, advanced trading platforms, and robust research tools.
Public: A Newcomer with a Social Twist
Public, on the other hand, is a relatively new entrant in the online brokerage market. Launched in 2019, Public aims to make investing more accessible by focusing on a social and community-driven approach. Public emphasizes a user-friendly platform with zero-commission trading, designed to attract younger, tech-savvy investors. The platform allows users to see what others are investing in and share their portfolios in a public, social setting, making it an attractive choice for beginner investors who want to learn from others.
Summary:
- eTrade has a long history and offers a wide range of investment products, making it suitable for more experienced traders.
- Public focuses on a social and community-driven approach, targeting new investors with a user-friendly platform and zero commissions.
2. Account Types and Investment Options
eTrade: Extensive Account Choices
eTrade offers a variety of account types to suit different investing goals and strategies. These include:
- Individual Brokerage Accounts: Standard taxable accounts that offer flexibility for buying and selling investments.
- Retirement Accounts (IRA, Rollover IRA, Roth IRA): eTrade provides a comprehensive selection of retirement accounts for tax-advantaged investing.
- Trust Accounts: For those looking to manage investments on behalf of others, eTrade offers trust accounts.
- Custodial Accounts: These are designed for parents or guardians who want to invest for their children’s future.
In terms of investment options, eTrade offers a wide variety:
- Stocks and ETFs: eTrade provides access to thousands of individual stocks and exchange-traded funds (ETFs), offering a range of investment opportunities for traders and investors.
- Options Trading: eTrade is known for its advanced options trading platform, making it an excellent choice for active traders who engage in complex strategies like spreads and straddles.
- Mutual Funds and Bonds: Investors can access a variety of mutual funds and bonds through eTrade, including both actively managed funds and index funds.
- Futures and Forex Trading: eTrade also supports futures and forex trading, which can be attractive to more experienced traders.
Public: Focus on Simplicity
Public offers a more streamlined set of investment options. The platform primarily focuses on:
- Stocks and ETFs: Public offers a selection of individual stocks and ETFs, but the range is more limited compared to eTrade. This makes it easier for beginners to navigate, but it might not be suitable for more seasoned traders looking for a diverse set of investment options.
- Fractional Shares: One of Public’s standout features is its offering of fractional shares, allowing users to invest with smaller amounts of money in expensive stocks like Amazon or Tesla.
- Cryptocurrency: Public allows users to trade cryptocurrency, offering access to popular assets like Bitcoin, Ethereum, and others.
- Social Investing: The most unique feature of Public is its social investing aspect. Users can view other investors’ portfolios, track their performance, and engage with the community.
Summary:
- eTrade offers a broad range of investment options, including stocks, bonds, ETFs, options, futures, and retirement accounts, making it ideal for more experienced traders.
- Public offers a more limited set of investment options but focuses on simplicity and social investing, making it perfect for new or beginner investors.
3. Fees and Commissions
eTrade: Transparent Fee Structure
eTrade’s fee structure has evolved over the years. For most individual investors, eTrade offers commission-free trading on stocks and ETFs. However, there are some fees to be aware of:
- Options Trading: While eTrade does not charge commissions for buying or selling options, it does charge a fee of $0.65 per contract.
- Mutual Funds: eTrade charges transaction fees for buying or selling mutual funds, which can range from $19.99 to $49.99, depending on the fund.
- Account Maintenance Fees: eTrade does not charge monthly maintenance fees for its brokerage accounts. However, there may be fees for services like wire transfers or paper statements.
eTrade is transparent about its fees, and the platform is designed to cater to active traders who may incur fees related to options, futures, and mutual funds.
Public: Zero-Commission Trading
Public differentiates itself by offering commission-free trading on stocks, ETFs, and cryptocurrency. This is one of the platform’s key selling points, as it allows users to invest without worrying about hidden fees eating into their returns. Public also does not charge a fee for account maintenance or inactivity, making it an attractive choice for beginner investors who want to avoid costly fees.
While Public does not charge commissions, it does make money through a method called “payment for order flow.” This practice involves receiving compensation from market makers for routing trades to them, which is a common revenue stream for commission-free brokers. However, Public is transparent about this and ensures that it doesn’t affect the price of trades.
Summary:
- eTrade offers commission-free trading on stocks and ETFs but charges fees for options, mutual funds, and other services.
- Public offers zero-commission trading on stocks, ETFs, and cryptocurrencies, with a revenue model based on payment for order flow.
4. Trading Platforms and Tools
eTrade: Advanced Trading Platforms for Experienced Traders
eTrade provides two primary platforms for traders: the eTrade Web Platform and Power E*TRADE.
- eTrade Web Platform: This is the basic platform, which offers a user-friendly interface for beginners and casual investors. It includes basic charting tools, real-time market data, and research tools.
- Power E*TRADE: This is a more advanced platform, designed for active traders. It includes advanced charting tools, real-time data, options analysis tools, and a customizable interface. It’s ideal for options traders and those who need more powerful tools for market analysis.
eTrade also offers a mobile app, providing access to account management and trading on the go. The platform supports various order types, including limit, market, stop-loss, and trailing stop orders.
Public: Social and Simple
Public’s platform is designed to be simple and easy to use. It features a clean, modern interface that’s perfect for beginners. The main focus is on ease of navigation, and the social aspect of the platform is integrated into the design. You can follow other users, see their portfolios, and even copy their trades if you wish.
While Public’s platform is intuitive, it lacks some of the advanced tools and features available on eTrade. For example, it doesn’t offer in-depth charting or advanced technical analysis tools. However, it does provide basic charting for stocks and ETFs, which is sufficient for casual investors.
Summary:
- eTrade offers advanced trading platforms with powerful tools for active traders and options enthusiasts.
- Public focuses on simplicity and social investing, offering an easy-to-use platform without advanced trading tools.
5. Customer Service and Support
eTrade: Comprehensive Customer Support
eTrade offers a wide range of customer support options, including:
- Phone Support: Available during business hours, eTrade’s phone support is responsive and knowledgeable.
- Live Chat: The live chat feature on eTrade’s website allows users to quickly get in touch with customer service representatives.
- Email Support: Users can email eTrade for assistance with non-urgent issues.
- Help Center: eTrade’s website also includes a comprehensive help center with FAQs, video tutorials, and guides.
Given eTrade’s long-standing reputation, its customer service is robust and well-established.
Public: Limited Customer Service Options
Public’s customer support is available through email and in-app chat. While the company does offer responsive support, it lacks the more traditional phone support that eTrade provides. However, Public’s customer service is known for being friendly and helpful, particularly for new investors who may need guidance with basic platform functions.
Public also offers a robust knowledge base, where users can find answers to common questions and learn about the platform’s features.
Summary:
- eTrade offers comprehensive customer support with phone, live chat, email, and a help center.
- Public’s customer support is more limited, offering email and in-app chat but without phone support.
6. Security and Regulation
eTrade: A Well-Regulated Platform
As a major online brokerage, eTrade is regulated by several authorities, including the U.S. Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA). eTrade also participates in the Securities Investor Protection Corporation (SIPC), which provides protection for customers in case the firm fails. eTrade uses industry-standard encryption and security measures to protect users’ personal and financial information.
Public: Secure but Newer
Public is also regulated by the SEC and FINRA, ensuring a high level of security for its users. While Public is a newer platform, it adheres to the same security standards as other major brokers, including encryption and two-factor authentication (2FA) for account protection. However, as a newer player, Public may not yet have the same track record as eTrade in terms of long-term reliability.
Summary:
- Both eTrade and Public are regulated by the SEC and FINRA, with industry-standard security features like encryption and 2FA.
- eTrade has a longer history and established track record, while Public is newer but still adheres to high security standards.
Conclusion: Which Broker is Right for You?
In the battle of eTrade vs Public, the right choice depends on your needs as an investor. If you are an experienced trader or someone who values a wide range of investment options, advanced trading tools, and comprehensive customer support, eTrade is likely the better fit for you. On the other hand, if you are a beginner investor looking for an easy-to-use platform with zero-commission trading and a social investing experience, Public could be the ideal choice.
Ultimately, both platforms offer unique features, and your decision should be based on your investing goals, experience level, and personal preferences.
