Schwab anyone?

Discussion in 'Retail Brokers' started by mayhem28, May 24, 2010.

  1. mayhem28


    Anyone here who uses Schwab are they a progressive broker? Any cool tools or software they have (particularly for options trading, position analysis, etc. like thinkorswim have?) I have heard they are a pretty old school broker that hasn't caught up with the times? I will be opening an account with Schwab Global if that helps

  2. I think that I saw somewhere that Schwab had ETF's that you could trade for free.
  3. parity


    Schwab is good if you want more of a "bank like" brokerage. They also offer excellent research and a variety of investment options. If you want to trade in volume, I would not recommend them. Their "premium" trading platform is StreetSmart is average to poor for high volume trading. I have an account with them but use it more for banking, IRA, and my kids collage fund. Schwab is great imo if you know what to expect from them ahead of time, ie NOT geared toward the serious trader.
  4. Stay away from them, when the market crashed two weeks ago, there site and phone lines were down during that time.
  5. I was looking at Schwab (they seamed like a leader then) around 10 years ago, when I was first considering online stock trading, before my life went down another road.

    I would be interested in people's opinion's of how to summarize in one or two sentences how the Schwab, and the market in general (in software for stocks trading) has developed since then?

    I am currently starting to trade Forex with PT multistation, but this terminal also supports trading stocks, futures, oiptions, CFDs, betting, etc.
  6. I traded with Schwab through 2008. They have a platform named StreetSmart Pro, which uses technology from Cybercorp, a daytrading firm they bought 10 years ago. I liked the platform. It was very intuitive and responsive (it had a memory footprint of around 18MB, so I never really experienced the lag that I saw with java apps from other brokers that grew to 200 or 300MB, back when I had a 1GB system). Charts were clean looking, very customizable, and came up almost instantaneously. SSPro didn't offer what some daytraders want, such as futures trading (unless you were a former Cybercorp customer) and a DOM ladder interface. The way you trade is to open a level II window that has some fields and buttons at the top. The size can be defaulted, and the price can be filled in by clicking on a price in the level II display. You then click on buy, sell, or short buttons. It was fast enough for me, but I understand some daytraders need single-click order entry.

    Hundreds of stocks were categorized into industries and subindustries, so you could, say, bring up a watchlist of several dozen oil drilling and exploration stocks immediately if you wanted to. Options windows could show all the greeks. Option spread windows would show real-time bids and asks, although IIRC you had to choose a particular destination rather than being shown the prices based on the NBBO. There was a reasonable alert system that could optionally be used to place orders; downside was that it only operated during regular trading hours, and if one of my long holdings popped after hours I would have wanted to know about it.

    Aside from the platform: First the good: Schwab treated active traders very well. The phone was picked up within a ring or two. They never dodged questions about system failures. When one of my holdings gapped up by 40 points one day, I got a call about it from one broker there, who was proactively calling every active trader in that stock to let them know. Schwab has lots of local offices; instead of spending 10 to 15 minutes at your bank setting up a wire transfer that will get done some hours later, at Schwab you go in, hand them a check, and you're out in 2 minutes.

    The bad: quotes lagged during high market activity, such as FOMC decisions. Commissions were not as low as many direct access brokers. They did not route to BOX, and in trading thousands of SPY options over several years I never got even one instance of price improvement. They did some sort of account reconciliation every day from 16:00 to 16:15, and you couldn't get stock orders executed during that time unless you direct routed to an ECN (and there were reports here, in the long Cybertrader integration thread, that you couldn't short when direct routing to an ECN). If your trade would put you beyond your overnight buying power, the order would often be subject to review by a human, which could take several minutes (and if it was a market order, it was uncancellable during this time).
  7. Schwab is a reliable broker that is not going to go out of business or rip you off through some scam, but they have pretty much written off the active trader segment. StreetSmart Pro is a decent platform with very good charting. When they folded Cyber into SSPro they ditched some of the more sophisticated Cyber features that appealed to daytraders. A Schwab rep told me candidly they did it because Cyber had 8,000 accounts and SSPro had something like 200,000 and they couldn't devote the bandwidth.

    Some of it was just stupid. For example, on Cyber you could set a default for how much size you wanted to show on any order. On SSPro you have to do it manually each time. The Day Trade BP window never gives the correct number, as it excludes cash that is in a sweep. Very annoying.

    Old Cyber Trader customers still get per share pricing, but otherwise it is per trade, which is not really feasible for day traders. Also, while you can select NAS or ARCA routing, there are no rebates. The minimum number of trades to get the platform and its excellent charting and Lev II free is really low, like 10 a month I think, so a lot of traders keep it as a charting app and just make the minimum number of trades. Can't see how that helps Schwab but that's the way it works.
  8. The Street Smart Pro (CyberTrader) platform has a very fast data-feed. I have compared it (side by side) to the ThinkPipes professional platform offered by ToS and it keeps up tick for tick.

    The charts on Street Smart Pro are not as good as one finds on Quotetracker (my favorite for charting), but you can definitely day-trade off the Schwab Street Smart Pro platform given how fast and robust the quotes and executions are.

    Quoteracker accepts data-feeds from other retail brokers ( such as Ameritrade and Schwab ). However, in my opinion the Ameritrade "streamer" quotes are totally worthless and several seconds ( especially in Level-2 ) behind other feeds. I have complained to Ameritrade for the last couple of years about how lousy their Level-2 feed is and they just don't seem to get it.

    That is why many who use Quotetracker linked to an Ameritrade account will take the extra step of spending $45 per month and subscribing to DTN's "IQ-Feed" to pump Level-1 equity quotes thru Quotetracker. Unfortunately, this only makes things somewhat bearable for a day-trader given that you are still stuck with Level-2 quotes from Ameritrade's "streamer" feed that are horrible.

    (unfortunately, DTN does not offer real NYSE Level-2 quotes or Nasdaq "Total View" Level-2. DTN is primarily a commodity data-feed shop, and does not do a very good job of supporting equity traders. They say that they will be offering a Nasdaq "Total View" Level-2 feed early next year, but that will only be offered to support their NxCore product).

    At one time, Schwab used to pump its data-feed from "CyberTrader" ( Street Smart Pro ) thru Quotetracker. Unfortunately, Schwab does not do this any longer, and instead simply sends them (QT) a basic "snap-shot" feed. Otherwise, a remote trader could have one of the hottest set-ups there is, with minimal cost.

    As one can see, it can be quite difficult for a cost-conscious remote trader to get a chart-worthy trading platform coupled to a fast data-feed - - - all in one package.

    Interestingly enough, Schwab will be coming out with their own trading platform ( developed in-house ) by the end of this year. In fact, they will start BETA-testing it in July with real orders.

    If they upgrade the charts currently found on Street Smart Pro, and combine that with their robust data-feed they will have a winning combination in my opinion.

    Stay tuned.