Saturday, March 17, 2012

Final Review: SureTrader


This is a followup to my initial review of the new broker SureTrader based out of the Bahamas. I've copied that initial review into this post so as to add to and comment on my previous ideas. I will also modify the color of the initial reviews text to make it easier to follow along.

Also just to give some context to this review, I was a customer for about 3 months and I only used the free web-based SureTrader 2.0 platform. Since I use another broker for market data, I am not subscribed to any premium SureTrader service.

The account opening process was also a huge hassle for me (it took about a month and half). My wire bounced back the first time, and the second attempt went through but wasn't properly attributed to my account. Eventually I was able to contact them and they were able to identify the wire that came from me and credit my account. I've opened several other brokerage accounts in the past and never had so much trouble as I have with SureTrader.
So after deciding to setup an account I was quickly met with some troubling aspects of the brokerage. Basically, their website it horrible. The first thing that tipped me off was the fact that it is formatted so all your typing is in caps. The second clue was a typo of the word "your" as "yout" which means they didn't even bother to spell check their web content and generally just indicates they threw this together too quickly.
I still maintain their website is pretty bad but it is manageable. Now that I'm more familiar with it, I find the lack of features more troubling. There is no way for me to view my past trades which is a major shortfall.
Now to the more serious qualms. Compare the URL bar of your trusted broker with that of Suretrader. Whenever you are dealing with sensitive info/documents at a place that cares about your privacy and security, you will see the prefix https://... which is indicative of a secure connection. This is sadly not the case at Suretrader which makes me apprehensive about submitting my personal information to them. It's not even that I don't trust them but rather that the information is retrievable by third parties with malicious intent. My fears were further realized today when I was posting a document to my dropbox. Upon doing so, the page refreshed and I was somehow looking at dropbox files from several other accounts. I mean how disturbing is that? The only reassuring thing is that since you can't even access your own dropbox files after submitting them, I wasn't given the ability to look at other peoples files but I was able to see the file names and descriptions. Thus I think it is important to warn others at least to exclude any personally identifying information from these fields in case such an error occurs again.
Since writing this, the problem has been resolved, at least in terms of the secure website with a "https" web address. Since I don't need to use the dropbox anymore as an approved customer I can only assume that this issue has been resolved as well. However, I have had issues with letting my session time-out and then when I refresh the page I am redirected to a server error page rather than a custom error page. Admittedly this is a minor and aesthetic issue but again speaks to the amount of time that went into the website before its launch.

Overall though I think I would have to recommend against this broker since its main appeal is the lack of the PDT rule since it resides outside the jurisdiction of the SEC. The reason for my discontent is the commissions which really eat into a small account (which you have if you're looking to avoid the PDT rule). At the time of this writing they are $4.95 for the first 1000 shares and then $0.00495 for every 1000 shares after that. While this isn't horrible, it really sucks for penny stocks which you might be interested in if you were referred to SureTrader through Timothy Sykes. Consider the following scenario:

You have only $2,500 in your account and want to buy SNPK at 0.67, so you purchase 3,000 shares (risking 80.4% of your account). That is $14.85 in commissions just to open your position. The stock runs to 0.72 and you look to get out. So in making this best case scenario trade, you only make $120 while risking a huge amount of your account. That's certainly an inherent disadvantage of a small account but it just feels aggravated by SureTrader's fees. You have to trade perfectly to make money since mistakes cost you big time in terms of commissions. If the previous scenario doesn't bother you, than cool. This is just my opinion after all. I just wanted to point out that the two attractive qualities of SureTrader at first glance (low account minimum + no PDT rule) may not be so attractive once you've thought about it a bit more.

Another supposedly great feature of SureTrader is their great borrows for shorting stocks. From my limited experience at this broker, I have not seen good borrows. In fact, I've attempted to short 5 or 6 stocks that were available to borrow elsewhere and not been able to get shares. This is a HUGE problem for me and if you have any plans to short with SureTrader I suggest you wait to open an account when they get their superior borrows back. In the mean time you can make more money by keeping your capital in an account such as Interactive Brokers (Tim is in the process of making sure SureTrader can get Interactive Brokers' borrows as well so this may be a non-issue in the future).

One good thing I can say about SureTrader is that I have found their customer service to be helpful. It is far from efficient but every problem I have had, I get an answer to in a very reasonable amount of time by seemingly friendly staff. Other brokers just send you an automated response that vaguely relates to your issue and they let you figure out the details on your own.

Some additional complaints I have heard from others:

ST software occasionally goes down during trading hours. This complaint seems only to occur for those using the free web-based trading platform and not the premium PRO platform. One customer who experienced this allegedly lost money as a result of this downtime and received the following response from support following the incident: "SureTrader does not reimburse clients for losses incurred due to trading malfunctions or system disruptions. Please make reference to our risk disclosure found on our website."

32 comments:

  1. Hey, just wondering if you are still using SureTrader? How has it been? Have you withdrawn money?

    Thx

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    1. Yes I am still using ST with a small amount of money. I have not tried to withdraw money yet though.

      I do have two things to add since writing the review, both having occurred very recently. The first is that I heard people who got borrows to short yesterday on GENE received forced buy-ins just a half-hour to an hour after taking the short position. While any broker has the right to do this, it is uncommon and basically it just sucks really badly.

      Also earlier this morning the web-platform was down for the first half-hour of trading. According to others, the paid platform did not experience any downtime. Software issues happen with all brokers from time to time but this was the first time it had been completely down for me.

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    2. One benefit is that suretrader allows trailing stop orders on OTC/Penny stocks. Scottrade does not.

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  2. "You have only $2,500 in your account and want to buy SNPK at 0.67, so you purchase 3,000 shares (risking 80.4% of your account). That is $14.85 in commissions just to open your position."

    Come on, man. For one, you're risking a daytrading account playing TRASH. Yes, I played SNPK, and I made around 70% on it. How large was my position you ask? $1,000, which is about 5% of my TOTAL account. Why would you EVER risk 80% of your account on something that can give you a 50% haircut in minutes? Your review and your points are moot.

    P.s. Just opened up a suretrade account. I've been trading for 4 years. I am positive my experience will be completely different from yours.
    At the very least, trade there for a few months before posting a review.

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    1. I don't think my points are moot at all considering that one of the main attractions of the broker is the way around the PDT rule. That being the case, many of the customers will have small accounts (<25k). I also think its a fair assumption to say that those people with smaller accounts are either a) less experienced or b) poor traders who may benefit from a seemingly obvious lesson and example.

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  3. I was going through same hell trying to setup an account with them, they are idiots, I think that if they are lousy at setting up an account, how can you be sure your money is safe in this international brokers hands? I gave up on them.

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  4. I just opened up an account with them and will be trading soon. But I agree there are a lot of troubling problems. The website really does suck, compared to my Scottrade account which has a stellar website that gives you tutorials on just about any subject so you can become knowledgeable about trading and using the platform.

    Yeah, speaking of the platform, 2.0 sucks really bad. I immediately noticed the lack of features. Moving average lines are available but no oscillators. You can't draw trendlines, the crosshairs mouse-over doesn't work, and the time intervals are limited to 1 day at the longest, so no looking up charts by the week. I've voiced my concerns about this, and about not being able to update my password and I hope to get word back. My feeling is that upgrading to their pro platform will only remedy a few of these concerns.

    Overall I'm doing this because the SEC rules keep day traders with less than $25k from making any money. Every time I enter a trade, I'm reticent to exit because I only get 3 day trades a week. I've also calculated that paying $4.95 per trade as opposed to Scottrade's $7 will more than make up for the $100 wire fee when I make withdraws. The 6:1 margins are also important when compared to 3:1 stateside margins and 2:1 for initial trades. The deck is stacked too far against small traders in the U.S., so we have to look elsewhere.

    I guess we have to consider that offshore trading catering to U.S. residents trying to evade the PDTR is in its infancy. Since Suretrader was started by an American, I'm disappointed that it doesn't incorporate American sophistication in trading brokerages, but hopefully time...and competition..will improve the quality of Suretrader's service.

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  5. Any recommendations for someone in Canada? Suretrader the best?

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    1. Sorry I missed your comment. Unfortunately, I really don't have any experience with brokers available to Canadians so I can't say much on the subject anyway.

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  6. Thank you for your review... Many traders are well to stay away from this offshore broker until they can improve their services... namely its borrows for short selling...

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  7. Garbage, dont waste your time , the last 4 times I tried shorting the web app hangs, lost opportunities to make real money, whats the use to have a broker with lots of shortable stocks when the app wont work.

    I tweeted the suretrader ceo and his excuse is that their new ...

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  8. HI,
    How was your mentoring experience with Tim sykes?
    After 1 year, will you recommend trading with SureTrader or Interactive Brokers?
    Any issues with withdrawal of funds from them?

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    Replies
    1. I would still strongly recommend Interactive Brokers over SureTrader however I didn't have any great issue with withdrawal. I did have to submit my request via fax however and there were two conflicting fax numbers listed for where to send it. How would you like it if you accidentally sent your personal account info to some random number? Luckily that didn't happen but it seems reasonable to expect some secure online method. Perhaps that has been implemented at this point but not when I did it.

      As for Tim Sykes, I have mixed emotions. He's definitely a respectable trader but he has his flaws as well. I was thinking of doing a full blog post on him and his services so I'll try to get that started.

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  9. Thanks for taking the time to put this blog together regarding your opinions of Suretrader. I'll stay away for now.

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  10. I suspect all the negatives will be greatly overcome by ability to escape the strict SEC rules applied only to stateside citizens....

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    1. I heard as recently as last week that their servers were down in the middle of the trading day. Their terms of service say they aren't responsible for losses in such a situation so I wouldn't consider risks like that to be worth it for any reason.

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  11. Their website blows. I just got charged tons of fees im trying to fight but theyre a compnay in the bahamas so there is very little recourse. Im talking about over $600 in fees they did not tell me about or something I never signed up for.

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  12. Hey People,

    The forced buy in sounds very crappy on their part, what is up with this brokerage firm? Etrade was a screw ball brokerage back in 1996-1999 when their data was lagging, it took forty-five minutes to get information if you had received a fill on your order and often I would end up in a 'boxed postion.



    Why not open up three or four small accounts with Just2trade and lower your trading down to 16 day trades per week. I use to make 50,000 to 80,000 day trades with these stupid brokerages, the ones who make the money are the brokerages, we are trying to win at a ratio of 48 percent, why put yourself through the hassale of some Bahama Mama brokerage to avoid something the SEC is trying to help.


    Why dont' we start a petition to fight against this? I am now hearing HFTS computers are doing 60 to 70% of all volume of the markets in the United States. How do you like trying to bid for or throw offers with these dam computers who front run us?



    Trader Jason since 85

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  13. Hello, I've stumbled across your blog and found it quite helpful, unlike so many other stock websites.

    For awhile now, I've been trading using stock games where nothing is actually invested, and have been quite successful.

    I'm wondering what broker you recommend for someone with a little over $2000 to invest. (Note: Since I'm starting out, at first not all the funds will be used for trading - the amount is picked so I have more brokerage options)

    A lot of my trades have been shorting penny stocks, so I'm looking for a broker that is good for this. Also, the lower the fees, the better. The PDT rule isn't too important to me because I make very few day trades.

    Any recommendations? Thanks!

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    Replies
    1. Hey Stephen,

      I'll do a post on the details but the short answer is that it's not in your best interest to trade with such a small sum. I know that's not what you want to hear but the fact is that you will probably lose money by attempting it.

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    2. Hi, thanks for the quick reply!

      You're right that it isn't what I wanted to hear, but I'd hear stuff I'm not eager to hear rather than losing money. From my experience in trading games it seems that I can make money trading, however, I don't just want to hear my side before deciding. I look forward to your post!

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  14. This is an awesome review, thanks for saving me the time and trouble.

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  15. This comment has been removed by a blog administrator.

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  16. Been with suretrader over a month. Not a really good experience, all of the complaints mentioned above has happened to me. Also, I and a few others are having a difficult time withdrawing funds. They keep saying they dont receive the fax but my machine says it went thru successfully.. something is fishy here and there is no feeling like thinking you might not get your money back.. this is a common complaint on the profitly forums.. I wonder why Tim and crew recommend these guys. All i can say is that I am pretty pissed right now that i have to go thru all this to get my money out.. On ameritrade you fill out a form and your money is at your door next day.. Really nervous....

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    1. I'll tell you why Tim Sykes and his peers recomend Suretrader. No doubt they receive monetary compesation for flocking junior traders to the brokerage. Lack of borrows aside, there is no excuse for the plethora of issues people experience with them.

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  17. I tried to open an account using a mac...big error. The system seems to only work in IE on windows. What is up with that?

    I tried to find out how much they are charging for a voluntary reorg fee. No dice. They don't understand what that is!
    Here is my review of discount brokers and fees;
    http://www.docjava.com/comput_1/brokers.htm
    BTW; suretrader is not related to the old suretrade.com, which is now defunct.

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  18. Here is a follow-up. Suretrader will not take a check, only wire transfers or a credit card. Also, Suretrader will not enable participation in voluntary corporate actions.

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  19. Besides Suretrader, what is out there to short penny stocks with limited or no restrictions? Does anyone know?

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    1. Well if your concern is primarily the pattern day trader (PDT) rule, you don't have many options. The brokers would have to be outside the US (just as ST is), but that carries a lot of risk. I'm not familiar with other brokers that evade that rule. I would just advise you start saving money so the rule won't apply to your account ($25k+)

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  20. Im looking to open an account and mainly focus on shorting penny stocks but im trying to find the best online broker for this. I was wondering if your still using Suretrader and if you have tried to withdraw money yet? Wondering if there was any issues for withdrawing money from your account?
    Ive spoke to plenty of online brokers and honestly from speaking with them i think Etrade is going to be the best for trading penny stocks - although they are expensive with 9.99 per trade they allow you to short plenty of penny stock but you have to have collateral in your account to match your trade.
    Suretrader does offer you low commission and no PDT restrictions but its just sounds like a sketchy site and the reviews people have giving sure do prove that to be true.

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    1. I don't use them anymore but as the comments show, they don't seem to have improved since I left.

      Getting my money back was pretty sketchy because I had to fax my bank info to them on a form they provided from the website. That just strikes me as ridiculous and insecure.

      I would certainly recommend Interactive Brokers over Etrade. I have a short review here: http://indoortrades.blogspot.com/2012/04/review-interactive-brokers.html

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  21. You can learn just general good trading techniques from pennystk.com and you can find out how to make passive income as you take a shit

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