Stability and reliability of TradeZero

In short, yes, TradeZero can be trusted, as it is regulated by at least one top-tier financial authority. But is it the best for long-term investment?

If you're buying assets for the long term, you probably won't want to change brokers often, as such a switch can involve high costs and frustrating paperwork. But how can you tell if a broker will still be around in 10 or 20 years? Obviously you can't, but there are a few things - such as a broker's age or its background - that can give you hints about its potential longevity.

TradeZero was founded in 2,015 and does not have a banking background. Read on to see what this means for you and how this compares to the rest of the field.

My key findings in a nutshell

My key findings in a nutshell

Krisztián Gátonyi

Method-Man | Forex • Market Analysis • Stock Market

I have 15 years of experience in proprietary trading, mainly in the interbank currency market as a foreign exchange risk manager. I'm actively involved in reviewing the 100+ brokers listed on our site. I personally open accounts with real money, execute trades, test customer services. I hold an MSc in International Business from the University of Middlesex. My purpose is to help people find the best investment provider.

Learn about our methodology

Krisztián Gátonyi

Method-Man | Forex • Market Analysis • Stock Market

I've thoroughly tested TradeZero services with our analyst team by opening a real-money account and these are my most important findings:

• TradeZero was founded in 2,015; a good track record but yet to be tested by a major crisis
• TradeZero lacks the added security provided by a banking background
• Top-tier regulation is essential; stock-exchange listing is a plus

Data updated on October 10, 2023

The online brokerage market as such only really took off in the past decade or so. Therefore, most brokers do not have a lengthy track record, especially in the discount broker segment. This is perfectly fine; after all, everyone has to start somewhere. Nevertheless, how long a broker has been around can tell you a lot about its ability to survive and prosper amid often adverse market conditions.

TradeZero was founded in 2,015. It has successfully navigated the market volatility and the surge in client interest triggered by the Covid-19 pandemic, the 2021 GameStop market frenzy and the rise of crypto. However, it has yet to be tested by a major market upheaval like the 2008-09 financial crisis. To have a better idea of the stability of its operations, check out other criteria such as its background or the strength of its regulation (see more on these later).

When you choose a broker, its fees, trading platform features and product selection will probably be your top considerations. However, if it's a close call between two similar brokers, the one with the longer track record may be a better choice for long-term investors.

Data updated on October 10, 2023

No, TradeZero doesn't have a banking background.

Why does this matter? If a broker has a banking license (or is owned by a bank), it means it needs to comply with stricter capital criteria, and observe tighter rules when it comes to client deposits. In addition, a lot of banks that own online brokers have been around for decades, which can be a positive sign when trying to predict a broker's potential staying power.

Even so, a banking background does not in itself guarantee long-term stability, as banks can occasionally go bankrupt, or simply decide to wind up their brokerage operations if their business strategy so requires.

Most online brokers do not actually have a banking background (this is also true for brokers reviewed by BrokerChooser). Because of this, you shouldn't let the lack of a banking background deter you from signing up to an otherwise great broker. Rather, think of this as an extra sign of long-term stability and an added layer of security.

Data updated on October 10, 2023

Regulation is perhaps the most important criteria when trying to judge the trustworthiness and stability of a broker. We at BrokerChooser only review brokers that are overseen by at least one top-tier regulator.

TradeZero is regulated by the following financial authorities: SEC and FINRA in the US, CIRO in Canada.

You can also check whether a broker is listed on a stock exchange. To be able to go public, a broker must operate transparently, including regularly disclosing its financial information. Having completed the listing procedure is a sign that the broker is seriously committed and likely plans to be around for the long term.

Among online brokers, only a few are listed on a stock exchange, so the lack of a listing probably shouldn't be a red flag when you're shopping for a broker. Instead, just treat this as a bonus when trying to judge a broker's long-term trustworthiness.

Data updated on October 10, 2023

Do you want to zoom out and pick the best broker for long-term investment based on a full set of criteria including fees, trading platform experience and product selection? Look no further than our list of the best brokers for buy-and-hold investors.