October 7, 2018

Lightspeed Trading Review: Is It Good?


Day traders need a fast-acting platform with low costs. Lightspeed Trading promises just that. But do they deliver? Read on to decide if Lightspeed is the best discount broker for you.

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Lightspeed Trading keeps things simple. You won't find a large number of features. Instead, you'll get:

  • Instant order execution
  • Software to handle your speedy orders
  • Competitive fees

That's not to say Lightspeed doesn't offer some tools, because they do. They cater to the frequent trader, though, not the occasional, low volume kind.

If you are a day trader or someone interested in day trading, keep reading to see what Lightspeed offers.

How Does Lightspeed Trading Work?

Lightspeed can be categorized as a "discount broker." Their fees are lower than a full-service broker's fees. But the platform puts you in charge of your investments. You won't have a financial professional handling them for you.

It offers services to institutional and retail investors. If you are an individual, you are a retail investor. That means you have some powerful investment tools at your disposal.

Investors can trade stocks, options, and futures, but only on certain platforms. Lightspeed doesn't offer bonds, options, or mutual fund investments.

What's the Minimum Deposit Required? Lightspeed requires a minimum $25,000 initial deposit for both the LS Trader platform and the Web/Mobile platform.

The only exception is for those investors not participating in day trading on the Web/Mobile platform. Occasional investors can make a $10,000 minimum investment to get started.

There are five platforms, but only two are for retail investor use: The LS Trader and Web/Mobile Trader.

The LS Trader is Lightspeed's flagship offering. It's reserved for the active investor, aka day trader.

The Web/Mobile platform works for the occasional investor.

How's the Platform?

Lightspeed Trader was created with day traders in mind. It provides:

  • Real-time quotes
  • Fast order execution
  • A wide variety of trading tools.

As a day trader, you can customize your dashboard to meet your needs. Whether you prefer to set up "hot keys" for fast order execution or you would rather point and click, you can set your settings to meet your preferences.

You Should Know The LS Trader can process complex options trades. It offers a variety of scanners and filters to help you make the platform suit your needs.

How's the Mobile App?

The Lightspeed Web/Mobile platform operates only online. Investors get a sophisticated system they can use on the go WITHOUT paying a monthly software fee.

The Web/Mobile platform offers real-time streaming quotes and makes order entry simple. You can even access advanced market data in this platform right from your phone.

The mobile app allows you to access your portfolio, make trades, enter advanced orders, and view charts, all in real-time.

Download Link for Lightspeed Trading: Lightspeed gives you the chance to try their LS Trader program free of charge.

First, you must provide your first name, last name, and email address. You can then download the program. Lightspeed will provide you with login information via email, so make sure you watch for it.

You can then conduct "mock trades" in the demo based on real-time past information. You'll also have the opportunity to review training videos and reference guides to help you get started.

What Are the Fees?

Lightspeed offers two pricing options: per share or per trade.

They work on a tiered system, which benefits the active traders because the more you trade, the more you save. For example, if you make less than 250 trades per month, you'll pay $4.50 per trade.

The cost goes down from there as follows:

  • 250 - 749 monthly trades: $4.00
  • 750 - 1499 monthly trades: $3.50
  • 1500 - 2999 monthly trades: $3.00
  • 3000 - 9,999 monthly trades: $2.75
  • More than 10,000 monthly trades: $2.50

Lightspeed also offers a per share commission structure, as follows:

  • Less than 249,999 shares: $.0045 per share
  • 250,000 - 999,999 shares: $0.0035 per share
  • 1,000,000 - 2,999,999 shares: $.0020 per share
  • 3,000,000 - 5,999,999 shares: $.0015 per share
  • Over 15,000,000 shares: $0.0010 per share

Lightspeed Trader API: The Lightspeed Trader program has an Application Programming Interface that allows traders to create their own algorithmic strategies. You'll need to know C++ programming in order to utilize this function and access Lightspeed Trader's functions.

Reasons We Like Lightspeed Trading

  • Lightspeed's trades are low-latency.
    Low-latency translates to "fast." The technology used by Lightspeed allows for "lightning quick" trades, helping you to maximize your chances of a profitable trade.

  • Lightspeed Trading offers a variety of educational tools.
    You can choose from webinars, tutorials, the Active Trading blog, or FAQs to get the answers you need about the platforms and processes.

  • You can set up "hot keys" to quickly execute orders.
    Day traders often use "hot keys" that they define themselves. Once programmed, these one-touch buttons can execute certain orders.

  • Lightspeed Trader can handle complex options trades.
    Options traders using complicated strategies often find themselves reaching the capacity of a broker's software. Lightspeed Trader, however, can handle complex orders with ease.

  • Amateur traders have access to free market and research data.
    Non-professional traders can have free access to the market data package provided by Lightspeed Trading.

    VALUE: Lightspeed's free market data and research package costs professional traders $105 per month. Active day traders have access to the information free of charge.

  • Customer service has licensed financial pros.
    Each representative who works for Lightspeed is a licensed financial professional. They are available for your questions via phone and internet during business and non-business hours.

  • Only one account for multiple types of trades.
    You can trade stocks, options, or futures all from one account. This helps keep things less complicated when keeping track of your investments.

  • High-volume trader get rewarded for volume. The price you pay per trade and/or share goes down as you climb the pricing tier. Investors need to trade just 250 shares per month to start enjoying the discount.

Reasons To Look Elsewhere

  • You need at least $10,000 to start.
    If you are a new investor or you don't have a lot of capital, you may not be a good candidate for Lightspeed Trading.

  • You are a small or infrequent investor.
    The pricing structure and complex platform reinforce means Lightspeed is best suited for the active or professional investor. If you only invest occasionally or are just getting started, you'll want to look for a more user-friendly platform.

  • Lightspeed doesn't offer retirement tools. While you can open a retirement account (IRA) with Lightspeed, they don't offer any type of retirement calculators to help with "what if" scenarios or retirement estimates.

How It Compares

  • Interactive Brokers: Interactive Brokers is another viable choice for day traders.

    Users can create "hot keys," have access to limited educational opportunities, and pay competitive fees. Clients of IB often feel as if they are on their own, though, as the customer service leaves a bit to be desired.

    If you aren't comfortable with the platform or need frequent customer service, you may want to look elsewhere.

  • TD Ameritrade: TD Ameritrade has two sophisticated platforms, but the commissions are higher than Lightspeed's fees.

    TD Ameritrade offers mutual funds, whereas Lightspeed doesn't. This includes almost 300 commission-free ETFs, which Lightspeed doesn't offer.

Bottom Line

Lightspeed's pricing structure and lightning-quick trades may be ideal for day or very active trader with at least 250 shares traded per month. But passive investors may want to look elsewhere.

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