Lightspeed Trading Review
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Lightspeed - Reviews & Ratings
• Account Minimum: $10,000
• Fees: Charges for nearly everything
• Best For: Active traders
• Highlight: Discounted stocks based on trading volume
Investor Warning: Carefully consider the investment objectives, risks, charges and expenses of any investment company before investing.
If you deal high volumes and trade options, then you’ll love Lightspeed. The platform was built for active traders who trade a lot (“at the speed of light”). While the cost of trading is low, you’ll need to maintain a higher account minimum than other brokerages.
There are a ton of ways to trade using Lightspeed, such as mapping hotkeys to send your orders to the market faster. Their main platform is Lightspeed Trader, a desktop app that can be configured so your tools always start on top.
However, if you trade in options, investors need to use a separate platform called Livevol X, which has more evaluation and spread options.
Note: In this review of Lightspeed, I only looked at their popular desktop trading platform – Lightspeed Trader. You can execute all of your orders through this platform, and while it does not have the most streamlined experience, you can customize it to execute your trades fast. You can set up infinite hotkey options for fast trades.
In addition, Lightspeed offers Time in Force options that let you pick from all kinds of spreads. There are several ways to place orders, so you can craft a custom order and duplicate it. You can set up default orders as well. There are no automated trades, however.
Overview and Summary
- If you are a high-velocity trader who cuts commissions by operating at high trade volumes, then you’ll love Lightspeed. It’s designed to help day traders save money when they make over 250,000 trades per month.
- Advanced charting, automated trades, and mobile apps are all available with Lightspeed, but you’ll pay extra for certain functionality. For example, automated trades are only available for the Lightspeed Gateway add-on, which costs $325 per month.
- Lightspeed’s name comes from the extremely fast trade executions. Nothing else but the best for active day traders, right?
- You can monitor stocks and get suggestions in real-time using Lightspeed Trader, which makes it the best platform if you are constantly looking for trending equities, ETFs, options, and futures.
- This is not a platform for retirement planning and long-term investing, and you won’t find any mutual funds or fixed income trading on this platform.
How Does Lightspeed Work
Once you sign up for an account online, you can download the desktop app Lightspeed Trader. You can customize the desktop so that it shows you news, research, and tools that you use the most at the top.
In addition, you can also pick the venues that you want to use for each stock or option trade. You can route the orders through 20 different venues, including dark pools if you wish.
Lightspeed is the simplest order router, which has its own algorithm that helps you execute trades on the best exchange and route as chosen by the AI. This means that you always get a fast, trusted execution.
In addition, Lime Trading Gateway provides users the ability to get an order entry in under a second. There are also more choices on how to trade within this platform tool.
If you are an options trader, then you’ll use Livevol X. This tool is meant to have the most spreads and trade options. It is more visually engaging on the desktop platform, but you can also use the web version if you want faster, simpler order options.
The Lightspeed Experience
For active traders, Lightspeed was built to make your life easier and offers the most popular tools within a simplified desktop interface and mobile app platform. It was designed to also be the fastest platform, which is why it’s considered a low-latency brokerage.
Lightspeed has a sophisticated algorithm that offers low-latency trading, which could mean higher profitability due to quicker executions. This is a great advantage for any day trader or high-velocity trader, but it comes with a trade-off.
While Lightspeed is a discount broker, you must maintain a higher account balance. This should not be a problem for an active day trader, but it could present issues for beginner traders who do not have a $10,000 account minimum to spare. Still, if you like customizable charting and analysis tools, you’ll find the best ones here.
You can trade in all equities, options, and futures with Lightspeed. However, the browser and web apps do not allow for futures trading. You won’t fund mutual funds and bonds.
- Through Lightspeed Trader, their desktop platform, you can customize your own orders and even access automated trading tools for your orders, but it comes with a monthly cost of $130. This is waived if you pay more than $130 in commission fees per month.
- The low-latency platform was designed for fast, trusted executions
- Customer service is prompt during regular business hours
- Advanced charting and real-time streaming quotes offer the best suggestions for high velocity day traders
- Not a platform for beginner or casual investors
- Fees are charged for everything, which is why only high velocity traders and institutions typically use Lightspeed
- There are fees for all partner and third-party services, such as $325 fee to use Sterling or the $230 to $260 fee to add Eze EMS/RealTick to your Lightspeed Trader platform
- You’ll pay $325 a month to use automated trading features through Lightspeed Gateway
- $25,000 account minimum is required to use Lightspeed Trader
What Can You Trade with Lightspeed
You can trade trade the following:
- ETFs (not commission-free)
You will not find support for long-term investing on this platform, which means no mutual funds or fixed-income trading. In addition, there aren’t any forex trades or cryptocurrency trades available on this platform.
Opening an Account
Lightspeed offers a completely digital way to sign up for individual, joint, options, and futures accounts. However, you have to complete a few questions to determine if you are a professional or non-professional trader, which takes some time. The verification process was complete in 24 hours including funding.
Analysis, Charting, and Research Tools
With real-time streaming quotes, customizable charts, and live market scanner tools, investors will find all kinds of trading opportunities. Charts have access to 20 years of historical data through the platform.
Lightspeed is definitely a platform for experienced day traders, and there isn’t much for research beyond testing strategies and historical charts. You do have access to TipRanks, which is included with your account.
However, beyond a stock scanner, real-time quotes, and TipRanks, you won’t find much else in market research.
When it comes to education and learning tools, Lightspeed offers some information on learning to trade stocks, options, and futures through “Active Trading Webinars” and the active trading basics area of the education center. You will find pages dedicated to most of the basics when it comes to trading strategies, but for more complex or trending strategies, you’ll need to look elsewhere.
Beginners can learn to use the interface through the Lightspeed Trader trading tutorials, and you can also have a demo prepared for you, though brokers also use this to sell you on the platform and higher account minimums.
Account and Investment Costs
Lightspeed’s pricing is based on volume, but unlike other brokerage firms, you will be charged a commission fee. The structures change based on per trade or per contract.
For those who choose per trade, you will pay $2.50 as long as you have over 10,000 trades per month. This rate goes up depending on the volume. For under 250 trades per month, traders pay $4.40 flat per trade for stock or ETF.
If you go with the per share rate, traders pay as low as $0.00010 per share if they have over 15,000,000 shares in monthly volume or as much as $0.0045 with under 249,900 shares per month. There is a $1 minimum with that last rate.
For options, traders pay $0.20 per contract but most have over 100,000 contracts per month. For those with less than 500 contracts per month, you’ll pay $0.60 per option contract.
Futures cost $1.29 per side. Futures options cost $1.79 per contract.
Lightspeed is designed to be most cost-conscious for the frequent trader, so the more you trade, the less you will pay. While the platform claims to have the lowest trading fees on equities and options, it’s still not as low as Firstrade.
There are also some hidden charges to note with Lightspeed. For example, on Lightspeed Trader and its partner Sterling Trader, you will be charged a minimum commission charge to any order less than 100 shares. This fee is equal to the per-share rate times 100.
Lightspeed web and mobile app users also must pay a minimum commission of $4.50 on any options order. Per-share equity fees are not available for Lightspeed browser trading or mobile app.
There are also funding minimums for new accounts as follows:
- $25,000 for Lightspeed Trader, Eze EMS, or Sterling Trader
- $10,000 for browser-based platform
- $175,000 for margin traders
You can fund accounts via check, ACH, or wire transfers.
Multiple Platforms and Partners
Depending on what you’re looking for in a high-velocity trading platform, Lightspeed has every option except for automatic trading. You can use Lightspeed Trader as your desktop platform for day trading, hedge funds, and institutions.
However, Lightspeed charges $130 per month to use the desktop application. You can have this fee waived if you trade more and pay commissions over $130 per month, however.
You can also access trading tools on the web on Lightspeed’s website or their mobile app. There is a $0 application fee for these tools, as long as you are not a part of an institution. The mobile app is available on iOS and Android. While you can make trades and access charts, it’s less robust on mobile than through the web or even more feature-rich Lightspeed Trader desktop platform.
Futures trading is only available through their RealTick and CQG platform partners.
Lightspeed has one of the only platforms to offer futures and futures options trading. The current rate is $0.25 to $0.60 per contract for futures, which is based on trading volume. The more you trade, the less you pay applies here as well.
However, all futures trading is done through Lightspeed Trader in connection with Eze EMS aka RealTick or CQG. While Lightspeed tries to offer more for futures traders, you’ll be better served by using a full futures brokerage to access more tools. You’ll get only the basics through third party software on Lightspeed.
Additional Platform Fees
It may seem like Lightspeed is free, but it charges for a variety of extras that are typically included with larger brokerages like TD Ameritrade and E*Trade. For example, Lightspeed Gateway does allow you to automate trades based on your own algorithms in C++ or JAVA API and FIX, but you have to pay $325 per month to access this software.
You also have to pay $325 per month to access Eze EMS or RealTick.You can make a variety of customized order entries, allowing you to set up any type of trade, but it’s expensive when considering the per month charge.
Sterling Trader is also a separate charge between $230 and $260 per month, which includes advanced charting and order entry options to integrate with Lightspeed Trader.
Lightspeed has not suffered any data breaches recently. Your accounts are insured through SIPC for $500,000 as well.
Funding, Payments, and Withdrawals
You can fund your account through an ACH transfer for free through your bank. It’s simple to set up using Lightspeed’s funding tools.
Lightspeed makes it very easy to get your money. You can use the outgoing ACH transfer for free, and it only takes two business days to complete. The platform processes all withdrawal requests the same day if made by 2:30 PM EST. You can simply click “Transfer Funds” and add your bank to send your funds.
You can also use wire transfers, which have a $20 cost for domestic and $50 cost for international. Lightspeed will also mail you a check, which takes about 3 to 5 business days to receive.
Lightspeed offers support through a toll-free number and email. There are also physical locations available in New York and Chicago. Their customer service team is available during regular market hours Monday through Friday.
You will not find any live chat features, and most support questions are directed to email or their frequently asked questions, tutorials, and webinar pages.
Tricks to Using TradingBlocks Like a Pro
- Sign up for a TradingBlocks account to access robust charting and analysis tools on Sterling Trader Pro and SILEXX OEMS.
- Use Tradebuilder to test out strategies and aggregate new trading ideas based on profitability.
- Get advanced futures trading ideas and analysis through TradingBlock Futures, which also has a mobile app.
- You can sign up for training to get more information about the platform and how to use more complex tools.
Latest News About TradingBlock
There haven’t been any significant news stories about TradingBlock since 2018, and it doesn’t look like they have updated much on their own app. However, they still receive the latest information from updated third party services.
Tricks to Using Lightspeed Like a Pro
- New Lightspeed Trader, RealTick/Eze EMS, and Sterling accounts get a 50% rebate for stock and options commissions for the first three months up to 10,000.
- Set up your account online and test out web or mobile app features to see if it suits your needs. Lightspeed Trader is a level up that is designed for traders who have hundreds of thousands of trades per month, which is why it costs $130 per month.
- If you spend $130 in commission fees through trading on Lightspeed Trader, you won’t have to pay the subscription fee.
- There aren’t any commission-free trades on the platform, but there are volume discounts. This is why institutions and hedge funds use this platform the most because you can pay as little as $2.50 per trade if you have more than 10,000 trades per month.
- You also have to pay your own routing fees depending on the venue. You can see a list of Lightspeed routing fees here.
Latest News About Lightspeed
Lightspeed has been developing new tools for Mac OS customers. Previously, only Windows users were able to access Lightspeed Trader, but now active equity and option traders on Macs can access the Lightspeed Trader for Mac app.
What Rocks About Trading with Lightspeed
Lightspeed discounts stocks based on your trading volume, which is a good thing for active day traders. The per-share or per trade savings is best for those who trade hundreds of thousands of shares per month. Per-share discounts begin at $0.0045 per share for a $1 minimum trade commission, but that’s only if you do less than 250,000 shares per month.
Futures trading also offers discounts. You’ll pay between $0.25 and $0.60 per contract based on your volume.
As long as you are not a professional, you won’t pay any fees to use the browser-based or mobile app platform, but the more robust tools are available through Lightspeed Trader. This platform was built for fast trades.
Lightspeed describes its Lightspeed Trader app as a low-latency platform designed for fast, high-quality trade executions. This is true since you don’t have any intermediary brokerage helping with trade executions. Everything is done in seconds, which is very important for high-velocity day traders.
You can set up default orders, automated orders, and customized bulk orders if you opt to pay for the Lightspeed Gateway and Lightspeed Trader platforms, which is a combined total of over $350 per month.
What Lightspeed Could Do Better
Lightspeed really caters to active traders, so it’s no surprise that they require you to have a $10,000 minimum account balance. While Interactive Broker is another active trader favorite, that platform did away with account minimums in 2018. Lightspeed has fallen behind in this regard.
Minimums are also higher if you want to rade using the Lightspeed Trader platform. To trade on the desktop platform, you’ll need an account minimum of $25,000.
There are several fees that Lightspeed charges you to use their advanced tools and desktop applications. However, there are also fees for customers with less than $15,000 in trades per month. You will incur a $25 monthly minimum fee.
You also have to pay $130 monthly for the Lightspeed Trader platform. You’ll pay between $260 and $350 a month for other tools like Eze EME and Sterling Trader platform.
There are also no commission-free equities or ETFs, which has become standard for most of the other online brokers. While it’s not a big deal for active traders, and Lightspeed does offer futures when other brokers do not, if you were looking to save on commission fees and rates, Lightspeed is not the best platform for you.
Conclusion: Should You Invest with Lightspeed?
Lightspeed is probably best for experienced day traders, hedge funds, and institutions. Anyone who isn’t dealing with high volume day trades will find the pricing to be exorbitant and will not want to deal with the monthly subscription fees to use Lightspeed Trader and other tools.
While the advanced charting and automated trading tools are superb, they come at a higher cost. That said, professional day traders love the Lightspeed Trader platform because of its customization features and discounts for high volume trading. Much of these fees don’t matter if you are trading over six figures each month.