Editorial Review

Lightspeed Review 2020: Pros, Cons and How It Compares

Lightspeed caters to professional or extremely active traders, and it shows in the broker's high balance requirement and monthly commission minimums.

Dayana YochimJanuary 2, 2020

Many or all of the products featured here are from our partners who compensate us. This may influence which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own.

Our Take

3.0

NerdWallet rating 

The bottom line: Lightspeed offers low-cost options and futures trades and professional trading platforms and tools. But the company's minimum monthly commission and high balance requirements aren't a good fit for anyone who isn't an active trader.

Lightspeed

Lightspeed

Fees

$4.50

per trade

Account Minimum

$10,000

Promotion

50% rebate

on first 3 months of commissions, up to $10,000 (for new Lightspeed Trader customers only)

Pros & Cons

Pros

  • Advanced trading platforms.

  • Low options trading costs.

  • Futures trading.

Cons

  • High commissions.

  • High minimum investment requirement.

  • Excessive account fees.

Compare to Similar Brokers

TD Ameritrade
Interactive Brokers IBKR Lite
Zacks Trade
Fees

$0

per trade

Fees

$0

per trade

Fees

$0.01

per share

Account Minimum

$0

Account Minimum

$0

Account Minimum

$2,500

Promotion

None

no promotion at this time

Promotion

None

No promotion available at this time

Promotion

None

no promotion at this time

Full Review

Lightspeed, a division of Lime Brokerage, aims to fill the needs of a very specific kind of investor: a very active, high-volume trader. The ideal client? A professional trader.

That’s not to say amateurs can’t use Lightspeed — but to derive the most value, it helps if you make more than 250 stock trades or purchase 500-plus options contracts a month. Those who aren’t quite in that league may be better served by more mainstream brokers like TD Ameritrade, Interactive Brokers or TradeStation. All of those offer free trades, sophisticated trading tools plus much more education and research for the nonprofessional stock trader.

Lightspeed is best for:

  • Advanced traders.

  • Day traders.

  • Options traders.

  • Futures traders.

Lightspeed at a glance

Account minimum

$10,000 for Web Trader platform ($2,000 for IRAs). All other platforms (Lightspeed Trader, RealTick, Sterling Trader): $25,000 ($10,000 for IRAs). Margin account: $175,000.

Stock trading costs

Lightspeed Trader: $4.50/trade or $0.0045 per share ($1 minimum).

Volume discount as low as $2.50 per trade or $0.0010 per share.

Options trades

No base commission; $0.60 per contract ($1 minimum).

Volume discount as low as $0.20 per contract.

Account fees (annual, transfer, closing, inactivity)

$25 minimum monthly commission fee for accounts under $15,000.

$20 IRA opening fee; $35 IRA annual fee (first year waived); $95 IRA closing fee.

Commission-free ETFs

None.

No-transaction-fee mutual funds

None.

Tradable securities

• Stocks. • ETFs. • Options. • Futures.

Trading platform

Lightspeed Trader (desktop) for active traders, hedge funds and institutions. $130 monthly platform fee (reduced by commissions generated).

Lightspeed Web/Mobile Trader for occasional day traders. $0 platform fee; market/data feeds free for nonprofessional traders.

Futures trading on Eze EMS platform.

Mobile app

Available for iOS and Android; features basic functionality of the Lightspeed Web/Mobile Trader platform and after-hours trading.

Research and data

Real-time streaming data, recorded active trading webinars, free practice/demo paper trading account.

Customer support options (includes website transparency)

Phone and email support 8 a.m. - 5 p.m. Eastern.

Promotion

New Lightspeed Trader, Sterling or Eze EMS (formerly RealTick) accounts: 50% rebate of stock and options commissions for the first three months (up to $10,000).

Where Lightspeed shines

Trading platforms: Lightspeed has multiple trading platforms, with several that cater almost exclusively to hedge funds and institutions. Two — Lightspeed Web/Mobile Trader and the desktop-based Lightspeed Trader — are best suited for nonprofessional individual investors.

Non-pro stock and options traders pay no monthly market or data fees on Lightspeed Web/Mobile Trader. The platform comes with real-time Level 1 streaming data for stocks and options, historical charts, watch lists, and TipRanks analyst research.

For more active traders, the desktop-based Lightspeed Trader platform allows for expedited order entry and execution. You'll pay a $130 monthly platform fee for access, but the fee is reduced by any commissions generated.

Lightspeed Trader offers direct-market access. Orders are sent straight to one of 100 routed destinations, skipping the typical pit stop at an intermediary brokerage firm. This speeds up order fulfillment by seconds (even nanoseconds), which matters to day traders. Note that customers using these platforms will pay routing fees (e.g., $0.0013 to $0.0031 for NYSE orders) on top of the trading commission. Also included are real-time streaming Level 2 data (more robust than Level 1), TipRanks and Lightscan stock screening.

For those interested in test-driving the Lightspeed Trader platform, we recommend opening a free demo/paper trading account.

Options trading costs: Lightspeed charges no base commission for options trades, and the contract fee is just $0.60 per contract for those trading fewer than 500 contracts a month. There's a $1 minimum, but even so, the cost is competitive.

It gets even more so for active traders who benefit from the broker's volume discounts: The per-contract fee drops to as little as $0.20 for high-rollers trading more than 100,000 contracts per month.

Futures trading: Lightspeed is one of a handful of brokers NerdWallet rates that offers futures trading. Lightspeed's going rate is $1.29 per side, and it has multiple platforms to serve futures traders. Eze EMS (formerly RealTick) is a desktop platform for active futures, stock and options traders. The monthly platform fee ranges from $125 to $325. The web or desktop platform CQG ($35 monthly fee for mobile and $70 for desktop) focuses solely on futures trading.

Where Lightspeed falls short

Commissions: Lightspeed’s commissions used to be a high point; they're now a low. As more and more brokers have moved to $0 commissions for stocks, options and ETFs, Lightspeed no longer stands out here for anything but options.

The company's standard commission for stocks and ETFs is $4.50 per trade. Lightspeed’s volume discounts help a bit: The price drops to $4 a trade for investors who make between 250 and 750 trades a month and a low of $2.50 if you make more than 10,000 trades a month. Per-share prices start at $0.0045 per share ($1 minimum trade commission) if you trade fewer than 249,999 shares per month and decline from there.

Minimum investment requirement: As we’ve been saying, Lightspeed’s target audience is professionals or, if not a professional, at least a seriously active or high-volume trader. Still, the broker’s minimum investment requirements are higher than some competitors, including Interactive Brokers and TradeStation.

At $10,000, Lightspeed Web/Mobile Trader has the lowest initial and ongoing account minimum requirement among the company’s offerings. (Retirement accounts on this platform require a $2,000 minimum.)

The minimums are higher — $25,000 for a regular brokerage and $10,000 for a retirement account — for the more robust Lightspeed Trader platform, as well as the other services aimed at super-serious investors: Eze EMS (formerly RealTick), Sterling Trader and LivevolX.

Account fees: Fees really hurt Lightspeed in our scoring rubric. Customers with account balances of less than $15,000 are charged a $25 monthly minimum commission fee, minus any actual commissions they paid during the previous month. There are also fees on retirement accounts: a $20 IRA opening fee, $95 closing fee and $35 annual fee (waived for the first year).

Investment selection: While Lightspeed gets recognized as one of the few brokers we review that offers futures trading, there is a gaping hole in its offerings for average investors: It has no commission-free ETFs and offers zero mutual funds. That’s not surprising for a trader-focused broker, but it is a gap worth considering if these are on your list of must-haves.

The bottom line

Lightspeed is designed primarily for institutions, hedge fund managers and extremely active, high-volume day traders. Things that hurt the broker in NerdWallet’s rating system — high trading requirements, lack of no-transaction-fee ETFs, no portfolio-building guidance and few educational tools — don’t matter much to Lightspeed’s target clientele. But they are significant shortcomings for everyday investors shopping for a broker.

If you’re still interested, Lightspeed welcomes potential customers to request a demo account. Otherwise, active nonprofessional traders should check out TradeStation and Interactive Brokers; both offer $0 commissions and professional-grade trading tools that are a better fit for amateurs.