In the complex landscape of investment management, various firms have sought to distinguish themselves through unique investment strategies, unparalleled customer service, and innovative financial products. Among these institutions, T. Rowe Price Broker has a significant role in the financial world. This article will delve into the T. Rowe Price review, providing features, benefits, order types, and usability. Moreover, it is helpful for deciding whether it is suitable for traders.
List of Contents
Overview: T. Rowe Price
Account Minimum: $100–$2,500
Fees: $9.95 per trade (for accounts with a balance of $250,000), $25 per trade for smaller accounts.
T. Rowe Price Broker stands out as a mutual fund corporation, with its core emphasis revolving around its funds and the clientele they cater to. Even though it offers the option for individuals to initiate a brokerage account to transact in single securities, it presents certain constraints. Specifically, its capabilities in aspects such as placing orders and accessing tools such as graphical representations could be more extensive compared to those of other digital brokers.
However, it’s essential to consider that T. Rowe Price does cater to long-term investors by offering them access to proficient and adept financial experts. These professionals can guide them in mapping out their financial trajectories effectively.
Customer Service
- Phone support is available from 8 a.m. – 8 p.m. on Monday – Friday.
- Expert trade placement is provided along with a commission fee.
- They offer an online help center to help customers who have problems accessing their accounts or have questions about trading.
- Live chat is unavailable.
Products
T. Rowe Price is recognized for its diversified range of product offerings, catering to a wide investor base. At its core, T. Rowe Price’s products include its own mutual funds and ETFs, which stand proudly as no-load funds.
For clarity, investors with T. Rowe Price have access to the following trading options:
- Mutual funds
- ETFs (Exchange-Traded Funds)
- OTCBB (Over-The-Counter Bulletin Board)
- Long and short stocks
- Listed option
- Fixed income assets (including U.S. Treasury bonds, Corporate debt, Municipal bonds, and U.S. agency debt)
Pricing
T. Rowe Price’s brokerage services, though extensive, come with a cost structure that is comparatively higher than many other online brokers.
| Products | Pricing |
|---|---|
| Stocks & ETFs | It is commission-free. Accounts with a balance of $250,000 must pay $9.95 per trade, while other accounts pay $25. |
| Options | While the minimum commission is $35, a Tele-trader is charged less than 10% of the standard Telecharge. Accounts with minimum balances of $250,000 must pay $9.95 + $1 per contract, while accounts with smaller balances are charged $19.95 + $1 per contract. |
| Mutual Funds | Mutual funds for non-T. Rowe Price funds are charged $35 for transaction fee funds, but it is not charged for non-transaction fee funds. In addition, fees for short-term trading are charged at a higher rate than $50–$250, exclusive of any redemption fees charged by the fund. |
| Bonds & CDs | Treasury Auctions and Bills are charged $50. Agencies (e.g., FNMA, FHLMC) and Various Treasuries are charged $1 per $1,000 bond. GNMAs and CMOs charged $1 per $1,000 bond, with a $25,000 minimum. Corporate bonds are charged $5 per $1,000 bond Municipal bonds are charged $5 per $1,000 bond The CDs’ minimum purchase price varies depending on the issue. It starts at $1,000. |
| Other Fees | Accounts with a minimum balance of $50,000 or higher must pay $30 for the account maintenance fee. While the margin rate varies based on account size relative to the PBLR, an account under $10K would be charged 1.75%, which is higher than an account over $50K, according to the PBLR. |
Order Types
The platform encompasses basic order types such as market, limit, stop, and stop limit orders. This includes specific variations like limit fill or kill and limit all or none. It’s worth noting that the website and mobile application don’t have the capability to combine multiple order types to establish contingent orders. This means you cannot incorporate stops or profit-taking points during the initiation of a limit order.
Currently, T. Rowe Price does not provide the option for trailing stops. If one wishes to use this feature, it necessitates reaching out to telephone support. However, this service incurs an additional charge.
In addition, the scope for options orders for both trading interfaces is restricted to dual-leg options strategies only. When initiating a selling order, a dropdown list appears in the symbol field, which showcases the current holdings. An area of improvement is that this list does not automatically populate the number of shares one holds.
Usability
T. Rowe Price’s brokerage platform might be seen as less user-friendly in comparison to its competitors. The system operates on a two-tier structure. Initially, upon logging in, users are presented with a view of both mutual fund and brokerage account balances. Diving deeper, selecting the brokerage account reveals details about T. Rowe Price’s collaboration with Pershing, their clearing firm. However, this bifurcated system, combined with variances in stock and mutual fund evaluations and settlements, can lead to momentary discrepancies in balance and asset distribution data. For instance, during our evaluation, there was a delay in the mutual fund balance page aligning with real-time data from the brokerage page.
Furthermore, The platform’s design seems to lag behind the modern, user-centric designs many online brokers are adopting. The inconsistencies between the login screen and the brokerage platform become evident in the menus. A case in point: customizable watch lists are buried under the ‘tools’ menu, making them less accessible for users who might expect to see them prominently displayed across platforms.
For mobile and desktop users, T. Rowe Price provides both a web-based and mobile platform, but a separate desktop workstation is notably absent. While the web functionality meets basic requirements, it feels technologically behind the times with a dated design. Another quirk is that the website launches the brokerage account in a separate browser window, permitting easy toggling between the primary login and brokerage windows. On the brighter side, the mutual fund segment lets users launch different functionalities in separate tabs. However, the brokerage side sometimes forces users to move away from the main page rather than allowing a new tab. This becomes inconvenient, especially if one prefers multitasking, like viewing current orders while researching stocks on another tab.
Trade Experience
The trading experience at T. Rowe Price is adequate for simple transactions. However, it lacks comprehensive features. Notably, the platform doesn’t allow traders to input contingent commands for actions like stop-losses, taking profits, or implementing trailing stops. If you don’t own security in a cash account, it’s impossible to place a sell-stop order. This means a trader must first execute a buy order before setting up a stop-loss order for that particular position. Such capabilities are commonly found on alternative trading platforms.
T. Rowe Price’s system falls short in allowing traders to set up orders based on criteria beyond just price, like limit orders. For instance, there’s no provision to place orders based on factors like volume shifts, percentage fluctuations, and similar parameters. Although it’s possible to initiate an order from a chart view, this action only brings up an order form with the relevant stock symbol.
When it comes to options trading, T. Rowe Price’s platforms are restrictive. They don’t support the entry of options that involve more than two components. Furthermore, advanced analytical tools vital for evaluating various strategies are conspicuously missing. This makes the platform unsuitable for potential options traders, even though it offers basic trading capabilities.
Mobile Trade Experience
The mobile platform requires traders to first execute a buy order before they can set a stop loss, which is similar to the website. Furthermore, the mobile app does not offer support for multi-leg option strategies. The absence of advanced analytics tools for options trading is another drawback. Moreover, the app doesn’t allow for seamless integration between charts and orders. This means traders can’t view their orders in conjunction with relevant charts. Additionally, there’s no capability to route or direct your orders to specific venues or paths.
While the T. Rowe Price mobile app serves basic trading needs, it may not be the ideal choice for more advanced traders or those seeking comprehensive options trading features.
Account and Research Amenities
While T. Rowe Price offers various amenities to its users, its suite of tools and services isn’t particularly noteworthy. However, when one opens an account, they gain access to the high-quality research that T. Rowe Price is known for.
Stock Screener
The stock screener presented by T. Rowe Price is user-friendly, complete with several predefined screens and an advanced option for those who prefer crafting a custom search. Predefined searches feature categories like value, growth, and high dividend yield, to name a few. Despite its simplicity compared to other brokers, the screener performs effectively.
ETF and Mutual Fund Screeners
These screeners function similarly to the stock screener, tailored to their respective security types. They possess specific predefined screens, and the advanced functionality parallels that of the stock screener. Notably, T. Rowe Price mutual fund enthusiasts have access to enhanced tools and functionalities, especially when considering risk profiles and portfolio building.
Fixed Income Screeners
Accessible through a pop-up, this screener provides a primary search with an option for advanced searches. Users get insights from the weekly economic calendar, daily market reports, and yield curve graphs. The screener provides comprehensive market information, including news and tax bracket insights.
Charting
Charting on both the platform’s website and mobile application is relatively weak. Despite having an order button directly on the charts, they need more detailed features, offering drawing tools and intricate studies.
Tools and Calculators
While the brokerage side has limited tools, the mutual fund side is more equipped. T. Rowe Price offers tools like a risk profile questionnaire, alongside calculators catering to life-planning events such as retirement.
Trading Idea Generator
There’s a conspicuous absence of a trading idea generator at T. Rowe Price. They do, however, offer robo-investing for mutual funds.
News
T. Rowe Price’s research area boasts functional news and market information. Users have access to news from various sources. The website offers more detailed features than the mobile app, including filtering and specific event sections.
Third-Party Research
Clients benefit from T. Rowe Price’s proprietary research. The range includes daily fund prices, market reviews, and newsletters. Premium account holders enjoy added benefits, like complimentary access to Morningstar memberships and reputable publications.
Fractional Dividend Reinvestment Program (DRIP)
A dividend reinvestment program is available, allowing fractional share purchases corresponding to dividend amounts.
Cash Management
T. Rowe Price offers an automated cash management system for brokerage accounts. Funds are conveniently swept in and out of selected money market mutual funds. This feature distinguishes T. Rowe Price from many brokerage companies that don’t offer interest on cash balances.
Transparency
T. Rowe Price clearly outlines its commissions, fees, and minimum requirements in a dedicated fee schedule on its website. However, while the increase over the Pershing Base Lending Rate by T. Rowe Price is mentioned, the actual base lending rate itself wasn’t provided on the site.
Although T. Rowe Price offers commission-free trading, it’s noteworthy that they do not explicitly mention that this advantage, at least in part, comes from the payment for order flow. Instead, they indicate that the order execution is handled by Pershing.
While exploring T. Rowe Price’s offerings, it was observed that there wasn’t a comprehensive breakdown or visual representation discussing the potential risks associated with margin trading. Moreover, a margin disclosure statement is available for those actively searching the website.
Available Account Types
T. Rowe Price provides an extensive array of account types, with a particular emphasis on retirement accounts. The account types they offer include:
- Trust Accounts
- Estate Accounts
- Individual and Joint Taxable Accounts
- SIMPLE IRAs
- Traditional IRAs
- Roth IRAs
- Custodial Accounts
- Simplified Employee Pension (SEP) IRAs
- Individual and Small Business 401(k) Plans
- 403(b) Plans
- 529 College Savings Plans
Education
T. Rowe Price provides foundational knowledge on its brokerage platform, covering investing basics, the significance of asset allocation, and a useful glossary of investment-related terms. However, it lacks comprehensive educational tools for deeper insights and learning.
Pros & Cons
Pros
- Offer expert financial guidance.
- Provide quality research and analysis.
- Available to connect with an outside account.
- Automated money transfer account.
Cons
- Require above-average expenses.
- Offer inadequate training tools.
- Provide a complex account initialization.
- Lack of diverse trading options such as Forex, Cryptocurrency, or futures.
Pros Clarified
- T. Rowe Price offers its clients specialized advice and strategic planning, empowering them to effectively handle their long-term financial goals. This guidance proves invaluable when preparing for pivotal life milestones, like financing education, purchasing property, or stepping into retirement.
- Clients have the benefit of receiving comprehensive research and analysis, courtesy of T. Rowe Price’s dedicated research team. This team not only serves the customers but also provides extensive insights for the firm’s mutual fund managers.
- With T. Rowe Price, clients have the privilege of connecting their external accounts, enabling a synchronized balance overview. This ensures that at any moment, clients can gauge the entirety of their financial well-being.
- T. Rowe Price introduces a unique automatic cash sweep mechanism. Here, surplus investor funds are effortlessly channeled into a selection of money market funds, from which clients can opt.
Cons Clarified
- In the realm of online brokerages, T. Rowe Price stands out with higher trading expenses, margin rates, and account prerequisites. These costs and thresholds are notably higher than what’s typically seen with its peers in the industry.
- T. Rowe Price’s online and mobile trading functionalities are notably basic. When it comes to aspects like order entry, managing positions, and charting, their offerings have limitations compared to many contemporary online brokers tailored for active traders.
- The procedure to open an individual account with T. Rowe Price proved tedious for many. It often necessitated numerous phone interactions and unexpected fax transmissions, taking longer than one would anticipate.
- Unlike many online brokers, T. Rowe Price has a restricted product range. They don’t facilitate trading in futures, foreign currencies, or cryptocurrencies.
Is T. Rowe Price A Worth Broker to Get?
T. Rowe Price boasts a commendable mutual fund platform that seamlessly integrates with a more generic online brokerage. Customers using the mutual fund platform are endowed with various valuable financial planning tools. Additionally, they benefit from the market research insights provided by T. Rowe Price.
Although the aforementioned research is a decent perk, it probably won’t be the defining factor in swaying dedicated brokerage customers to opt for T. Rowe Price over other established online brokers. The brokerage platform at T. Rowe Price is limited. However, T. Rowe Price’s fee structure and account minimums lean towards the pricier side when pitted against many of its competitors.
Conclusion
T. Rowe Price positions itself as a distinct mutual fund corporation with a foundational emphasis on its funds and the clientele they serve. Their mutual fund platform is robust, integrating seamlessly with an online brokerage and offering valuable financial planning tools and extensive market research.
While T. Rowe Price offers a commendable mutual fund platform, its online brokerage platform may not be the most competitive in the market. The platform is potentially more suited for long-term investors seeking expert financial guidance rather than active traders looking for advanced trading tools and functionalities.
FAQs
T. Rowe Price is a global investment management firm established in 1937 by Thomas Rowe Price Jr. The firm is known for its mutual funds, though it offers a full spectrum of investment products and solutions.
Absolutely. With a range of products tailored for different investment horizons and amounts, there’s something for everyone. However, it is more suitable for long-term traders than active traders.
Some critiques include higher fees and an over-reliance on active management in an increasingly digital investment landscape.
Yes, the minimum investment varies depending on the type of account and fund selected. It usually starts at $100–$2,500.
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