Zecco Review

By Analyst: Robert Stammers, CFA
December 22, 2008

(broker review) - Zecco started what it thought would be revolutionary way to provide brokerage services: for free. Unfortunately maintaining the brokerage business off ancillary income has proven too costly and the company has reverted back to charging directly for brokerage services. Initially Zecco wanted to create revenue through its social network. In addition to account fees other advertising and income from such things as interest on margin was supposed to cover brokerage costs. Unfortunately the forums and blogs never attracted enough participants to create enough advertising or other revenue to cover trading costs. Zecco had a lofty goal to provide commissioners trades but found out that traders are interested in other things than just costs.

Zecco has two things that hinder it from becoming a competitive online broker. First, its platform is difficult to use and navigate. It is cluttered with advertisements and other calls to action. Dependability is also an issue. Traders want transaction delivery when it is needed most. Zecco has a history of lock outs, breakdowns, crashes, and other service problems that keep it from being considered an acceptable substitute for some of the reputable low cost providers.

Zecco's customer service is bad if you can find it. Finding the appropriate contact information or the extremely long waits for service puts Zecco in the very lowest category for service or market information. They do provide forums and blogs by experienced traders that may or may not be able to answer your particular trading or service problem. Zecco does have an email support system but has a reputation for taking a long time to reply.

Zecco does not provide any useful or valuable market research or trading tools. Remember this as no-frills as you can get. The service was supposed to be free but now is not. In order to keep fees where they are with a relatively low customer base this brokerage firm cannot provide a lot in the way of services or research. The current fees schedule that you can expect at this firm is 10 free trades per month and then $4.50 per trade after that.

If you are looking for a no frills low cost provider that also allows you to be involved in a social experiment, Zecco is your place. However for a few more cents a trade you can also get an appropriate amount of service and tools that are worth the extra costs.

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