| 01 July 2010

E*TRADE Financial Corporation (ETFCD) announced today the launch of an open API, or Application Program Interface. By launching the new XML-based API E*TRADE joins the ranks of optionsXpress (OXPS) and Interactive Brokers (IBKR) who have long offered programming interfaces that give programmers direct access to their trading platforms.

The availability of an API is typically good news for the more hyper-active or professional trader, who uses software products to create program, or automated, trades and would like those products to link directly to their broker of choice to execute on those trades. A great example of this is thinkorswim's ThinkPipes product which helps support basket trading, among other things, for institutional investors.

Of course, what these hyperactive traders require is a more reasonable commission structure suited to their active trading styles. Interactive Brokers charges $0.0035 per share traded or $0.70 per contract for lower volume levels, with minimums of $1.00 per order. E*TRADE, by comparison, charges $7.99 per trade and $7.99 plus $0.79 per options contract (as long as you're making at least 150 trades per quarter). The company has not suggested a change in commission structure for hyper-active traders beyond what is already offered.

E*TRADE announced that they have already partnered with CoolTrade and AbleTrend. Both firms will enable the E*TRADE API in their products. CoolTrend is live and AbleTrend is scheduled to go live soon. CoolTrade already interfaces with InteractiveBrokers, TD Ameritrade and MB Trading. AbleTrend interfaces with MB Trading and TD Ameritrade.