Our Take

As one of the only agency brokers on Wall Street, Lime Financial stands out in the industry as a broker that is only acting on behalf of their clients to execute client trades. In other words, Lime is not holding inventory in the securities that its clients buy and sell, like a broker-dealer would. Lime Financial’s platform uses algorithmic trading to react to market events faster than the competition, thereby increasing the profitability of trades—also known as low-latency trading. Lime Financial is primarily offering direct market access and platforms designed for day traders and anyone wanting to invest in the market using high-frequency trading (HFT).

Introduction

Lime Financial was founded in 2000 when a hedge fund was looking for a brokerage firm to meet their needs for volume, speed, and privacy. After gearing its services toward a competitive group of financial institutions, Lime is now expanding access to independent traders who value quality execution. Score Priority was a diverse financial technology, trading, and brokerage firm, offering a full suite of services for active retail, professional, and institutional clients, before acquiring the Lime low-latency execution platform from Lightspeed Financial Services in 2020. Lime was a natural fit to better serve high-frequency traders with hedge-fund-level technology and Score Priority chose to rebrand as Lime Financial after integrating those capabilities. We’ll take a closer look to help you decide if Lime Financial is the right investing platform for you.

Pros & Cons

Pros Explained 

• Unlimited $0 commission trading on U.S.-listed stocks and EFTs: Lime Financial offers low-latency trading technology to individual, high-frequency traders, starting with a base level account.
• Hedge fund-level technology: Lime Financial is unique in the industry, offering investors sophisticated features, such as charts, watch lists, screeners, portfolio tabs, option chains, and margin and short trading.
• Low-latency trading platform: A platform that uses algorithmic trading to react to market events faster than the competition, thereby increasing the profitability of trades.

Cons Explained 

• Not meant for entry-level investors: While all of the technology and platform features are top-notch, it would be overwhelming and confusing for novice investors.
• No proprietary or third-party research to investors: This is another indicator that users on this platform must be well-versed in how to invest and what they want to invest in, as all research and information must be found outside of this platform.

Usability

Lime Financial offers a straight-forward dashboard that gives users an overview of current market news, market sectors, and portfolio holdings. Investors are even able to set up their own list of favorite stocks to follow to further customize their user experience. Investors can log in from either desktop or mobile platforms to keep tabs on their account from anywhere. While there are several ways to customize the dashboard with regards to stocks, there is currently no choice to add screeners for ETFs, options, or fixed income.

Trade Experience

The trading dashboard has many options for the investor to customize, such as screeners, notifications, alerts, and favorites. Lime offers investors the ability to place traditional orders, trade options, and short stocks. Placing a market order, limit order, or conditional order is easy from the main trading dashboard. There is also a nice trade from chart feature and you can move the one-cancels-the-other (OCO) prices with your mouse.

For the more advanced investor, Lime offers convenient indicators, such as the HTB designation for stocks that are hard-to-borrow. If this is something that you are looking to do, Lime Financial has made its platform a one-stop shop by locating the stock and giving you a quote on it, so you won’t even need to leave the platform.

For high-frequency traders, speed of trading is important, and Lime highlights low-latency trading on its platform. Sterling Trader® Pro goes through the Lime framework. It’s faster, but has no options trading on it. Metatrader 5 is a powerful testing tool, but its third party downloadable web and mobile components have limited backtesting when used in the Lime platform.

Mobile Trade Experience

Switching from the account and portfolio dashboard to the trading screen is simple via a desktop computer, as a tab is at the top of the screen to make this transition easy. Just click “go to trading” at the top of your dashboard and you will be taken to the trading screen where you can then monitor the market, place an order, or open an option chain. No such tab appears on the mobile app. 

However, investors can go into their dashboard, click on a particular stock, then they will have the option to place a “new order” by clicking the green button at the bottom of the screen. Currently, there is only the capability to place a new market, limit, or condition order. No multi-leg options orders are available on the mobile platform at this time. However, investors can close the individual legs of multi-leg strategies on mobile.

Range of Offerings

At Lime Trading, you may trade in stocks, ETFs, options, and over-the-counter (OTC) stocks. Because Lime is an agency broker, they are not holding inventory in any of the securities that an investor buys or sells, thereby opening up the market to investors. However, there are some limits to what investors can access through Lime’s platform. Lime doesn’t support fractional shares trading, as well as forex, crypto, international stocks, or bonds. 

Investment products offered at Lime:

• Stocks–long or short sales (over 5,000 on an easy to borrow list)
• OTC stocks
• Exchange Traded Funds (EFTs)
• Single and multi-leg options (up to 4 legs)

Order Types

In addition to Lime’s market access and low-latency order execution, investors can also implement key benchmark strategies:

• Volume-weighted average price (VWAP): the average price of a security throughout the trading day, factoring in both price and volume
• Percentage of volume (POV): tracks and reacts to real-time market volumes to target a user-defined participation rate

While these high-level options are available, users still have the ability to enter traditional market, limit, or conditional orders, as well as option chains.

Trading Technology

Lime Financial offers several platforms for trading. Lime Financial’s goal is to provide low-latency trading technology for systematic traders. Lime’s focus is on high-throughput performance, secure hosting and colocation at major data centers, and customized algorithms and smart order routers. Lime offers the following platforms for trading:

Proprietary:

• ETNA
• Lime Trader

3rd Party Platforms:

• Lime Pro (only through WedBush at this time)
• Lime Meta

There are no additional fees for ETNA, Lime Trader, and Lime Meta, but Lime Pro is $200/month plus market data fees.

Before an order is eligible to be placed on the exchange for execution, the brokerage firm is responsible for a mandatory pre-trade risk check (Rule 15c3-5) to ensure that an order is not violating any predetermined thresholds. Lime’s pre-trade risk check is much faster than the competition, taking only single-digit microseconds to complete, as compared to other brokers, whose pre-trade risk check can take much longer and potentially cause missed order fills.

Lime’s algorithmic trading platform allows quantitative traders access to several markets, fast execution, customizable settings, and execution reporting.

Costs

Here’s a rundown of Lime Financial’s commissions and fees:

$0 Commission and Premium Plan:

• Unlimited $0 commission trading on U.S.-listed stocks and ETFs
• ECN/extended hours trading – commission surcharge of $0.003 per share
• Options: single-leg $0.50 per contract; multi-leg $0.50 per contract on each leg
• Broker assisted trades – ETF trades placed over the phone cost $20.00, Equity trades placed over the phone are $20.00 per trade, Option trades placed over the phone are $20.00 plus $0.50 per contract
• Direct market access pass-through fees vary based on industry volumes and is assessed to buy and sell option orders at a rate of $0.005 per share

Per-Trade Plan

• Stocks $2.50 per trade
• ETFs $2.50 per trade
• ADRs $2.50 per trade
• Exchange listed stocks under $1.00- $2.50 + $0.003 per share for entire order
• OTC Securities $2.50 + $0.003 per share for entire order
• Options $2.50 + $0.50 per contract
• Spreads(per leg) $2.50 + $0.50 per contract
• Straddle (per leg) $2.50 + $0.50 per contract
• International Stocks $2.50 + $75 Foreign Stock Transaction Fee
• Broker-assisted Trades $20.00 Including applicable commission

Sterling Trader® Pro

• $230 per month platform fee

MetaTrader 5 (Automated trading)

• Unlimited $0 commission trading on U.S.-listed stocks and ETFs

Margin interest is 12.25% for up to a $10,000 balance and 10.00% at $250,000. Inactivity fee is $15 per quarter. It's waived if you make at least five trades per quarter or maintain a minimum $50,000 balance. No fee to close an account. Account transfer fee is $25 for a partial transfer and $80 for a full transfer. Exercise and assignment fee is $20. Wire fees are $35 for domestic and $80 for international. Incoming third-party wires that are returned trigger a $25 fee charged to the account. No fee to send a paper check. Paper trade confirmations are $3 each.

Paper statements are $5 each.

Live broker fee is an additional $20. 

How This Broker Makes Money From You and for You

With fewer brokerages charging commissions these days, it's less obvious how they stay in business. Here are some of the behind-the-scenes ways Lime Financial makes money from you and for you.

• Interest on cash: Idle cash held in your account earns no interest, and Lime Financial offers no cash sweep program. However, you can select a money market fund (from five available funds) and transfer the funds manually.
• Margin interest: Lime Financial's margin interest rates are below average for the industry. The rate is 12.25% on balances less than $10,000 and 10.00% for balances over $250,000.
• Payment for order flow: Some brokers earn money by accepting payments from market makers for directing equity and options orders to them—a practice called payment for order flow (PFOF). According to Lime Financial, the company accepts an average of $0.00056 per share for stock transactions and no payment for order flow on options.
• Stock loan programs: These programs generate revenue for brokers when stocks held in customers' accounts are loaned to other traders or hedge funds, usually for short sales. Lime Financial now offers a stock loan program, but it did not provide any details for our review.
• Price improvement: Lime Financial does not disclose its price improvement practices.
• Portfolio margining: Lime Financial offers eligible customers portfolio margining, which computes real-time margin for stock and options trades based on risk instead of fixed percentages.

Account and Research Amenities

Investors have the ability to trade directly from the price chart, the ability to customize the platform, and the ability to customize the price chart in Lime Trader. These customizations, along with the low-latency and high-volume trading platform offers investors services that other brokers simply cannot.  Lime does not offer any research to investors.

Stock Screener

Investors can choose ready-made templates when searching for securities, as well as creating their own. Selections can be made to screen stocks regarding which exchange, security type, and market sector, allowing investors to use both general and complex parameters based on fundamental and technical analysis.

ETF Screener

Lime Financial does not offer screeners specific to ETFs.

Options Screener

Lime Financial does not offer an options-specific screener.

Fixed Income Screener

Lime Financial does not offer a fixed income-specific screener.

Tools and Calculators

Lime does not offer proprietary trading calculators at this time. However, the hedge fund-style tools and low-latency platform that Lime offers to traders and investors is pinnacle within the industry.

Charting

Lime offers option charting and historical option pricing on the Lime Trader platform. Investors are also able to view real-time stock charts, both historically or broken down as precisely as to the minute within a trading day.

Trading Idea Generators

Investors can create watch lists, but the platform does not offer any sort of trading ideas generator currently.

News

Lime does not provide news feeds. 

Third-Party Research

At this time, Lime does not offer any third-party or proprietary research to investors. 

Cash Management

The company does offer a money market fund option that offers a small amount of interest on cash in the account. It is available for all account types, but users must opt in after the account is open.

Dividend Reinvestment Plan (DRIP)

There's no option to specify dividend reinvestment when you buy a dividend-paying stock. 

SRI/ESG Research Amenities

Lime Financial does not enable customers to screen based on environmental, social, and governance (ESG) or socially responsible investing (SRI) factors.

Portfolio Analysis

Lime Financial doesn't offer any portfolio analysis tools or options from third parties at this time. Unrealized and realized gains/losses are reported in real-time, as are margin and buying power. There are no tools to help you calculate the tax impact of future trades, although you can export tax-related reports to Excel and Quicken.

Education

Lime Financial provides little education about trading and investing strategies beyond an FAQ page. Because Lime Financial is primarily aimed at the intermediate/experienced crowd, investors who need more education will need to find alternative resources. However, investors can utilize the “Learn” tab on the website to access “Lime Insights,” which does provide informational, investing articles.

Customer Service

• Phone support is available Monday - Friday from 9 a.m. to 5 p.m. EST, excluding holidays. Phones are answered quickly by a human.
• Live brokers are available when phone lines are open.
• Lime Financial accepts non-U.S. customers who don't live in OFAC-restricted countries. The list of restricted countries includes Afghanistan, Bosnia & Herzegovina, Belarus, Central African Republic, Cuba, Democratic Republic of the Congo, Guyana, Iran, Iraq, Laos, Libya, Mali, Myanmar, North Korea, Russia, Somalia, South Sudan, Syria, Uganda, Vanuatu, Venezuela, and Yemen.

Security and Reliability

• Online account information is completely encrypted by proprietary technology. 
• Lime uses a 64-bit block cipher and supports a variable key length of 32 bits to 448 bits. What this means is that a block of your personal data is taken and is scrambled with a key created from your password to make it unreadable. 
• Data that is sent to clients is never cached in an unencrypted format on the computer that you are using so that your account information cannot be retrieved from the web browser’s cache files.

Transparency

Lime Financial's pricing structure and fees are fully displayed on the website, however, they can be a bit difficult to understand. Fees are very specific to the type of account that you have and the type of trade that you are making.

What Type of Account Should I Open at Lime Financial?

Lime financial has an extensive offering when it comes to account types. Lime Financial offers the following accounts:

• Individual
• Joint Tenents with Rights of Survivorship (JTWROS)
• Joint with Tenants in Common (JTIC)
• Custodial
• Traditional IRA
• Roth IRA
• Rollover IRA
• SEP IRA
• Corporate
• Limited Liability Company (LLC)
• Partnership
• Sole Proprietorship
• Trust

Final Verdict 

Lime Financial’s focus is offering a state-of-the-art technology trading platform to experienced investors. The low-latency platform is perfect for sophisticated, high-volume traders who want direct access to the markets. Lime’s attention to this niche is evident in their ability to beat the competition by fractions of a microsecond in order to more rapidly execute investors’ orders. This focus on the high-end of the sophisticated trader market means that Lime Financial doesn’t devote a lot of resources to anything else. You either need their low-latency market access to make money with high-frequency trading, or Lime is not for you.  As such, Lime Financial is not recommended for new investors. Many of the intricacies that make this platform unique in the industry and are pivotal to service their niche trader would only stand to confuse a new investor. Score Priority had a focused vision of its target market of active traders, yet didn’t have the technology to fully serve this type of trader. Picking up Lime and rebranding as Lime Financial has allowed the company to more adequately and competitively serve experienced, high-volume traders. If you aren’t in that select group, it is best to look elsewhere for a broker to serve your portfolio needs.