How do trading commissions work?
Question:
For every stock I want to buy (100 of a, 100 of b, etc.), I will get charged $12.99 per stock order?
Answer:
Yes, that is correct. If you're using a broker with 12.99 commissions then you'll be charged 12.99 for both the buy and the sale transactions. You might be charged more for a limit buy/sell transaction too. However, if you're paying 12.99, you're probably paying too much. Scottrade is a very popular online broker with perks for new investors like no minimum balance and $7 commissions.
My favorite broker, though, is TradeKing.com. They also don't require a minimum balance in your account and they have a MySpace-like community so that you can read other people's perspectives on trading. TradeKing's commissions are $4.95 per trade, whether limit or market. There are a few commission-free brokers out there, but they usually require a minimum balance of $2,500-5,000 in the account.
12.99 is way too high. Too many good ones with lower rates scottrade has instant access to an ach account (transferring money) tradeking charges 15 for no load mutual funds (pass) no load means no load period. zecco is a new kid no commission charges but serious issues have poped up with them and I am not overly impressed with their response time so far.
It will be added to the total amount of principal invested.
When you sell there is a small S.E.C. fee. charged on top of the $12.99.
That amount of commission seems kind of high.$9.99 is alot better.
Actually,Bank of America in certain states is offering 25 free trades per month with a $25,000 maintained balance.
Best of luck...Yes,100 of A $12.99,100 of B $12.99 etc.
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