Online Brokerage Commisions
I recently started an eTrade account, and started investing. I found out that the $9.99/trade that they advertise is not really true upon reading the fine print. I finally found a good link to the actual commisions and fees, and found out that I will never (at least, thinking realistically) qualify for the $6.99-$9.99 commisions. So, I decided to check other brokers and see what their conditions are as well, and conglomerate what I found here:
eTrade
| Qualifications | 1500+ trades/quarter |
150-1499 trades/quarter |
$50,000+ in assets or 30-149 trades/quarter |
Less than $50,000 in assets and 0-29 trades/quarter |
| Stock and Options Trades | $6.99 | $7.99 | $9.99 | $12.991 |
| Simple Options (options contract fee per contract) |
$6.99 plus $0.75 | $7.99 plus $0.75 | $9.99 plus $0.75 | $12.99 plus $1.25 |
| Options Contract Fee | $0.75 | $0.75 | $0.75 | $1.25 |
Holy Crap! Who makes 1500+ trades per quarter??? Obviously, a poor guy like me has to pay a full $12.99. In fact, I’m willing to be that more than half their customers pay that since $50,000 is a lot.
Fidelity
These guys lure you with $8/trade propaganda, but when you go look at their page, you find this:
Very similar. Unless you’re rich, you pay $19.95 per trade! That’s Terrible!!!
Ameritrade
Wow. I browsed around, and even skimmed their terms and conditions, and couldn’t find anything other than $9.99/trade with no conditions. This seems like a good deal, but then I googled it. Here’s what I found.
Scottrade
These guys seem pretty good as well. The offer $7 commistions (which is very low) with these conditions:
For stocks priced under $1, add 1/2% of the principal value to the commissions shown. Some Foreign and Pink Sheet stocks must be traded with broker assistance. Commissions are charged on a per order basis. Limit orders executed over multiple days and orders modified after a partial execution on the same day will be treated as separate orders for commission calculation purposes. A majority of orders must be executed online to qualify for the online commission rates. Scottrade receives compensation for certain equity and option orders as described more completely in our Rule 11Ac Disclosure. Generally, this compensation will take the form of payment for order flow, profit sharing arrangements, liquidity rebates or possible trading profits if Scottrade executes the order as a Principal.
So, if you are planning on trading Penny Stocks, this might not be for you since they might have to be broker assisted, which costs more than $30. The reviews sound a lot better than Ameritrade’s.
Schwab
Well, seems about like Fidelity. Unless you’re rich, $20 for you per trade. Sad.
| Number of Household Trades per Quarter | Less than $50K Household Balance | $50K to $999,999 Household Balance | $1,000,000 or more Household Balance |
| 0 to 8 | $19.95 | $12.951 | $9.95 unlimited |
| 9 to 29 | $12.951 | $12.951 | $9.95 unlimited |
| 30 or More | $9.95 unlimited | $9.95 unlimited | $9.95 unlimited |
| Commissions for executed online equity trades up to 1,000 shares and $0.015 for each additional share. |
I might add more later since there are so many to choose from, but I laid out the big ones so far. I would have to say that eTrade is worth the $12.99 per trade since you get so much with it – Java Streaming Live Quotes, Great interest rates if you bank with them (including waived ATM fees), etc. Scottrade is cheap, but as the reviews tell, very barebones. I would personally stay away from Schwab, Fidelity, and Ameritrade, since the first 2 cost a fortune, and the last has terrible customer service.
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