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Question: If the brokerage fee for investing is $15,do i have to pay that everytime i add money into my stock investment?

(Posted by: Rascuache on 2010-09-02 07:05:42)

Say I have $1000 to invest in stock. Now suppose I want to invest $500 in one stock, $500 in another. My brokerage trading fee is $15, so I assume that means I have to pay $30 to begin these 2 investments (I'm not actually sure, I don't yet understand brokerage fees) If i want to add $100 dollars to each investment in a months time, will I have to pay another $30?

Posted by: muncie birder on 2010-09-02, 09:50:30

Each time you buy or sell a stock, the $15 fee is charged no matter whether you buy $10 worth of stock or $10,000 worth of stock. If you want to invest in increments of $100, a no fee option is to invest in a mutual fund. I say no fee but that is not exactly correct. Mutual funds do charge an annual fee that is a % of the amount invested. But no load mutual funds do not charge to buy or sell shares. They do however have a minimum initial investment and also a minimum subsequent investment which is generally around $50. The initial minimum varies by fund but can be as little as $500 for a few. The most frequent minimum is about $2500.

Posted by: Caveat Emptor on 2010-09-02, 07:07:17

Each transaction (buy or sell) will be assessed the fee. It is PER TRANSACTION. That's why it isn't cost effective to buy stocks in small increments.

Posted by: Alex on 2010-09-02, 07:21:31

Yes you do. The brokerage fee is always per transaction. The only way to get out of this is to buy a no-load mutual fund instead, which will allow you to purchase additional shares commission-free. Other options could be certain ETFs (like QQQQ) that have the option of purchasing shares at regular intervals in order to cost-average. Check your options with your broker (depending on what stock or security you want). Good luck with your investment!

Posted by: Aromatic on 2010-09-02, 09:34:33

Yes, each trade, buying or selling, will be charged commission. If you're only investing $1000, I would suggest a place like Zecco, it offers trades for only $4.50, which is great. With $1000 a $15 commission would really hurt your profits.