I'm new: Question about brokerage

[Bathory]

Hi all

I'm new here and have a question...

I Recently acquired 100 shares, and I'm interested in buying some more. However I don't have alot of money to invest all at once.

I notice on etrade that they advertise You can trade shares from as little as A$21.95 per trade, and the brokerage on the shares is $32 for the first 10 trades.

Does this mean I can just buy like $50 or $100 worth of shares for my first purchase. I just want to get in and get a feel for it all.

I'm sorry if this is a dumb question ,or if it has been answered before.

 

[prawn_86]

Re: I'm new here and have a question

check the beginers lounge for a lot of questions like this.

The search function is very useful.

Most brokers only let you buy a $500 minimum parcel

 

[Joe Blow]

Re: I'm new here and have a question

Hi all

I'm new here and have a question...

I Recently acquired 100 shares, and I'm interested in buying some more. However I don't have alot of money to invest all at once.

I notice on etrade that they advertise You can trade shares from as little as A$21.95 per trade, and the brokerage on the shares is $32 for the first 10 trades.

Does this mean I can just buy like $50 or $100 worth of shares for my first purchase. I just want to get in and get a feel for it all.

I'm sorry if this is a dumb question ,or if it has been answered before.

Hi Bathory,

Welcome to ASF!

I believe Prawn has it right when he says a $500 parcel is the minimum you can buy.

In future, please try and make your thread titles a little more specific. "Newbie question about brokerage" is more informative and lets others know what your query is regarding.

 

[Santob]

Re: I'm new here and have a question

If you're planning on buying $100 worth of shares, and going to spend $44 in buying and selling transactions. Thats an increase of 44% before you even break even.

 

[SevenFX]

Re: I'm new here and have a question

I notice on etrade that they advertise You can trade shares from as little as A$21.95 per trade, and the brokerage on the shares is $32 for the first 10 trades.

Gday Bathory.

You may like to check out Commsec, as they're prob the cheapest, yet reliable when it comes down to what you will prob initially need (buy n hold).

You don't have to trade any number of time (eg etrades 10) to get their $19.95 if trades are under $10,000, which is great for a Internet trade.

http://www.comsec.com.au/Public/WhatItCosts.aspx

There's plenty to read on here, so enjoy.

Cheers
SevenFX

 

[Gar]

Re: I'm new here and have a question

Hey Bathory (named after the band?)

If you're a little scared to invest big money at first you might be interested in looking at CFD's, the brokerage for small trades is much cheaper (sometimes as low as $8 or $9 each way) and you can go long or short (bet on up and down moves)

Another thing to look into is paper trading, you wont get the same experience as trading with real money but its probably better than trading with the amounts you mentioned, $50 - $100 is not really viable.

Get in and have fun mate, just dont be reckless

 

[Bathory]

Re: I'm new here and have a question

sorry about the thread title , you can change it if you like...
thanks for the quick replies..

etrade through my credit union is offering me $550 free brokerage at the moment, it sounds like a good deal , like if I buy $100 worth of shares and get the free brokerage, but what your telling me is that I have to spend at least $500 on etrade?

 

[prawn_86]

Re: I'm new here and have a question

If you're a little scared to invest big money at first you might be interested in looking at CFD's,

I dunno about that Gar.

In fact i would personally advise strongly against it. Too easy to get a margin call with small amounts and lose the whole lot off a small (<5%) movement

 

[Sean K]

Re: I'm new here and have a question

I dunno about that Gar.

Yep, as a new investor, only put in what you can afford to lose. You really need to learn the game before going margin IMO.

 

[Gar]

I probably should have added that it should be low risk guaranteed stop account but now that I think of it you are probably right prawn.

too tempting to open oversized positions

 

[SevenFX]

Re: I'm new here and have a question

If you're a little scared to invest big money at first you might be interested in looking at CFD's, the brokerage for small trades is much cheaper (sometimes as low as $8 or $9 each way) and you can go long or short (bet on up and down moves)

Another thing to look into is paper trading, you wont get the same experience as trading with real money but its probably better than trading with the amounts you mentioned, $50 - $100 is not really viable.

Get in and have fun mate, just dont be reckless

I have to definetly DISAGREE with Gar's first suggestion, this is the wors't thing a NEW investor/Trader could do. IMO

Agree with Gar's Second suggestion, as paper trading should be done, and make all the miskates you will make, till your more experienced and can make smaller mistakes with real money, as opposed to paper trading money.

As Kennas said, initially only invest with money you can afford to lose.

Enjoy Investing and tread it like your very own business, as it Is, where you profits are maximised and your losses are minimised.

SevenFX

 

[nizar]

Re: I'm new here and have a question

Gday Bathory.

You may like to check out Commsec, as they're prob the cheapest, yet reliable when it comes down to what you will prob initially need (buy n hold).

I can only speak for myself here.
But from my experience i have found Commsec to be ANYTHING BUT reliable.

 

[SevenFX]

Re: I'm new here and have a question

I can only speak for myself here.
But from my experience i have found Commsec to be ANYTHING BUT reliable.

Yes Commsec have had problems, as Etrade have had their fair share, and no doubt both of them will have in the future, but generally speaking IMO they are reliable.

Especially for $19.95 brokerage, so if I'm gonna have problems with any of the bigger Internet brokers, I'ld rather have it with the bigger cheaper one... lol

Also worth noting members were complaining of etrade being down for 3-5days at a time on one occasion, where Commsec has not been down for more than hours at most 3/4 of a day.

SevenFX

 

[Bathory]

Again thanks for the replies all

However im still unsure

I have 100 shares at about $1.20, can I register with etrade and buy 100 more with the $550 free brokerage they are offering me to signup ?


Bathory (yeah from the band)

 

[SevenFX]

Again thanks for the replies all

However im still unsure

I have 100 shares at about $1.20, can I register with etrade and buy 100 more with the $550 free brokerage they are offering me to signup ?


Bathory (yeah from the band)

I say not, as you have a minimum dollar value you have to buy (usually $500 worth) and your 100 share @ $1.20 is gonna cost you only $120 (plus add your brokerage at $32)

You will have to buy 420 shares at $1.20 totalling $504.00 (plus add your brokerage at $32)

Your $550 free citibank brokerage offer gives 17 buy n sells @ $32.00 or 25 buys n sells at $22.00

Hope that helps..
SevenFX

 

[Bathory]

thanks tekmann


So why do they advertise You can trade shares from as little as A$21.95 per trade and not say $500 on there site.

i guess they mean A$21.95 per trade brokerage fee.

i also read somwhere on here that if you own shares already in a company you can by more small amounts....

 

[Gar]

Thats brokerage fee's and $22 brokerage is not entirely true, its $32.95 in and out unless you are executing more than 10 trades a month.

here is the table from their site:

First 10 Trades $32.95 <$30,000
11th to 20th Trades $27.45 <$25,000
21st & over $21.95 <$20,000

and stops and conditional orders cost extra

 

[SevenFX]

its $32.95 in and out unless you are executing more than 10 trades a month.

its $32.95 in and $32.95 out.

You can trade shares from as little as A$21.95

Bit of Marketing I guess in making it seem cheaper, thats why I referred Commsec @ $19.95 to you is because it's just that $19.95 no catches, gotch ya's.... so their no pressure to make 10 trades.

Maybe make fewer great trades, instead of making 10 average trades just to bring your brokerage down.

Don't get to hung up on the brokerage, as a beginer you shouldn't be making all that many trades, and most will tell you here, the brokerage will only hurt when you have a loosing trade, and not so much on a Winning Trade, so Focus on winning trades, and they will focus on you.

Brokerage, Stop losses, Taxes are all part of running your business, and can be referred to them as expenses, Profits can be reffered as Income, and needless to say the Income must be greater than the expenses.

After your $550 runs out with etrade, you may like to look at Commsec, or any other online discount broker to keep your brokerage down.

SevenFX.

 

[Gar]

its $32.95 in and $32.95 out.

thats what I said


I have an account with etrade myself but I don't think I would recommend them, the servers are down very often and when they are up the system is full of glitches

 

[Bathory]

Thanks for all your help

I will be reading more and hope to become a active member of your forum