Higher Stock Broker Fees Should Give You More in Terms of Service

There exist two main types of brokerage agencies, discount brokerages and full-service outfits. For each transaction that discount brokerage firms make for a client he may pay stock broker fees amounting to anything up to $20 USD. Broker fees paid to full-service companies are much higher, as much as $700 USD. Besides the transaction fees, maintenance fees may be charged to those accounts that have failed to reach a certain transaction-quota. Maintenance fees may be as high as $200 USD.The difference in the rates between discount companies and full-service companies is justified by the stock listings and the services of the outfits. Discount brokerage companies usually offer a limited range of options for the investor to pick from. Furthermore, such outfits will usually do nothing along the line of trading tips and advice or market research. They transact what the client wishes to transact and leave it at that. Since discount brokers do not assist the client in any way in arriving at his market decisions, they are not given commissions. They get regular salaries.

Therefore, discount brokers are only ideal for investors who are already knowledgeable about the tricks of playing the stock market and are able and willing to do their own research and reading on the current state of the market for specific products.Full-service agencies provide the client with all the knowledge, expertise and experience needed for him to be able to make sound marketing decisions. The offerings they have are extensive and will usually also be impressive. The full-service broker not only gives advice about stocks that the client is interest in, but also presents suggestions about what new stocks the client should buy. The reason for this solicitation is because they are paid their commissions each time the client transacts stocks, whether by selling what he has or acquiring new ones.Obviously, paying full-service stock broker fees are more suitable for anyone who knows very little about stock trading should go in with a reliable full-service brokerage firm. Another good reason to pay for full-service is when the client himself, although familiar with stock trading, does not have the time to do research on the market.Besides the two general classifications of brokerage firms, the record of performance of one firm will be different from the next. Their rates and company policies may be slightly different from the standard. The best way to ferret out the right brokerage system for yourself is to visit these brokers one by one and make a comparative listing of their offerings, their rates and their business policies.

Of course you will need a preliminary listing of the top n brokers currently. You can find such listings websites. Additionally, some websites have step-by-step guides on how to find the appropriate stock broker for you.But then the investor should also be aware that it is perfectly possible to transact stocks without the aid of a stock broker and even without sufficient knowledge about the business. Index fund, mutual funds, Dividend Reinvestment Plans, Direct Purchase Plans as well as the purchase of bonds will not require broker intervention.

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