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Donít Under Estimate Customer Appreciation
Old 04-28-2016, 05:29 PM   #1
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Donít Under Estimate Customer Appreciation

I use two different brokerage firms as I am a believer in the ďDonít put all of your (nest) eggs in one basketĒ theory. I was surfing the net on different brokerage sites and came up upon an offer from Fidelity that caught my eye. They were offering up to $2500 dollars to open an account with them. It just so happened, that I needed to visit my brokerage (which is Scottrade) in order to fund my last SEP contribution. During the conversation with the office manager, I asked him if there was anything that he could do for a legacy account holder. He said that he could give me a $100.00 bonus in addition to 50 free trades and a 15% discount on future trades. I thought that was nice so I left happy. Being retired and having some time on my hands, I called Fidelity and asked them what they could do. By the time I got off the phone with them, they offered me $5000.00 to switch. In addition, they said that they would pay the transfer fees and match the commissions that Scottrade charged. I thanked him and contacted Scottrade to tell them what they had offered. I never had a problem with them and felt an obligation to let them match the offer. They did. 5 grand for a couple of phone calls. BTW, I do not consider myself a high frequency trader. I generate maybe $500.00 a year in trades. It really doesnít make much sense to me. It will take them 10 years to break even. Am I missing something? Anyway, I thought I would share my experience with you so that maybe you could benefit.
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Old 04-28-2016, 05:56 PM   #2
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Good job on negotiating a sweet deal.
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Old 04-28-2016, 05:58 PM   #3
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Thanks for sharing. Great advice for anyone considering the same.
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Old 04-28-2016, 06:06 PM   #4
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The amount they offer depends on the balance of the account. No broker will offer $5K for a small account. But even if the account is greater than $1M, a $5K windfall bonus is nicer than I would expect.
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Old 04-28-2016, 11:17 PM   #5
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Good deal, it must have been a large account.

I think they make money from lending out your stock to option traders.
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Old 04-28-2016, 11:29 PM   #6
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Good deal, it must have been a large account.

I think they make money from lending out your stock to option traders.
Only if you have a margin account.

Otherwise it's just commissions and fund fees.
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Old 04-29-2016, 05:48 AM   #7
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Must have been a large account. Makes you wonder.

5K could be what it costs to land a new, larger customer.
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Old 04-29-2016, 10:33 AM   #8
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When we transferred from a full service broker to a discount broker the latter paid the transfer fees on trading accounts and our registered accounts. Worked out to about $1200. No other incentives...I was just happy to have my costs covered. Perhaps I left some money on the table?
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Old 04-29-2016, 11:03 AM   #9
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These huge brokerages have all sorts of ways to make money off your investments, far beyond $7.95 commissions and expense ratios.
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Old 04-29-2016, 11:28 AM   #10
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Like what? They aren't allowed to loan my shares. I don't have a margin account.
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Old 04-29-2016, 01:16 PM   #11
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Some charge costs on processing dividends.

But I expect something more pedestrian is going on. You just get discounts and incentives based on what you might trade given your account size.
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Old 04-29-2016, 02:49 PM   #12
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Hmm, I'm also curious how you can get such a sweet deal. The OP must have a serious balance at Scottrade, IMO.

We've got a joint brokerage account at Capital One and I'd love to transfer to a brokerage that can convert /set-up our holdings to a trust type account as Capital One doesn't offer such accounts. However, to transfer we'd be charged $50 per stock. Maybe if I was able to find such a deal like OP I'd move.

Anyway this post got my brain thinking
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Old 04-29-2016, 02:59 PM   #13
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I also had my accounts split between Fidelity and another broker. The other had given me a couple issues over the last year, and when Fidelity made the $2500 offer I shifted my funds at the other over to Fidelity. I do find it more convenient having consolidated at one firm.
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Old 05-01-2016, 11:07 AM   #14
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Hmm, I'm also curious how you can get such a sweet deal. The OP must have a serious balance at Scottrade, IMO.

We've got a joint brokerage account at Capital One and I'd love to transfer to a brokerage that can convert /set-up our holdings to a trust type account as Capital One doesn't offer such accounts. However, to transfer we'd be charged $50 per stock. Maybe if I was able to find such a deal like OP I'd move.

Anyway this post got my brain thinking
Are you sure its not $50 per account ?
That $50 per stock is outrageous, never heard of that before.
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Old 05-01-2016, 12:11 PM   #15
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Wow, I think I need to move around, at least threaten Fidelity I will move.
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Old 05-01-2016, 12:11 PM   #16
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Are you sure its not $50 per account ?
That $50 per stock is outrageous, never heard of that before.
I believe that Scottrade charges $50.00 per account so the transfer fee to another brokerage would have been $150 for 3 accounts. 50 bucks per position does not sound right.
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