Cheap But Good Place to Open Account for Stock Trades

[retiringby50]

I used to have an account w/TD Waterhouse, now Ameritrade, about 5 years ago but closed the account. I'm a mutual funds gal, but DH was mentioning that we should have an account in case he wants to buy some stock in his growing employer. For those who may have seen my post on the "Would You Share" thread, last night he suddenly said, "Now that we have some money..." I guess he's thinking his name's not on the money, but I'm still sharing! That's okay though, but it was sort of funny at the time.

I'm leaning towards Ameritrade because I can open w/a $0 balance and then transfer money later on with no fee, buying and selling stock online cost $9.99 each time, and there is no maintenance fee and no minimum in the account. Any other suggestions? Thanks.

 

[Lakedog]

I have been with Ameritrade for several years and have been pleased with the service (have a couple of accounts there -- Roth and taxable). The few times I have had a complaint, they have at least offered up several free trades to make me feel better. I have no experience with other brokers though.

 

[Urchina]

We've been happy with Scottrade. $7 trades for stocks, somewhat higher for mutual funds depending on the fund family you choose. There's offices in several locations, and I've found their internet interface to be easy to understand and navigate. They also have a nice "Gainskeeper" feature that figures returns for you.

 

[growing_older]

I have an account with TD Ameritrade, or whatever they now call themselves and have had no problems. They are not the cheapest, but they have been reliable and I have no complaints.

That said, you probably want to have a plan for investing your money, whether in stocks or mutual funds or whatever, that is well developed and thought out. If you want to let your husband play with a small portion of the funds, and he wants to buy on whims, that probably won't hurt you too much. If that becomes your investment plan for substantial assets, you will likely regret it.

 

[Orchidflower]

Sharebuilders.com is or was $4 on Tuesdays.

 

[LOL!]

We are long-time TDAmeritrade (nee TDWaterhouse) brokerage customers. We even used the TDWaterhouse Bank exclusively for years and years.

But now we do all our banking and trades at WellsFargo with their PMA relationship. You get 100 free trades a year including Vanguard mutual funds and free banking. You need a $25,000 minimum in your combined accounts (includes IRAs, brokerage) for all the free-ness. It is easily the best deal out there now for folks who can meet the minimum. It's a great bank and a very decent brokerage.

I will admit that we still have our TDAmeritrade (apex-level) account, but only to hold legacy stocks and ETFs and to use the real-time Level II quotes not available at WellsFargo.

 

[DangerMouse]

But now we do all our banking and trades at WellsFargo with their PMA relationship. You get 100 free trades a year including Vanguard mutual funds and free banking. You need a $25,000 minimum in your combined accounts (includes IRAs, brokerage) for all the free-ness. It is easily the best deal out there now for folks who can meet the minimum. It's a great bank and a very decent brokerage.

We have the same setup with WF as LOL and have to agree with his comment that it is a great deal. BTW do you see they have now added a feature that tells you how many free trades you have left and what date your counter resets. You might think that you would never use 100 trades in a year, this year I have used 61, having the free trades allows me to DCA most of my stock purchases. I usually make 1 trade a week.

 

[dgalbraith100]

If you want Ameritrade check out:
http://www.izone.com

Its ameritrade, but cheaper. It has to be a Taxable account, and they will force you to enable Margin on the account (enable, not use)... for those trade-offs, you pay $5 per trade, and use the ameritrade interface. The nice thing is you can link your other ameritrade accounts to it, and flip between them, view combined reports as if they were one big happy family. If you are in your taxable, its $5 a trade, if you are in your IRA's its 9.99 a trade... and you can just select which account you want to view from a drop-down.

You don't get the ameritrade streamer/other perks with out subscribing, but you can use most of those from one of your other ameritrade accounts anyway... One gotcha, it takes 5K to start the account.

I see no reason to have a Taxable with "Ameritrade" that isn't an Izone account. (least not if you have IRA's that qualify for their "Apex" account, that gets you free perks)... Use that account to get all the "perks" and the Taxable account as an Izone. You don't get much cheaper than $5 a trade. (There are some places that are cheaper, but have strange and funny restrictions, and are of a size that I'm concerned about them going under tomorrow).

Their rates on their MM sweeps are crappy, so don't leave money in the cash portion of your account there.

Laters,
-d.

 

[Lakedog]

Their rates on their MM sweeps are crappy, so don't leave money in the cash portion of your account there.

If you are with TD Ameritrade (Apex) ask for your sweep to be their MM Portfolio Investor Class fund, the rate has been as high as 4.5% but currently is around 3.5%.

 

[free4now]

The last time I looked into this, probably 8 years ago or so, it seemed that brokerages that offered super cheap trades were the ones that gave the worst executions... they would route orders to market makers that wouldn't give the best bid or ask prices. Then those market makers would rebate a portion of the bid/ask spread back to the brokerage in exchange for your sale. This was how some brokerages were able to offer free trades and still make money.

So I tried to choose my brokerage based not on the trading fee but on how well the trades were executed, who would route orders well.

Lately I have been able to count my number of trades per year on one hand, so I haven't bothered to keep track of this stuff.

 

[sailor]

... and they will force you to enable Margin on the account ...
... I see no reason to have a Taxable with "Ameritrade" that isn't an Izone account.

It can cost you big money.
IIRC enabling margin allows them to borrow underlying securities for short sales.
If this would happen in your taxable account you might find that your qualified dividends morphed into "replacement dividends" taxed at your marginal tax rate.

Nevertheless I would not deal with Ameritrade which is known to loose their customer information to spammers and dealing with it well over a year after people started to tell them that they have issues.

 

[Nords]

It can cost you big money.
IIRC enabling margin allows them to borrow underlying securities for short sales.
If this would happen in your taxable account you might find that your qualified dividends morphed into "replacement dividends" taxed at your marginal tax rate.

Yup, although that's pretty standard practice across the industry, although you may be able to specify which shares are not to be loaned.

A few years back a friend of mine (similar to the guy in the E-Trade Super Bowl commercial) signed up for an account with a (now defunct) brokerage's website. Eager to start his investing fortune, he kinda skipped over the fine print that mentioned he'd also signed up for margin.

When he clicked the "Execute" button on his first order, it appeared not to take. So he clicked it again, got his confirmation, logged off happy, and moved on to other things.

When he got the margin call a few days later, he realized that his two clicks had made two purchases-- one with his money and a second iteration of the same order with the brokerage's money. "Customer service" was time-consuming, oxymoronic, and ultimately futile.