Cost to buy stock
originally posted: 11/22/2006 reposted: 2/18/2011 This post has not been recently reviewed or revised by the author and may be out of date. If you notice an error or are in doubt, please send a new question by email or ask for an update. Email asktony@tonynovak.com.
Q: What is the cost per transaction to purchase stock?
A: Now anyone can purchase stock with no commissions or transaction costs by taking advantage of the numerous special offers from banks and brokerage firms using "free trades" to lure new customer accounts. But even if you do not take advantage of a special offer, the highest price paid using an online broker is usually $11. A few of the brokerage firms offer free trades with gimmicks or qualifications, so read the fine print to avoid surprises. The two brokerage firms I use most often for customer accounts are Bank of America and Scottrade that both offer straightforward pricing with no surprises. Bank of America now offers free unlimited online trading with no catches to its bet customers. A primary advantage is that money can be easily and quickly transferred back and forth from a regular bank account. For low balance customers, a trade cost $10. Scotttrade offers regular trades for $7 without account qualifications or gimmicks. In either case, you can open the account yourself or have a qualified financial adviser (an independent Registered Investment Adviser who is not affiliated with a Broker/dealer firm) do it for you. If you open the account yourself and then later want professional help, then another form is required called a limited authorization (see the link below).
Summary
More resources:
Cost to open IRA account Broker/dealer vs. custodian The Cost of Investing Comparison of Discount Brokerage Costs Scottrade Registered-Investment-Advisor-authorization.pdf