Entries Tagged 'Brokers' ↓

Recently, I received an email from Zecco about changes to my account. This makes the second change within the time I have had an account with Zecco. I transferred my portfolio from Scottrade to Zecco to save on commissions. Then, the first notice came stating that my account had to be valued at $2,500 to receive 10 free trades; before it was unlimited free trades no minimum. Big difference but I didn’t make many trades in this account, so, I keep the account open. This morning, I woke up to another email from Zecco stating that my account has changed once again.

Now, Zecco wants $25,000 for you to get 10 free trades, this is the same value that gives you 100 trades per year with Wells Fargo and 30 per month with Bank Of America. Why would anyone want to stay with Zecco? When I opened the account, they were all about helping the little guy; $25,000 isn’t necessarily a little guy. I used Zecco to build a dividend portfolio for investment income but with the ever changing terms over my time with Zecco, I think its time for me to say goodbye.

So, I am transferring back to Scottrade which I have been using for research, since Zecco lacked it. Commissions might be a little higher but I am ready to pay extra cost for more certainty. Scottrade also offers fixed income, which Zecco lacked.

I look for Zecco to go belly up, as many people left them on the first change to commissions. There is currently no reason to go to Zecco. Commissions are still $4.50 but the platform is probably the worst in the industry and costumer service is poor, probably worse now with the mass exodus.

I thank Zecco for the free trades but with so many changes to their business model since being with them, I get a feeling the company might be in trouble. So, I am getting out now before getting hit with higher commissions and fees if I wait.

UPDATE: In order to qualify for 10 free trades your account must be valued at $25,000.

Looking for an easy way to cut your investing commissions? Many investors pay up to $10 per trade. If you have millions to invest, I guess $10 is nothing more than change, but the fact is, many non professional investors don’t have anywhere close to millions to invest and that $10 could be better used working for you. Zecco offers investors the opportunity to put that $10 to work. If you make 1 trade per month and saved that $10 in a high yield savings account at a modest 3% interest rate you would have $5,581.94 after 30 years. With the market average of 10% per year, that’s $22,803.25 from just $10 a month.  Isn’t it time for you to drop your commissions?

Zecco Account Requirements
First, before going any further you should know the requirements for opening a trading account with Zecco. In order to receive free trades your account value must be at least $2,500 $25,000. There is no minimum account value for cash trading; margin accounts must open an account with at least $2,000 and maintain at least $2,000 to trade on margin.  If you meat the $2,500 $25,000 account level, you receive 10 free equity trades per month.

Zecco Commissions

Equity Trades (Stocks and ETFs)
If you don’t meet the $2,500 $25,000 account level or go over the 10 free equity trades, you will only pay $4.50 per trade; still one of the lowest commissions in the industry.

Options
Option trades are $4.50 plus $0.50 per contract. Once again, Zecco is one of the lowest commissions among discount brokers. Exercise and Assignments are $4.50.

Mutual Funds
If you are a mutual fund investor, Zecco might no be for you. No Load Funds are $10, broker assisted $19.99.

Learn More About Commissions

Who Is Zecco For?
Zecco is NOT for active day traders; you’re better off going to a direct access broker. For those who are looking at building an income portfolio, those who swing trade, or just a small investor investing for the long haul, Zecco is a great way to decrease your commissions or eliminate them all together.

Research tools at Zecco are rather limited but are constantly improving and they are adding more tools. Many sites are available online to conduct stock research and you really don’t need your broker. Yahoo Finance, Google Finance, and MSN Money offer a lot of information for investors to use. Spend some time digging through these sites and you’ll find almost anything you want.

How Can Zecco Offer Free Trades?
Well, take a trip to their site and you will see something that is uncommon with brokers…advertisers. Zecco uses advertising to make some of their income. They also make money off interest, which almost every broker does. Then of course, they make money off commission when applicable.

I use Zecco for an income portfolio and a few swing trades. I am satisfied with the service.

No longer using Zecco, I wen’t back to Scottrade! Read Why.

For almost a year now, I have been using ThinkOrSwim and have been very happy with the service and the frequent updates of their trading platform but will my experience remain good when they hand things over to TD AMERITRADE.

ThinkOrSwim has a service like no other with a great trading platform with free live data, no charge for software usage, and even a couple chat rooms. The design of the platform is for active traders and concentrates on those trading options. My use of ThinkOrSwim has been primarily for options and futures trades.  These mergers between online brokers never workout for the better for those affiliated with the company being bought.

ThinkOrSwim is expecting to hand over the reigns in about 6 months.  As for me, I look to find a new broker.  I am thinking about going to Interactive Brokers or TradeStation.
Both offer low cost commissions for both active and not so active trades.

I hate to leave ThinkOrSwim but I have seen these mergers before and as soon as they go through, commissions rise and they start instituting fees for everything from software to being inactive, and so forth. TD AMERITRADE customers will get a better platform and ThinkOrSwim customers will get higher fees and commissions.

I guess I will have to wait and see what happens but for now I am looking into other brokers.

Know of a good online broker for an active trader? Leave a comment.