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Want to start trading online... any suggestions on which service to use?
Posted by: spacescape
Date: January 11, 2018 09:17AM
My 2018 goal is to start trading / investing online... Starting small... and looking for some suggestions. My good friend says "e*trade"... my other friend says "Fidelity"...

Anyone else have any suggestions?
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Re: Want to start trading online... any suggestions on which service to use?
Posted by: GuyGene
Date: January 11, 2018 09:51AM
I use TDAmeritrade and like it. Web site is good, fairly easy to understand. I also use USAA, but I don't think it's so easy to join. I like what I've heard about Scott Trade too. Go online and visit their sites.



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Re: Want to start trading online... any suggestions on which service to use?
Posted by: mattkime
Date: January 11, 2018 09:56AM
They're mostly the same.

I hope you have some sort of investment plan / strategy in place.

Its not my goal to 'trade' but to buy and hold.



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Re: Want to start trading online... any suggestions on which service to use?
Posted by: GGD
Date: January 11, 2018 10:00AM
Not sure where you're located, but I would look into Fidelity or Charles Schwab to see if either of them have an office near you. They've both been around for decades and have low commissions and physical offices which can be helpful. I've had accounts with both for about 30 years.

Many employers use Fidelity for their 401k management, which can be convenient if you already have a personal account there.

And once commissions dropped below about $10, the price difference between brokerages shouldn't be an important factor. If you're trading so much that it is, then you're probably more of a gambler than an investor. I think Schwab and Fidelity are both $4.95 these days.
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Re: Want to start trading online... any suggestions on which service to use?
Posted by: spacescape
Date: January 11, 2018 10:10AM
I have a 401K that I no longer can put anything into (won't get into that... but, can move $$$ around)... and an IRA (Which I haven't put much into as of late)... Both at John Hancock.

Does John Hancock have a brokerage that you can manage a little bit "by yourself".

Yes, I need a plan of action... not just tossing $$$$ in... But, lots of companies I haven't invested in because "I wasn't ready" that I wish I was...

Bill
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Re: Want to start trading online... any suggestions on which service to use?
Posted by: mattkime
Date: January 11, 2018 10:15AM
I recommend you take a trip over to bogleheads.org and talk over your financial picture and strategy. They're pretty conservative but its a good place to talk through everything like you would with a proper financial advisor. Obviously choose your username in such a way as to protect your identity.



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Re: Want to start trading online... any suggestions on which service to use?
Posted by: Ammo
Date: January 11, 2018 10:53AM
Quote
mattkime
. . . Its not my goal to 'trade' but to buy and hold.

That’s what Warren Buffet does, but what’s he know? :-) Seriously, I think most folks are better off with low fee mutual funds. There’s an army of very sharp professional investors out there who make it very tough for individuals to compete.



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Re: Want to start trading online... any suggestions on which service to use?
Posted by: ztirffritz
Date: January 11, 2018 11:02AM
I use CapitalOne Investing, formerly ING Investing, formerly Sharebuilder. Also Vanguard brokerage. I liked sharebuilder because it was a monthly purchase, I didn't need to think about it much. It just transferred funds, bought the stock, and sent me a notice every month. I acquired a bit of AAPL that way.



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Re: Want to start trading online... any suggestions on which service to use?
Posted by: freeradical
Date: January 11, 2018 11:14AM
Vanguard stock index mutual fund.
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Re: Want to start trading online... any suggestions on which service to use?
Posted by: mikebw
Date: January 11, 2018 11:16AM
Quote
ztirffritz
I use CapitalOne Investing, formerly ING Investing, formerly Sharebuilder. ... I acquired a bit of AAPL that way.

Same, but not as much I'm sure.
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Re: Want to start trading online... any suggestions on which service to use?
Posted by: pqrst
Date: January 11, 2018 11:19AM
Quote
GuyGene
I use TDAmeritrade and like it. Web site is good, fairly easy to understand. I also use USAA, but I don't think it's so easy to join. I like what I've heard about Scott Trade too. Go online and visit their sites.
Scottrade got bought out by tdameritrade and is expected to be completed in a month or two.
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Re: Want to start trading online... any suggestions on which service to use?
Posted by: Lux Interior
Date: January 11, 2018 11:48AM
If you send me the funds in the form of a cashier's check, I will be happy to manage your wealth!

I only charge a fee of 10% of portfolio value annually!
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Re: Want to start trading online... any suggestions on which service to use?
Posted by: TLB
Date: January 11, 2018 11:54AM
I've had a lot of people recommend Robinhood Markets to me but I haven't tried it yet. Free always seems too good to be true.
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Re: Want to start trading online... any suggestions on which service to use?
Posted by: raz
Date: January 11, 2018 12:03PM
I'd start with a pointed question ...

Are you trying to trade or to invest? If the former, then you're looking for a brokerage with the lowest transaction fees. If the latter, you're looking for a brokerage with the lowest maintenance fees.

Both will be determined by how much money you have and how often you trade.



--------------

Embarassing myself on the Internet since 1978.
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Re: Want to start trading online... any suggestions on which service to use?
Posted by: raz
Date: January 11, 2018 12:04PM
Quote
spacescape
I have a 401K that I no longer can put anything into (won't get into that... but, can move $$$ around)... and an IRA (Which I haven't put much into as of late)... Both at John Hancock.

Does John Hancock have a brokerage that you can manage a little bit "by yourself".

Yes, I need a plan of action... not just tossing $$$$ in... But, lots of companies I haven't invested in because "I wasn't ready" that I wish I was...

Bill

My wife's old 401(k) was at John Hancock. The fees were shockingly high. However, that might be the result of the cheapness of her employer.



--------------

Embarassing myself on the Internet since 1978.
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Re: Want to start trading online... any suggestions on which service to use?
Posted by: ka jowct
Date: January 11, 2018 12:14PM
Have a look at Vanguard.
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Re: Want to start trading online... any suggestions on which service to use?
Posted by: Michael
Date: January 11, 2018 12:56PM
We use Fidelity but I like Schwab's stock/fund evaluation better. So, I research stuff at Schwab and buy at Fidelity.
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Re: Want to start trading online... any suggestions on which service to use?
Posted by: CJsNvrUrly
Date: January 11, 2018 01:05PM
Quote
ztirffritz
I use CapitalOne Investing, formerly ING Investing, formerly Sharebuilder. Also Vanguard brokerage. I liked sharebuilder because it was a monthly purchase, I didn't need to think about it much. It just transferred funds, bought the stock, and sent me a notice every month. I acquired a bit of AAPL that way.

Me, too.




bunny smileyCentral VA
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Re: Want to start trading online... any suggestions on which service to use?
Posted by: Paul F.
Date: January 11, 2018 01:27PM
Been using E*Trade for more than a decade (hmm... maybe almost 20 years now!).
No complaints. I'm sure there's better, stronger, faster, etc, but ETrade has served me pretty well.
My own investment decisions, well, not as well, LOL.



Paul F.
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Persistence is necessary for Excellence. And Persistence is a Decision.

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Re: Want to start trading online... any suggestions on which service to use?
Posted by: NewtonMP2100
Date: January 11, 2018 01:50PM
....can this be used to trade....barbs and quips.....???



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Re: Want to start trading online... any suggestions on which service to use?
Posted by: billb
Date: January 11, 2018 01:53PM
Quote
NewtonMP2100
....can this be used to trade....barbs and quips.....???

No but you can corral them here: [forums.macresource.com]



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Re: Want to start trading online... any suggestions on which service to use?
Posted by: Winston
Date: January 11, 2018 08:28PM
1. John Hancock is likely one of the more expensive places to do anything. Please look at the fees they are charging you. Would not surprise me if they are charging a custody fee on top of any fees you are paying for, say, mutual funds held in the 401K and IRA. Many places won't charge a custody or holding fee for these accounts.

2. Back to the question of "trading" vs. "investing":
I've got three parts to my investing mantra
- wide diversification
- low management costs
- little or no trading

Management fees and trading both cost you investment returns. And if you are making money, and you trade, you'll lose some of your investment to capital gains taxes. With inflation (admittedly low right now), you can actually get taxed on gains which do not amount to an actual profit.

Diversification allows you to reduce risk, which somewhat strangely in investment doctrine, includes both below and above market returns.

Vanguard's mutual funds and ETFs fit all three goals.

Vanguard's legal structure is unlike pretty much anyone else's. It's funds are owned by the investors. In addition, its ETFs are a sort of clone of their mutual funds. (I've read about their legal structure, but admit I don't fully understand it.) Vanguard also does a really good job of minimizing the distribution of capital gains to its investors.

You asked about starting small: Vanguard allows you to buy single shares of its ETFs, and does not charge any brokerage commission (on its own ETFs). This is how my then 14 year-old son started investing, with a single share of the Vanguard Total World Stock Index fund. Vanguard charges $3000 minimum to invest in one of its regular index funds.

For things like S&P 500 index funds there are companies like Black Rock which are offering lower fees than Vanguard, as a sort of loss leader. However, once you've invested in a given fund, after a while you are effectively locked in due to capital gains taxes (unless it's via an IRA or 401K). I am more confident that 20 or 30 years from now Vanguard will still be treating customers well than I am with pretty much any other investment company.

One caveat about any mutual fund, which includes ETFs (which are just a type of mutual fund): When you buy into an existing fund you buy into the embedded capital gains in the fund. You can get handed capital gains, on which you have to pay capital gains taxes, even if your investment in the fund hasn't gone up.

To pick an artificial example, let's say you invest $10 in a mutual fund I set up years ago called the Winston ETF. My investment in the fund is also $10, but today it's worth $100. (We are the only two investors, to keep the example simple.) So after your investment the fund has $110 value. Then immediately after you invest I decide to sell everything in the fund. The fund now has a capital gain of $90. The IRS says you own your share of that capital gain, which is $10/$110 (your share of the whole fund) x $90, or $8.18. So you get to pay capital gains taxes on $8.18, and I only have to pay capital gains taxes on $81.82, instead of $90. This is true even though you have had no gain at all on your $10 investment. (Don't look at me. I wouldn't have the tax law work this way.)

Because markets have gone up a lot, pretty much every mutual fund these days has large embedded capital gains. Be aware that they could come back to bite you.

ETFs have some advantages on the capital gains score, as fund managers can use the creation of new ETF shares to minimize realizing capital gains.


And while I haven't said it before, almost no one can beat the market. There are a handful of professional investment managers who have done so over most of a lifetime. But there is no way to know who they will be in advance. If you look at scorecards of professional money managers who have done well over the last 5 or 10 years, then track them over the next 5 years, most will have dropped out of the top rankings. By 10 years out, all of them will have dropped out of the top rankings. In the meantime, they've cost investors money in management fees, trading costs, and capital gains taxes.

Diversify. Do so with low costs. Buy and hold.


Now, if you like gambling, and are happy to take a few bucks and invest for entertainment purposes, please do so. But please don't do this with the bulk of your savings.


Good luck.

- Winston



------------------------
Be seeing you.



Edited 2 time(s). Last edit at 01/11/2018 08:36PM by Winston.
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Re: Want to start trading online... any suggestions on which service to use?
Posted by: Winston
Date: January 11, 2018 08:33PM
ps: One other thought: There is a raft of companies like Wealthfront and Betterment, unfortunately nicknamed "robo-advisors" which use automated methods to put people into a variety of ETFs. If these companies were putting people into individual stocks, and then charging next to nothing while the stocks sat in an account, I'd like what they are doing. But I think most people have a much longer investment horizon than they think they do. The only advantage of a robo-advisor is theoretically to manage the "life-cycle" of investing, with the idea that you would want a different mix at age 25 than at age 65. There is some truth to this, but I think you can get almost everything robo-advisors do just by picking a couple or three broad stock index funds and sticking with those.

Also, pretty much every investment company, including Vanguard, has upped its advice game to compete with places like Wealthfront and Betterment, and many now offer similar services if that's what you want.

In my view, the only reason to pay an investment advisor is for handholding. That's a GOOD reason to pay for help. But don't do it to beat the market.


- W



------------------------
Be seeing you.
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