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Thread: Stupid questions : How does Scottrade work?

  1. #31
    also from what i remember

    someone stated you needed to have 2000 balance for a margin account
    this way when you sell a stock the money is available right away


    if you do not have a margin acount you will have to wait 3 days ( i think ) for the money to clear from the sale of the stock


    and from what i remember, call to make sure
    the daytrading rule applys to margin accounts
    if you have a cash account you can trade as much as you want, no daytrading rule
    but will have to wait for money to clear

    but call to make sure i am right

    dan



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  3. #32
    Quote Originally Posted by Josh_LA View Post
    I'm very tempted to do stocks now that we're at 11 year low.

    Here are my Q's

    1. How do you fund your account? (Wire transfer? Credit card?)

    2. Do you fill a tax form upfront and file next year? Or is it withheld?

    3. How do you cash out?

    4. Is it only $7 regardless of buy, sell, how much you trade? No other fees?

    5. Is there any law or rule against trading the same stock back and forth?

    6. Theoretically, if I put in $100, I can put $93 to buy whatever I like, then if it rises 20%, I can sell it for about $111.50, minus $7, $104.50. How soon can I have this money to spend on groceries?

    7. Anything else I should know?

    YES, I know stocks are not the best investment, I'm only investing what I'm planning to lose.

    AH, so you're planning on placing a couple of gambling bets are you?


    I recently (last year) started accounts on both Etrade and Scottrade -- stay away from Etrade (they are a PITA); the Scottrade experience (so far) has been great.

    Regarding the Q's:


    1. How do you fund your account? (Wire transfer? Credit card?)

    Best method (for big amounts) is wire transfer (but your bank will charge a fee for that). Second best method is to add to your account at the local Scottrade office (they have hundreds around the country -- probably one that is fairly close to you, maybe 1/2 hour to hour drive away at the most).

    You *can* link up your checking acount to do a transfer via e-check, but the funds are normally "held" for a few days (exactly why? I am not sure... I know that Etrade "locked-up" my funds for well over a week -- when I started the scottrade acct, I did wire transfer & money was available for trading the next business day).

    2. Do you fill a tax form upfront and file next year? Or is it withheld?

    Pretty much up to you. The documentation that they require is minimal if you just want to do cash trades on a simple (regular) account. If you are doing a self-directed IRA, well expect all kinds of extra paperwork -- if you're doing a rollover, that takes time to coordinate.

    [...]

    7. Anything else I should know?

    Absolutely. NEVER forget that Scottrade has LOCAL offices -- and if you call their main 800 assistance number (during the daytime anyway) you will be forwarded to a REAL HUMAN BEING who works AT YOUR LOCAL OFFICE.

    So far I have found the Scottrade people able to either immediately HAVE an answer to my questions -- OR, they have been upfront and totally honest about "not knowing" but then promise to get back to me ASAP... and (an amazing thing for this day in age) they actually DID get back to me with a solid answer (including a link to relevant documents), in the same afternoon that I asked (liek maybe an hour later).

    Now, maybe I just got lucky with my local office personnel -- and YMMV -- but something tells me there is a really good corporate training program, and (like the old Avis car rental motto -- because they're smaller, they have to work harder to get/keep your business).

    BTW, good luck!



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  5. #33
    Quote Originally Posted by Josh_LA View Post
    just getting ready & feet wet

    More questions :

    1. Can you trade a $30 stock for 2 $15 stocks? Or do you have to sell A, then take your money to buy B?

    2. Is $7 a transaction fee? Or, basically if :

    I want $300 in stock A
    And $200 in stock B
    another $100 in stock C

    Is there a way I can put them all in a shopping cart to pay $7 total at once? Or must they all count as one transaction, thus, $21 for 3 trades?

    3. If Google is $350 a share, can I only buy one share at a time, and not a portion of it if I have less than $350?

    Beware.

    Scottrade is a good RELATIVELY cheap way to make trades, but with such small-dollar transactions (those are REALLY small), the fees will eat up your gains and/or make your losses much more severe.

    It's sort of like getting 5% interest on a checking account, but then having to pay $10 per month in account fees. If you only have $500 in that account, you're going to go backwards -- if you have $100 in it, you're going to go broke by the end of the year.

    To my mind, anyone who has less than $10K worth of "play" money probably shouldn't be mucking around. (And by "play" money, I mean money that is in addition to substantial other savings -- emergency fund, 6 months worth of ALL expenses, other savings that would pay car payments + mortgage + property taxes for next year or two, etc).


    Seriously, otherwise whatever "gains" you might make -- even on ideal stock picks -- can be totally offset by additional "late fees" and other malarkey if your money situation is at all "tight".

  6. #34
    Quote Originally Posted by WRellim View Post
    Beware.

    Scottrade is a good RELATIVELY cheap way to make trades, but with such small-dollar transactions (those are REALLY small), the fees will eat up your gains and/or make your losses much more severe.

    It's sort of like getting 5% interest on a checking account, but then having to pay $10 per month in account fees. If you only have $500 in that account, you're going to go backwards -- if you have $100 in it, you're going to go broke by the end of the year.

    To my mind, anyone who has less than $10K worth of "play" money probably shouldn't be mucking around. (And by "play" money, I mean money that is in addition to substantial other savings -- emergency fund, 6 months worth of ALL expenses, other savings that would pay car payments + mortgage + property taxes for next year or two, etc).


    Seriously, otherwise whatever "gains" you might make -- even on ideal stock picks -- can be totally offset by additional "late fees" and other malarkey if your money situation is at all "tight".
    True, although I think if one just is aiming to learn a thing or two about trading and not necessarily make money, a balance of only 1-2 grand in your brokerage account would be sufficient.

    In addition, if you're short on funds you can just stick to options trading (gambling). If you're options move big into the money whatever fees you paid are almost irrelevant.

  7. #35
    Quote Originally Posted by brandonyates View Post
    True, although I think if one just is aiming to learn a thing or two about trading and not necessarily make money, a balance of only 1-2 grand in your brokerage account would be sufficient.

    In addition, if you're short on funds you can just stick to options trading (gambling). If you're options move big into the money whatever fees you paid are almost irrelevant.

    Just I've been there (recovering from being "nearly broke") and saw others try to use stock market for quick gains from low savings (versus me doing more traditional "saving"); and I got out of being "broke" much quicker and stronger than they did (actually most of them just lost their shirts).

    IMO, "easy money" is a trap for the vast majority of people (regardless of whether it is credit cards, or playing the market) -- they just don't have the "feel" (mindset?); much less the wherewithal to really trade properly (and that goes doubly for the current uber-bear market environment).

    But you ARE right, if the person is just using it as a "learning experience" -- and therefore counting any/all losses as simply a "learning fee". But it can still be an expensive way to learn (and it really BETTER be their "play" money -- it's sad to see kids w/o clothes, shoes or food because daddy wanted to learn about playing the market -- and I've seen cases of THAT in real life).
    Last edited by WRellim; 03-04-2009 at 01:33 PM.

  8. #36
    Quote Originally Posted by WRellim View Post

    But you ARE right, if the person is just using it as a "learning experience" -- and therefore counting any/all losses as simply a "learning fee". ).
    That's me, only investing what I can afford to lose, so when I put in my $500 minimum, I've already told myself "it's gone".

  9. #37
    Quote Originally Posted by WRellim View Post
    1. How do you fund your account? (Wire transfer? Credit card?)

    Best method (for big amounts) is wire transfer (but your bank will charge a fee for that). Second best method is to add to your account at the local Scottrade office (they have hundreds around the country -- probably one that is fairly close to you, maybe 1/2 hour to hour drive away at the most).

    You *can* link up your checking acount to do a transfer via e-check, but the funds are normally "held" for a few days (exactly why? I am not sure... I know that Etrade "locked-up" my funds for well over a week -- when I started the scottrade acct, I did wire transfer & money was available for trading the next business day).
    Most of the basic questions have been answered for you. However, if you do e-check transfers from your checking account, Scottrade no longer ties up the funds. They will instantly credit your account even though they technically haven't gotten the funds from your bank yet. (very nice service)

    Personally, I think unless you have at least 2-3 thousand dollars to trade with, I'd put your money somewhere else. Even $7 fees will eat you alive, plus you really want to have enough money in your account so you can open positions in stages rather than buying all the stock in a certain company at once.

    I've never used it before, but I'm pretty sure www.zecco.com has free trades of all types, however, I think it doesn't have a live ticker. Your ticker is probably 20 minutes behind, whereas Scottrade's screen is tick by tick up to the second.

  10. #38
    Quote Originally Posted by TheState View Post
    You can have unlimited day trades if you have over $25,000 in your account. Otherwise you are limited to 3 daytrades in a rolling 5 business day period. These are ONLY when you buy and sell the same stock the same day. NOT if you sell and re-buy, or just make 10 buys of separate stocks, etc..

    You have unlimited transactions, just 3 daytrades.
    Also, you can only do unlimited day trades if you have over $25,000 in a margin account in particular. If you have a cash account instead, Regulation T technically prohibits you from reselling securities purchased with unsettled funds. (If you sell something, the transaction doesn't technically settle for three business days...you can buy more securities with that money, but you can't sell them again with a cash account until the first sale has cleared three days later. With a margin account, you can sell them immediately, so long as you either follow the day-trading rules or have at least $25,000 capitalization.)

    Of course, in Josh's case, day trading is pretty much an impossibility. $7 transaction fees are very low compared to most brokers, but they're high enough that swing trading is the most frequent kind of trading you can get away with using $500...and that's only if you have exceptional timing ability, to say the least.
    Last edited by Mini-Me; 03-04-2009 at 07:17 PM.

  11. #39
    LibForestPaul
    Member

    Quote Originally Posted by Ethek View Post
    I use ameritrade. It may seem high a 9.99 a trade but there are really 0 fees with the account so no supprises, no limits on trades that I know about. Funding is quick and you can tie in ACH direct to your bank. The iphone app alone is worth the 2$ a trade to me.

    Start an account with $2000 and you get unlimited trades for 30 days. I only ended up using about 20 trades during the time. Should have been up 30% if I trusted the trades and the people I was listening too. I'm up 10% even with the fees.. but just getting involved I've learned tons.

    Also, the phone service at Ameritrade has always been helpful.. but I have had any issues that have been too involved yet.
    Why does TDAmeri have (2 sites). Izone and tdameritrade, differences?

    P.S. Trading on foreign boards?
    Limit Orders?

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