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How to open a brokerage account?

Open a brokerage account


Choosing a brokerage house is not as easy as the process of setting up an account at a brokerage house. The attractiveness of a particular brokerage house is influenced by various factors. Some of them are purely financial. Others are completely subjective.

It is therefore worth to read this article, which should brighten you some of what you should direct when choosing a brokerage house.

Costs of setting up and running a brokerage account


In most banks, setting up an account is free, while maintaining an account is mostly paid by brokerage houses. If you turn a significant amount of money then this is not a problem.

The trouble is when you are a "small" and a novice investor who just wants to learn the stock market and invest relatively small amounts. Then it is best to use the services of brokerage houses, which offer in addition to free account opening also free of charge.

Commission and brokerage account


The full document that the future investor needs to know is the commission table. Typically, commissions on the purchase of shares are at the level of 0.39% with the assumption that the least commission is for example $ 5. Therefore, it is not worth turning the $ 500 amount, as you will pay a higher commission percentage than 0.39%. Frequent buying and selling for low amounts ends with the majority clearing your account to zero (mainly with commissions).

Interest on free funds in a brokerage account


Does the account offer free interest on your account?

Investing in derivatives


Under what conditions does a given brokerage house offer the opportunity to invest in derivatives (what is the minimum margin or minimum portfolio value)?

Availability of loans on a brokerage account


Does a brokerage house mediate in obtaining a loan to purchase securities on a primary or secondary market (credit line)?

Where is the brokerage house?


It is worth to choose an brokerage house that is close enough to the place where we live. Even if we choose to place orders via the Internet or the phone, it is not advisable to choose a far-off brokerage house. Nobody wants to go 100 km to sign any document.

IT system on brokerage account


Access to the IT services of your brokerage house and the ease of placing an order online.

And moreover:

Deferment of payment. Is it possible to postpone payment? If it is under what conditions does the service operate?

Brokerage recommendations. What conditions do you have to meet to get brokerage recommendations?

Order execution speed. How quickly are our orders processed? Sometimes even a few seconds delay can be murderous for us.

Foreign markets. Is it possible to invest on foreign exchanges?

Other branches of the brokerage house. Is it possible to use another branch of a brokerage house (useful when traveling frequently)?

Transactional system. What trading system does the company offer?

Additional software. Do they offer specialized technical analysis software?

Daytrading. What are the conditions of the office that offer daytrader (people who buy and sell the property during one session)?

It took a while to get it. It is worthwhile to spend some time choosing a brokerage house to take time to not regret later. Well, I do not think I need to remind you that you NEVER READ ALL SIGNATURES BEFORE SIGNING (INCLUDING THE RULES OF THE MAKLER HOUSE).

The Internet is full of comparing brokerage accounts under certain criteria. Every reputable brokerage house has its own web site, where you can read about the offer of a brokerage house. For beginner investors, the most important information will be the cost of setting up and running a brokerage account, commission fees, the quality of the transaction system and the distance of the brokerage house residence from the place of residence.

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