Fees involved when buying and selling shares

[ammatahudu]

Can someone "list" all the fees that could be expected when buying or selling shares?

 

[pixel]

If you are an Australian Resident, all you have to pay is Brokerage, which includes a GST component.
Brokerage is usually a set percentage of the trade value, with a minimum amount for trade values below a certain threshold - usually around the $20,000 cut-off.
If you intend to become a "serious" trader, you'll be well advised to also subscribe to some market data - either end-of-day (required at a minimum), or live data (preferably with share-specific fundamental data, plus history and charting).
You will need to research the various brokers and their offers.

 

[ammatahudu]

Thanks so much. Yes, I am an Australian citizen in fact. So every trade that happens- there is a brokerage fee to be paid. Let's say for example I buy 10k worth shares today and sell all of them tomorrow for 10500 dollars.what is an estimated fee I will pay buying as well as selling.

 

[Indoril]

Thanks so much. Yes, I am an Australian citizen in fact. So every trade that happens- there is a brokerage fee to be paid. Let's say for example I buy 10k worth shares today and sell all of them tomorrow for 10500 dollars.what is an estimated fee I will pay buying as well as selling.

This really depends on which broker you choose. For example, CMC Markets charge $11/trade, Interactive Brokers charge $6/trade and ETRADE charge $19.95/trade. These are all minimums and go up depending on volume. This information is usually found on the broker's website.

 

[ammatahudu]

For sake of calculation let's assume I am with CMC markets. Ok then can you workout for the scenario I gave in my previous message.

 

[pixel]

For sake of calculation let's assume I am with CMC markets. Ok then can you workout for the scenario I gave in my previous message.

You can work it out yourself:
Look up the rate at which CMC brokerage is calculated. Let's assume it's 0.1% with a minimum $15. Then you'll be charged $15 each way, meaning your trade will give you $500 - 2 * $15 profit, or $470.

 

[ammatahudu]

You can work it out yourself:
Look up the rate at which CMC brokerage is calculated. Let's assume it's 0.1% with a minimum $15. Then you'll be charged $15 each way, meaning your trade will give you $500 - 2 * $15 profit, or $470.

Thanks pixel. so is that ALL the charges/fees that I will be expecting

 

[Indoril]

Thanks pixel. so is that ALL the charges/fees that I will be expecting

From the broker, yes. The only other thing to think about is market data fees. Most brokers provide free delayed data but you will usually need to pay for live data.

 

[ammatahudu]

From the broker, yes. The only other thing to think about is market data fees. Most brokers provide free delayed data but you will usually need to pay for live data.

Is live data a requirement if I am planning to trading online? and when you say delayed data- how much delayed is it?

 

[pixel]

Is live data a requirement if I am planning to trading online? and when you say delayed data- how much delayed is it?

only one example:
https://app.incrediblecharts.com/private/analysis/mi/remote_pages/shopcart.php

 

[cutz]

Is live data a requirement if I am planning to trading online? and when you say delayed data- how much delayed is it?

Live data is a requirement when buying and selling shares, most brokers will give you free live data, if it's not the case with your current broker, change brokers.

 

[DancingQuokka]

The bid-ask spread is not a 'fee', but is often the biggest cost, particularly in low volume shares.

 

[pixel]

The bid-ask spread is not a 'fee', but is often the biggest cost, particularly in low volume shares.

True when you buy and sell "at Market"
but even with (free) end-of-day data only, you can place your orders based on support and resistance; that makes the determination of limits for "at Limit" orders much easier even without seeing market depth updated in real-time.

Mind you, as a full-time Intraday trader, I'm not advocating eod trading for everyone; but casual investors with a day job can do it quite easily. Pick the right stocks to hold through trends measured over weeks or months, making 2 or 3 trades a month, and you never have to look at a live chart or m/depth. Checking the eod chart after hours, or the usual 20-minute delayed chart during the day, and you can detect all but the most abrupt trend changes in time.

 

[aus_trader]

Yes, I agree with pixel above, I reckon you don't have to pay for live data (this is data that is streaming live in front of your screen), unless you are trading in and out of positions within the same day. I usually buy shares for which I keep a journal here (see "medium/longer term stock portfolio"), with the intention to hold them for weeks, months or years , and the free 20min delayed data is good enough for me. So in terms of fees, find the best broker that suits you in terms of their services and brokerage fees.

 

[dj_420]

True when you buy and sell "at Market"
but even with (free) end-of-day data only, you can place your orders based on support and resistance; that makes the determination of limits for "at Limit" orders much easier even without seeing market depth updated in real-time.

Mind you, as a full-time Intraday trader, I'm not advocating eod trading for everyone; but casual investors with a day job can do it quite easily. Pick the right stocks to hold through trends measured over weeks or months, making 2 or 3 trades a month, and you never have to look at a live chart or m/depth. Checking the eod chart after hours, or the usual 20-minute delayed chart during the day, and you can detect all but the most abrupt trend changes in time.

I agree with this but there are limitations to the free data.

I was using free data from Yahoo and Google downloaders and recently have noticed a lot of errors in the datasets. A lot of apparent fat finger spikes, incorrect volumes and daily trading ranges. All of which are cleaned up and error free in the data subscription I currently have.

IMO a decent EOD data subscription is worth the cost. I can do all my analysis using an EOD data package in Metastock/Quantshare and then place orders using the Interactive platform and trade 'blind'. I have an old Commsec account which is live so can get an idea of order flow and depth.

I could potentially use the Interactive data subscription but want to have the ability for hard coded screens and backtesting ability and Commsec fees are ridiculous.

Probably worth adding that this is fine for swing or medium term trading, but intraday you obviously need the short term live data.

For people who are casual investors you could open a Commsec/Westpac/ANZ account, have the live data for order flow and depth and just place trades through a cheaper broker.

 

[aus_trader]

I agree with this to a point.

I was using free data from Yahoo and Google downloaders and recently have noticed a lot of errors in the datasets. A lot of apparent fat finger spikes, incorrect volumes and daily trading ranges.

IMO a decent EOD data subscription is worth the cost. I can do all my analysis using an EOD data package in Metastock/Quantshare and then place orders using the Interactive platform and trade 'blind'. I have an old Commsec account so can get an idea of order flow and depth.

I could potentially use the Interactive data subscription but want to have the ability for hard coded screens and backtesting ability and Commsec fees are ridiculous.

Back in the day when I first started buying my first share on the asx, there was hardly any competition and my Commsec account was charging about $29.95 per trade. So I was approx $60 bucks down before the position made a cent! Fees have come down thanks to many brokerage companies offering competitive fees. Thank god for that