While there are plenty of things to look out for when it comes to choosing an online broker, one of the main ones is fees. There are regular fees and occasionally hidden fees that you might want to know about before you make any plans to work with one.
Most online brokers make their fees known to you before you get started. However, it is very easy to overlook some of them. In this article, we’ll look at some of the more common online broker fees that you may need to watch out for. Take a look!
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Most online brokers require a minimum amount for the first deposit you include. Typically, the minimum deposit is somewhere around $1000. However, should your funds be limited, there are certain online brokers that have minimums as low as $250. Choose your online broker based on how much funding you have available.
Some online brokers also charge an annual or monthly maintenance fee. This is most common in brokers that are taking trades for you that are long-term or that are more hands-on with your trades in general.
One other reason for a maintenance fee is for those brokers who send you physical documents. You can avoid this by setting that up electronically instead.
Higher Interest Rates for Small Trades
It is quite common practice for online brokers to charge a higher rate of interest on a small trade as opposed to a large trade. That being said, make sure that you are not spending more than you can handle just to avoid the interest.
Try your best to find a healthy balance whereby you can handle all these fees and rates without needing to borrow money or risk not having enough for your daily needs. It is always wise to have an emergency fund in case these things get out of hand or your trade takes a little longer than expected.
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