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March 09, 2007
There's more to choosing a broker than commissions
I have a short piece in this week's BW magazine comparing the no-commisssion trading offers of Bank of America, Wells Fargo and Zecco.com. It's important to emphasize that stock trading commissions are just one part of the "cost" of doing business with a broker along with other transaction fees, minimum balance requirements and so forth. And while it's hard to put an exact dollar value on other features, like research reports or data analysis tools, they should also factor into your decision.
In the end, I don't think free stock trading alone is enough to warrant opening an account with any of these three firms as, I suspect, all three would agree. If you already do a lot of banking with BofA or Wells, their free-trade offers become a lot more appealing. Zecco looks best suited for those who are already spending money on research and analytics beyond what online brokers provide and so place little value on the bells and whistles that those other firms may offer.
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