Broker trading commissions are the main transaction costs that exist when investing in the stock market. As we have already seen, the transaction costs in investing in the stock market are much lower than in other types of investments. However, it is important to analyze the rates of the brokers to know which is the best for us to reduce them and maximize the profitability of our savings.
In this article we will analyze the types of stock commissions that exist in the market and a tip to reduce their amount in order to increase the profitability of our investments.
Purchase and sale commissions
It is the paradigmatic example of stock commissions. They are what our broker charges each time a stock exchange purchase or sale operation is carried out. This commission depends on the broker fees, being usual that a percentage of the amount of the sale is charged and that there is a minimum commission per operation.
For example, the ING Direct orange broker purchase commission is 0,25% of the total operation, with a minimum of € 12 for operations in the Spanish market.
Unlike what happens with the rest of types of commissions, there are always sales commissions regardless of our financial intermediary. This is because the companies in charge of managing the stock markets always charge a commission to the brokers for each operation.
Maintenance or custody fees
They are what the broker charges for the deposit of the shares. It can be a fixed fee, although it is usually a variable fee that corresponds to a percentage of the size of the portfolio.
In my opinion, as currently the shares should not be guarded as they consist of electronic records, these commissions should not exist. Although it is still very common among brokers to charge a maintenance or custody commission, some do not charge it. For this reason, it is highly recommended to look for brokers that lack custody fees for investors who make few investments and invest long-term.
Other types of stock commissions
The following types of trading commissions tend to have less weight within the expenses incurred by brokers. The ideal would be to find financial intermediaries that do not have this type of commissions. However, although they tend to disappear, many of the most used brokers continue to have these types of commissions.
- Commission for collecting dividends: This is the commission charged by the broker for each time a company pays us dividends.
- Commissions for capital increases: It is the one charged by the broker for attending a capital increase of a company of which we are shareholders.
- Commissions for splits: It is the stock exchange commission that is charged as a result of Bróker Naranja de ING Direct and Self Bank.
At the moment, I continue to use ING for my investments, as it is the most suitable of those that I have analyzed for a long-term investment with few operations. In future articles I promise to continue analyzing more online brokers so that you can choose the one that suits you best and keep commissions at bay.