Friday, February 10, 2006


There's a lot of debate out there about what a brokerage house offers clients and how much it costs. There's an article here that kind of compares "full service" brokers against the "discount" brokers.

You've seen the Waking Life-looking commercial with the guy that says that you either get charged up the ying yang or you get a "website, and a good luck wish."

The thing is, there are incredible conflicts of interest at work here when a broker recommends or gives advice. Plus, historically, money managers can't even beat the S&P 500. So why bother?

Well, it makes us feel better about giving our money out. Like we are being more responsible.

I say go to Scottrade (which is curiously not mentioned in the above article) and trade with them. They won't give you any advice, but it's cheap and there are no hidden fees ($7 a trade). I tried to find out if they sold a certain type of fund and they replied that they couldn't answer that because it would be tantamount to endorsing it.

Which was weird but OK, for $7, I understand.

The thing is, this is for the do-it-yourselfer. Learn about what you're doing, the basics anyway, and you can make your money grow over the long term with very little risk.

You can even open IRAs and such.

It's really the best place to go if you are willing to learn on your own before jumping into new things (which is what you should do instead of relying on someone who just wants your money to do it for you).

Scottrade, I salute you.


Post a Comment

<< Home