best way to buy individual stocks

[steviesterno]

Hey all,

I'm looking for the best way to buy individual company stocks. I know it's not the best long term, but I'm looking to mix it up and put a couple dollars into a gamble. I already have my retirement stuff automated into index funds and low cost accounts, but wondering what's the cheapest/easiest way to buy a low number of shares in individual companies? I think it would be fun to watch and guess as my "real" accounts do the quiet growing off the sidelines.

Thanks!
 

[Static Void]

At some point one of my employers created me an e*trade account which I still have. It's easy to point and click to buy/sell shares. I think the transaction fee is currently $10.

[jim555]

Some discount brokers have no commission ETFs, usually with the condition you hold them for 30 days. 

[Vilgan]

If buying a small amount and free commissions would be valuable, you might take a look at: https://www.robinhood.com/

I haven't used it but the no commissions seems nifty.

[rantk81]

I use InteractiveBrokers, which charges really really low commissions on trades, but the software platform can be quite overwhelming to people who aren't familiar with trading.  If you aren't familiar with trading, then I don't recommend their platform.  There are many more user-friendly brokers, but they all charge higher commissions and fees.

[solon]

Definitely robinhood. I've been using it for almost a year. It's easy, and doesn't charge any commissions or fees. Would appreciate a referral, too: http://share.robinhood.com/brianw

The only downside is it's only available on smart phones. They don't have a web interface.

[Davids]

I have a scottrade account, it represents a very small part of my overall portfolio but i look at that piece as fun money.

[Spork]

If you have a vanguard account, trades are either inexpensive or free (depending on your balance and how many trades you do).

https://personal.vanguard.com/us/whatweoffer/stocksbondscds/feescommissions

[seattlecyclone]

There are a ton of brokers that offer trades in the $7-10 range, not many that go much lower than this as a standard rate for individual stock trades. Robinhood and Interactive Brokers are good options if you want to go lower.

Like Spork said, you can sometimes find deals depending on your existing net worth and where it is. Many brokers will give out some free or discounted trades to their higher net worth clients.

[steviesterno]

If you have a vanguard account, trades are either inexpensive or free (depending on your balance and how many trades you do).

https://personal.vanguard.com/us/whatweoffer/stocksbondscds/feescommissions

Thanks, I'll have to check that out. I thought vanguard would only let you buy vanguard stuff though? at least how I went through their website.

There are a ton of brokers that offer trades in the $7-10 range, not many that go much lower than this as a standard rate for individual stock trades. Robinhood and Interactive Brokers are good options if you want to go lower.

Like Spork said, you can sometimes find deals depending on your existing net worth and where it is. Many brokers will give out some free or discounted trades to their higher net worth clients.

I'm not high net worth (yet) but working on it. $10 a trade doesn't seem great since I want to be buying like one share at $22 or whatever as I'm screwing around. it's easy for me to mentally do that... If I skip pizza this week I can buy one share of smith and wesson! (or whatever)

[forummm]

If you have a vanguard account, trades are either inexpensive or free (depending on your balance and how many trades you do).

https://personal.vanguard.com/us/whatweoffer/stocksbondscds/feescommissions

Thanks, I'll have to check that out. I thought vanguard would only let you buy vanguard stuff though? at least how I went through their website.

There are a ton of brokers that offer trades in the $7-10 range, not many that go much lower than this as a standard rate for individual stock trades. Robinhood and Interactive Brokers are good options if you want to go lower.

Like Spork said, you can sometimes find deals depending on your existing net worth and where it is. Many brokers will give out some free or discounted trades to their higher net worth clients.

I'm not high net worth (yet) but working on it. $10 a trade doesn't seem great since I want to be buying like one share at $22 or whatever as I'm screwing around. it's easy for me to mentally do that... If I skip pizza this week I can buy one share of smith and wesson! (or whatever)

Vanguard isn't that cheap for individual stock trades. It's something like $20/trade. If you have a lot of money in VG funds (like $500k) it's cheaper. I think if you have over $1M you get a bunch of free trades. But trading Vanguard ETFs in a Vanguard account is always free.

Individual stock buying is not a good financial strategy if you are only buying 1 share. The transaction costs are such a huge percent of your trade. But if you had a Vanguard account you could buy one share of an ETF for free (skipping pizza to buy a share of VWO for $34).

[Spork]

If you have a vanguard account, trades are either inexpensive or free (depending on your balance and how many trades you do).

https://personal.vanguard.com/us/whatweoffer/stocksbondscds/feescommissions

Thanks, I'll have to check that out. I thought vanguard would only let you buy vanguard stuff though? at least how I went through their website.

There are a ton of brokers that offer trades in the $7-10 range, not many that go much lower than this as a standard rate for individual stock trades. Robinhood and Interactive Brokers are good options if you want to go lower.

Like Spork said, you can sometimes find deals depending on your existing net worth and where it is. Many brokers will give out some free or discounted trades to their higher net worth clients.

I'm not high net worth (yet) but working on it. $10 a trade doesn't seem great since I want to be buying like one share at $22 or whatever as I'm screwing around. it's easy for me to mentally do that... If I skip pizza this week I can buy one share of smith and wesson! (or whatever)

Vanguard isn't that cheap for individual stock trades. It's something like $20/trade. If you have a lot of money in VG funds (like $500k) it's cheaper. I think if you have over $1M you get a bunch of free trades. But trading Vanguard ETFs in a Vanguard account is always free.

Individual stock buying is not a good financial strategy if you are only buying 1 share. The transaction costs are such a huge percent of your trade. But if you had a Vanguard account you could buy one share of an ETF for free (skipping pizza to buy a share of VWO for $34).

Click the link!  ;)

Less than $50k in your account, the first 25 trades are $7 each.  It goes up to $20 if you do more than that (but those of us that buy individual stocks "for fun" while mostly investing in index funds don't do a lot of trades.)

Prices drop as your account balance goes up.

[solon]

Individual stock buying is not a good financial strategy if you are only buying 1 share. The transaction costs are such a huge percent of your trade.

All trades on robinhood are free! Zero commission. Even if you only buy one share. Perfect for the pizza/no pizza decision.

[seattlecyclone]

If you have a vanguard account, trades are either inexpensive or free (depending on your balance and how many trades you do).

https://personal.vanguard.com/us/whatweoffer/stocksbondscds/feescommissions

Thanks, I'll have to check that out. I thought vanguard would only let you buy vanguard stuff though? at least how I went through their website.

Nope, you can buy whatever stocks you want through Vanguard. The commission discounts are based on the amount you have in Vanguard funds, not your total balance.

[Jack]

Definitely robinhood. I've been using it for almost a year. It's easy, and doesn't charge any commissions or fees. Would appreciate a referral, too: http://share.robinhood.com/brianw

The only downside is it's only available on smart phones. They don't have a web interface.

All trades on robinhood are free! Zero commission. Even if you only buy one share. Perfect for the pizza/no pizza decision.

It sounds too good to be true. What's the catch? How do they [plan to] make profit? How do I know my shares held by them won't vanish into the ether one day (or at least become a huge pain in the ass to transfer to another brokerage) when they go bankrupt?

[solon]

Definitely robinhood. I've been using it for almost a year. It's easy, and doesn't charge any commissions or fees. Would appreciate a referral, too: http://share.robinhood.com/brianw

The only downside is it's only available on smart phones. They don't have a web interface.

All trades on robinhood are free! Zero commission. Even if you only buy one share. Perfect for the pizza/no pizza decision.

It sounds too good to be true. What's the catch? How do they [plan to] make profit? How do I know my shares held by them won't vanish into the ether one day (or at least become a huge pain in the ass to transfer to another brokerage) when they go bankrupt?

Here's what they say in the FAQ (https://support.robinhood.com/hc/en-us/articles/202853769-How-Robinhood-Makes-Money):

Robinhood makes money in many of the same ways as traditional online brokerages. These include:

- Collecting interest from customers who choose to upgrade to a margin account. We are testing margin in beta and will offer margin accounts later this year.

- Accruing interest from customers’ uninvested cash balances. It is important to note that our customers are not charged.

Robinhood has raised $66 million from NEA, Index Ventures, Ribbit Capital, Vaizra Investments, Google Ventures, Andreessen Horowitz, Social Leverage, Box CEO Aaron Levie, Path CEO Dave Morin, Jared Leto, Snoop Dogg, Linkin Park, and Nas, which gives us the freedom to focus on building an outstanding experience rather than short-term profits.

[Monkey Uncle]

If you have a vanguard account, trades are either inexpensive or free (depending on your balance and how many trades you do).

https://personal.vanguard.com/us/whatweoffer/stocksbondscds/feescommissions

Thanks, I'll have to check that out. I thought vanguard would only let you buy vanguard stuff though? at least how I went through their website.

There are a ton of brokers that offer trades in the $7-10 range, not many that go much lower than this as a standard rate for individual stock trades. Robinhood and Interactive Brokers are good options if you want to go lower.

Like Spork said, you can sometimes find deals depending on your existing net worth and where it is. Many brokers will give out some free or discounted trades to their higher net worth clients.

I'm not high net worth (yet) but working on it. $10 a trade doesn't seem great since I want to be buying like one share at $22 or whatever as I'm screwing around. it's easy for me to mentally do that... If I skip pizza this week I can buy one share of smith and wesson! (or whatever)

Sounds like you truly are just playing around with something that will have no impact on your portfolio.  Why not just paper trade?  Then you can imagine you're buying round lots and you won't have a problem with an imaginary $10 commission.  It will have about the same effect on you net worth.

[Spork]

If you have a vanguard account, trades are either inexpensive or free (depending on your balance and how many trades you do).

https://personal.vanguard.com/us/whatweoffer/stocksbondscds/feescommissions

Thanks, I'll have to check that out. I thought vanguard would only let you buy vanguard stuff though? at least how I went through their website.

There are a ton of brokers that offer trades in the $7-10 range, not many that go much lower than this as a standard rate for individual stock trades. Robinhood and Interactive Brokers are good options if you want to go lower.

Like Spork said, you can sometimes find deals depending on your existing net worth and where it is. Many brokers will give out some free or discounted trades to their higher net worth clients.

I'm not high net worth (yet) but working on it. $10 a trade doesn't seem great since I want to be buying like one share at $22 or whatever as I'm screwing around. it's easy for me to mentally do that... If I skip pizza this week I can buy one share of smith and wesson! (or whatever)

Sounds like you truly are just playing around with something that will have no impact on your portfolio.  Why not just paper trade?  Then you can imagine you're buying round lots and you won't have a problem with an imaginary $10 commission.  It will have about the same effect on you net worth.

I'm not the OP here... but I'll say: not necessarily.

Over the last 18 years, my trade account has an IRR of about 7.9%.
Over the same period, my vanguard account has an IRR of 6.4%

The trade account is about 10% of the value of the vanguard account, but is actually a pretty significant amount of money.  It does have some effect on net worth.

Now: the reason it is only 10% is because I am smart enough to realize a whole lot of that extra return is just dumb luck.  It could just as easily have been the other way around (or worse).

[BTDretire]

I have a scottrade account, it represents a very small part of my overall portfolio but i look at that piece as fun money.

 I also have a Scottrade account that I considered fun money.
The problem is it got bigger and is kind of serious now.
 Holding 12 stocks  REITs, a bank, phone Co, and a paper Co.
 $7 a trade, easy to maneuver around to see what you have.

[DividendMonster]

Ditch the various funds and make your own dividend growth portfolio with all the best companies of your choosing... assuming you know how to pick the winners ;).

[Frugalbeach]

Sharebuilder, which is now called Capital One Investing, offers $6.95 online trades.  We used this for our son when we first got him interested in stocks.  Great fun teaching hiim the basics of stock investing.  He's actually done quite well!

They also offer a bonus based on how much you start your account with ($50 bonus with $5000 account and on up).

[nick123]

Try Firstrade. I have used them for a while. None of the usual BS inactivity fees or minimum balances. Commissions are $6.95 per trade. I transitioned from Scottrade to them years ago. Robbinhood has my attention though. I'm checking them out.

[Monkey Uncle]

If you have a vanguard account, trades are either inexpensive or free (depending on your balance and how many trades you do).

https://personal.vanguard.com/us/whatweoffer/stocksbondscds/feescommissions

Thanks, I'll have to check that out. I thought vanguard would only let you buy vanguard stuff though? at least how I went through their website.

There are a ton of brokers that offer trades in the $7-10 range, not many that go much lower than this as a standard rate for individual stock trades. Robinhood and Interactive Brokers are good options if you want to go lower.

Like Spork said, you can sometimes find deals depending on your existing net worth and where it is. Many brokers will give out some free or discounted trades to their higher net worth clients.

I'm not high net worth (yet) but working on it. $10 a trade doesn't seem great since I want to be buying like one share at $22 or whatever as I'm screwing around. it's easy for me to mentally do that... If I skip pizza this week I can buy one share of smith and wesson! (or whatever)

Sounds like you truly are just playing around with something that will have no impact on your portfolio.  Why not just paper trade?  Then you can imagine you're buying round lots and you won't have a problem with an imaginary $10 commission.  It will have about the same effect on you net worth.

I'm not the OP here... but I'll say: not necessarily.

Over the last 18 years, my trade account has an IRR of about 7.9%.
Over the same period, my vanguard account has an IRR of 6.4%

The trade account is about 10% of the value of the vanguard account, but is actually a pretty significant amount of money.  It does have some effect on net worth.

Now: the reason it is only 10% is because I am smart enough to realize a whole lot of that extra return is just dumb luck.  It could just as easily have been the other way around (or worse).

I don't recall the OP saying how big his (or her?) fun-money stake is, but if he's talking about buying one share at a time, I presume it is pretty small.  I can't imagine a scenario under which that is an efficient or effective way to invest.  My point is that he would be better off just pretend-trading until he has enough money to take real positions that aren't seriously impacted by the commissions.

[theSlowTurtle]

TradeKing has $4.95 trades and you can get a free $100 if you click the sponsored links on Radical Personal Finance https://radicalpersonalfinance.com/275-selecting-brokerage-company-stock-ownership-trading-intro-new-sponsor-tradeking/

[Spork]

If you have a vanguard account, trades are either inexpensive or free (depending on your balance and how many trades you do).

https://personal.vanguard.com/us/whatweoffer/stocksbondscds/feescommissions

Thanks, I'll have to check that out. I thought vanguard would only let you buy vanguard stuff though? at least how I went through their website.

There are a ton of brokers that offer trades in the $7-10 range, not many that go much lower than this as a standard rate for individual stock trades. Robinhood and Interactive Brokers are good options if you want to go lower.

Like Spork said, you can sometimes find deals depending on your existing net worth and where it is. Many brokers will give out some free or discounted trades to their higher net worth clients.

I'm not high net worth (yet) but working on it. $10 a trade doesn't seem great since I want to be buying like one share at $22 or whatever as I'm screwing around. it's easy for me to mentally do that... If I skip pizza this week I can buy one share of smith and wesson! (or whatever)

Sounds like you truly are just playing around with something that will have no impact on your portfolio.  Why not just paper trade?  Then you can imagine you're buying round lots and you won't have a problem with an imaginary $10 commission.  It will have about the same effect on you net worth.

I'm not the OP here... but I'll say: not necessarily.

Over the last 18 years, my trade account has an IRR of about 7.9%.
Over the same period, my vanguard account has an IRR of 6.4%

The trade account is about 10% of the value of the vanguard account, but is actually a pretty significant amount of money.  It does have some effect on net worth.

Now: the reason it is only 10% is because I am smart enough to realize a whole lot of that extra return is just dumb luck.  It could just as easily have been the other way around (or worse).

I don't recall the OP saying how big his (or her?) fun-money stake is, but if he's talking about buying one share at a time, I presume it is pretty small.  I can't imagine a scenario under which that is an efficient or effective way to invest.  My point is that he would be better off just pretend-trading until he has enough money to take real positions that aren't seriously impacted by the commissions.

OH!  I absolutely blew past that whole one share thing.  Yeah, okay, you're totally right.  Unless we're talking Berkshire/Hathaway or equivalent. ;)

I was stuck on the original "low number of shares" thing...  I'd consider 100 shares to be a low number.  I don't personally make any buy that isn't a few thousand dollars worth.

[Paul der Krake]

Fidelity will give you a few free trades if you ask nicely. They gave me 10 when I had about 50k with them. Still haven't used them all.

Some companies also have direct purchase plans with zero or near-zero fees.

[BigRed]

Sharebuilder, which is now called Capital One Investing, offers $6.95 online trades.  We used this for our son when we first got him interested in stocks.  Great fun teaching hiim the basics of stock investing.  He's actually done quite well!

They also offer a bonus based on how much you start your account with ($50 bonus with $5000 account and on up).

I'm about to start the same thing for our sons as well so they can learn about the market by following an individual stock.  It'll be for less than $5000, though, that's for sure.  Did you open a UTMA/UGMA account for him?

[Jack]

I've got a Sharebuilder account now (in part to get the account opening bonus, which at the time worked out to something like a 2% annual return by itself). I'm in this thread hoping to find an alternative even cheaper than that (and seriously considering Robinhood).

[steviesterno]

saw a commercial for scotttrade to get 50 free trades. only good if you put like 20k in the account.

I was really thinking a couple hundred dollars to start, nothing crazy. I wanted something cheap to throw money into when I end up with an extra $20-40 however.

looking like it's not really worth it at this point, but thanks for the help!

[Grigory]

Personally, I use TradeKing, which is a basic discount broker with fairly good customer service and easy interface. They charge only $4.95 per trade, have no hidden fees, and have a bunch of different specials for brand new clients.

A word of warning, though: if all you really have is just "a couple hundred dollars," the transaction fees will eat up a lot of your profit. If you invest $500, it'll cost you $10 to buy and sell that stock, and that's 2% of your capital right there. :(

[mrpercentage]

2 ways:

1. Robinhood-- downside is taxable only
2. Direct Stock Purchases-- go to companies site-- to investors-- look for direct stock purchase program-- downside is high termination or selling fees. Low to zero buy fee. They are meant to build a large position over time in small amounts.

https://www.shareowneronline.com/UserManagement/WFIndex.aspx

https://www-us.computershare.com/Investor/3x/Plans/PlansList.asp?bhjs=1&fla=1&cc=us&lang=en

[BrianBull]

My reason for wanting to buy an individual stock share is for my Kid's investment education. One stock of their choosing (favorite toy manufacturer e.g.) that they can see and feel while watching the price as it bounces over the years. I would be interested in any feedback on this.

[Spork]

My reason for wanting to buy an individual stock share is for my Kid's investment education. One stock of their choosing (favorite toy manufacturer e.g.) that they can see and feel while watching the price as it bounces over the years. I would be interested in any feedback on this.

Unfortunately, though, this really isn't the way to buy stock. 

In my own experience "companies I like" was a terrible way to invest.  I would buy stock because I believed in a company's product or liked the way they do business.  Unfortunately, that isn't necessarily the stock that does great in the long term.

[solon]

My reason for wanting to buy an individual stock share is for my Kid's investment education. One stock of their choosing (favorite toy manufacturer e.g.) that they can see and feel while watching the price as it bounces over the years. I would be interested in any feedback on this.

Unfortunately, though, this really isn't the way to buy stock. 

In my own experience "companies I like" was a terrible way to invest.  I would buy stock because I believed in a company's product or liked the way they do business.  Unfortunately, that isn't necessarily the stock that does great in the long term.

It's a great way to get your kids interested in investing, though. Buy each kid one share of something they know and love, like Coca Cola, or Disney, or something like that. That way they feel a sense of ownership and become interested in news or price movements, etc.

[beltim]

My reason for wanting to buy an individual stock share is for my Kid's investment education. One stock of their choosing (favorite toy manufacturer e.g.) that they can see and feel while watching the price as it bounces over the years. I would be interested in any feedback on this.

Unfortunately, though, this really isn't the way to buy stock. 

In my own experience "companies I like" was a terrible way to invest.  I would buy stock because I believed in a company's product or liked the way they do business.  Unfortunately, that isn't necessarily the stock that does great in the long term.

It's a great way to get your kids interested in investing, though. Buy each kid one share of something they know and love, like Coca Cola, or Disney, or something like that. That way they feel a sense of ownership and become interested in news or price movements, etc.

Yes.  It's much easier for kids to understand how the stock market works with individual shares rather than an index, and it helps avoid a lot of common misunderstandings about the stock market (like if you make a profit, someone else makes a loss; or that there's any sort of direct relationship between the growth of the "economy" and an investment return).  Plus, it's a lot more fun.

[doggyfizzle]

I've got a PMA account with Wells Fargo that grants me 100 commission-free trades per year.  I've seen ads for Merrill Edge that advertise something similar if you maintain a certain relationship balance with the bank.  I saw that someone mentioned IB, and that is who I would honestly go with if you're looking for bargain-basement pricing without needing a significant amount of money in a brokerage account.

[seattlecyclone]

I've got a PMA account with Wells Fargo that grants me 100 commission-free trades per year.

I have that too, but they haven't offered this perk to new customers for a few years.

[sabertooth3]

I haven't seen Loyal3 on here yet, so I'll plug for them.


Pros

• No fees to buy or sell
• Simple interface
• Have information on IPOs, if you're into that (which you probably aren't if you're reading this here, but I think I should mention it anyway)

Con

• Very small selection of stocks to choose from

The link above is not a referral, so feel free to check it out.