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Jun 17, 2005 7:21 pm

        Can someone give me more info on how much trading firms will allow you to do if you have a fee based account that is charged 1%-1.5% a year. For someone who is an active trader commisions which are 1% of your equity can eat up your equity real fast…but what is the limit they set on the amount of trading you can do…50 trades a year, 100 trades? Just curious thanks.

Jun 17, 2005 8:23 pm

You don’t understand what a fee based account is - the fee is a percentage of average assets, not per trade.

Jun 17, 2005 9:04 pm

I understand exactly what it is. But I’m wondering what is the limit of the amount of trades you can make in a year and only pay 1%-1.5% of your assets with the fee based plan. I know there is some sort of limit but don’t know what that is. Because if you trade with commissions at whatever rate it is (1%-2%) they will eat up any profits you have…

Jun 17, 2005 9:54 pm

I think that the amount of trading activity is set by the RIA when you open up your account with him/her.  Even though it is a flat fee for assets under management, you will find that most RIAs or fee advisors will also pass on their ticket costs.  Those are the costs that the broker dealer or trading venue charges the advisor.  So even if you are paying a flat fee, you will also see some minor charges per trade.  The advisor also doesn't want to have you trading like a madman and eating up any profits they may have as well.

Jun 17, 2005 11:50 pm

ML is 200 trades per year.

Jun 18, 2005 9:55 pm

Good third party platforms have their standard Portfolio Strategists you can use and  not pay ticket charges etc, outside the 1-1.5 you mention.

Now your B/D will be indifferent demanding their 1lb of flesh. Why they may even be charging you a stud fee just for the pleasure of knowing them. I guess their wanting us to adopt their mantra "never charge more than once unless you can get away with it".