to? I don’t understand why no other online account has

ever had a problem verifying my identity, but Zecco has,

multiple times. Sounds like the French commenter

above had no problems. Beat that! Supplying my info

online was not good enough so they mailed me the

paperwork AND asked me to send in a copy of my

driver’s license. Did that. Trying to hook it up to my 10

year old bank account, which is clearly mine and clearly

based on a verified identity and that’s not good enough

either.

They then ask me to send them a copy of my social

security card. Whaaa? Nobody has ever asked to see

that thing. It’s been in a box so long I’m not even sure

where I put it. That sounds really really odd and makes

me uncomfortable for some reason. I’m going to do it

but I’ve been on the fence about it. Wonder how many

legit people that scares off? Plus you’d think that it’d be

pretty easy to just scan and photoshop yourself a fake

SS card these days if you really wanted to commit fraud,

so it would seem that a scratchy faxed copy of a card

wouldn’t be much more verification than just giving the

number.

If they have such problems with customer service

capacity, maybe it’s because they make so much more

work for themselves and their customers than other

vendors. They’ve got to be drowning in scattered paper.

I guess free trades means you should logically expect

put up with inconveniences you wouldn’t get with other

vendors, but these barriers to entry seem like a

lose-lose situation. I know they want to prevent fraud and

keep security tight, but jeez! I wanted to get in before

the Fed rate cut and foolishly thought I could do it in a

week or so, but it’s been weeks and weeks of baloney

now, opportunity long gone. Sharebuilder was a breeze

to set up, on the other hand. As an infrequent trader I’m

tempted to just stay there and eat the fees and deal with

the weekly purchasing limitation.

16 The IT Guy on October 16, 2007 said:
I’m having the exact same issue ..

http://theitguysblog.com/2007/10/16/zecco-trading-word

-to-the-wise-stay-away/

Brokers make money in other ways too. For instance, they can make money on the spread. They can make sure your bid gets filled against a lower ask, thus pocketing the difference. I would actually imagine that this would be more common for cheaper services since they have to be able to make money somehow, nobody works for free. If you trade frequently, or if you trade in big volumes, then this can make a real difference. A few pennies more on the spread can cost you well over the $10 trading fee that most low cost brokerages will charge you.

I’ve heard that Zecco denies this happens, and that may be the case. But there are many ways that a company can make money on your trading activity, and not all of them beneficial to traders. But if you are only trading small amounts infrequently, I think this might be a fine alternative.

I want to go over to Vanguard as soon as I meet their minimum requirements to avoid certain fees ($100,000) I think. I think that ETFs in your retirement account is restrictive because the system you espouse prevents you from dollar-cost averaging throughout the year, doesn’t it? And if you do buy more than once throughout the year, now you’re paying way too much in fees. Why not just find the mutual fund that the ETF is probably mimicking anyway?

Vanguard is a great option. I would say that everyone should look into them. I personally like ETFs over mutual funds – especially if there’s no commission. I think it’s because I can understand ETFs better. I don’t have to worry about year-end distributions (or if I do, they are invisible to me). As Kevin says, it’s possible to shave down expenses to the last small bit with ETFs, minimal trading, and a low/no commission broker.

I understand why someone might not trust Zecco. They have changed policies quite a bit and the company hasn’t been around long. That being well understood, I’ve read they have legit backers with a huge warchest. Also, they have to clear all the regulatory procedures for being a broker, which means it’s not a fly-by-night Web 2.0 site that was developed in a basement.

ETrade *Shivers*. I’m trying to close all my accounts with them, but I have some $24 that I couldn’t transfer out. I might as well just get it paid to me and then pay the penalty on that massive amount.

I have had my taxable account with scottrade for almost two years and I find their interfaces quite intuitive. Also, they have brick and mortar offices everywhere and I think I read somewhere that the CEO is not planning on going public anytime soon which I suspect also means that they aren’t planning on getting taken over either.

I’ll take the $30 fee for control over my portfolio, over no fee but only underperforming, high expense mutual funds any day!

Better to go for the 70% solution today than the 100% solution never.

I’m a fan of having one account at Vanguard and buying their mutual funds directly. Buying and selling shares is free, and they have a strong ethos and history of keeping the expense ratios as low as possible. Yes, I could shave the expense ratios down a bit by constantly searching for the cheapest broker and ETFs of the moment, but I just don’t have the time and energy for that. And at my level of assets I don’t think it would translate to a significant amount of savings.

If I had to pick a brokerage I’d go with one that has a track record of maintaining a low trade commission, no annual fees, and generally keeps things simple, like Scottrade or ETrade.