I recently did a review of ShareOwner discount brokerage, which promotes regular dividend stock purchases.  One thing that came out of that review, is that regardless of how cheap the trading costs are – regular purchases of stocks are quite expensive.

In this post, I’m going to discuss some strategies to buy dividend stocks (or any other kind of stocks) in the cheapest manner possible at discount brokerages.

Some low cost strategies for buying stocks

  1. Buy one stock at a time.
  2. Buy less often.  Save up for your purchases until the commissions are less than 1% of the purchase price.
  3. Shop around for lower account administration fees.

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  1. Is there more related reading i can check out? Thanks.

  2. In Canada it appears Questrade is the cheapest for buying stock. It seems like a place for the ma-and-pa types that do small trades and just sit on them for decades. They don’t charge any administration fee which is always good.

    For big traders Interactive Brokers is best.

  3. Fees are lowest when going for index funds such as several Vanguard branded ones.

  4. Well, yes and no.

    Yes in that having a portfolio made up of funds will reduce your cost but over time it can actually amount to more.

    No because you forget that equity held in that fund can be bought and sold all the time. Managers of those funds are always eager to sell off holdings. When this happens you are responsible for paying the gains that were realized at the end of the year even if you specifically did not sell any of your lot.

  5. This is why i buy mutual funds. It represents a nest of several stocks for one single price. Sure there is an anual manager fee that gets ripped but still it at least reduces the other fees i might have incurred if i bought them separately.

  6. It all depends on what kind of investor you are. If you trade heavily then going for Questrade’s active investor accoutn which provides discounts on volume is the way to go.

    For small traders, Questrade’s regular type of accounts have always been ideal.

  7. There are some good strategies in there but i still think choosing the right discount broker makes all the difference. For me Questrade is the way to go.

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