JZ,
Actually, the fee can come out to zero:
First, equity positions cost 1%, but bonds and cash are about 1/4%. Still, even assuming the full 1% and assuming a 1M account at Merrill, that is $10,000/year, which compares favorably to my $21,000 in commissions at Fidelity last year. In fact, the $10,000 is equivalent to a blended mix of about 35 monthly equity/option trades at Fidelity which, even though I've dropped day trading, I still easily exceed on a monthly basis among the various accounts. Moreover, over $1M in equity, the fee for equity positions drops to 80 basis point. Bonds drops from 25 basis points.
Second, points earned on the Merrill Visa card can be used to pay for commissions. As I run just about everything through the Visa card, I would expect the yearly fee to be largely paid for by the Visa points.
Third, as the article noted, I invest "mainly" but not exclusively with Merrill. No need to incur fees on money that is fairly stably invested in mutual funds.
Gary Korn |
