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Strategies & Market Trends : Dividend investing for retirement -- Ignore unavailable to you. Want to Upgrade?

To: Ditchdigger who wrote (26246)	1/4/2017 11:38:14 AM
From: geoffrey Wren	Read Replies (1) \| Respond to of 34328

I remember those old commissions. When I was in college they talked about the commissions, on the order of $200 to buy $4000 of stock. Merrill Lynch, etc. In the old days if the agent saw a weak-minded investor they would "churn" the account. Buy, sell, buy, sell. Do that a number of times and the agent has picked up commissions worth 5% or more of the weak-minded investor's portfolio. In extreme cases the account was churned to nothing. Then when I got into the game myself, Schwab had made its revolution. They started I think with $49 trades, and then got down to $35. Still a large portion of a $4,000 purchase. And in those days I had purchases of $1000, $2000, which was a lot more money in the 80's. But that price was only guaranteed for 100 shares. I purchased 2000 at 7/8ths, and the commission was $50 or so. And when I made that purchase the spread was 1 x 7/8. 12% spread. Younger guys take it for granted the thin spreads, the low commissions. Now you can do a round trip on a major stock at under .1% for commissions and spreads. Although I still do see the old days a bit in the spreads on the thinly traded stocks such as AHT-G. It still takes some attention to get in and out of those sorts of stocks.