SlowAndSteady:

mikehjr:

SlowAndSteady:

It's my understanding that Zecco does not reinvest dividends, so you should receive the dividends as cash.  You'll also receive tax information at the end of the year with the total amount of dividends that you received--the IRS gets a copy too.

 

Yes, I dont want to mess around with fractional quantities... what a nightmare!  So if the company issues a cash based dividend, does that show up in my zecco account, or do i get a check in the mail?  Does anyone know?

 

You'll see the cash in your Zecco account.  You can use the cash for whatever you normally do with it.

A couple quick notes...

Dividends can come as cash or shares. Both are handled through your broker, so they will just show up within a couple weeks of payout.

Assume cash dividend for all below...
Dividends are taxed (again, cash not shares - shares aren't taxed until sold), so don't forget that you have to give a little to the government at the end of the year! Even if you have a dividend reinvestment program setup (which Zecco DOES offer but only for whole shares), it is just an automated investment. You still receive the dividends (and are therefore taxed), but then an automated "system" invests it for you right away. (If you invest regularly you might as well invest dividends yourself since, arguable, you'll know where the funds should go rather than letting them cost average for you.)

Fractional shares aren't a bad thing if you have them. Nearly all brokers will liquidate them for free if you move to a broker which doesn't allow them...such as Zecco. No big deal. The resulting cash is even transferred as part of the original ACAT without extra fees. This usually takes about 2 weeks.

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 Rafe

Anybody notice that you don't need $2,500 to open the account? I was OK with only opening with $300 and my friend with only $1000.

 

I heard they lower the commission to $1000. anyway i have $20,000 in my account.

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Rise of A Star! One Million By 2012!

Actually, dividends should show up in your account within a day of payment.  If you have to wait weeks, I'd contact the broker; something is up.

I'd urge against reinvesting dividends.  Fractional shares can be a pain, particularly when you move your account.  Look at it this way, the liquidated shares will be taxed at the long term capital gains rate (or may be worse, the rate for ordinary income).   Look at it as a 10% commission to liquidate.    The future of any brokerage company is never certain.  I take dividends as cash--especially if fractional shares aren't offered.

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Slow 'n Steady!
www.manifestinvesting.com

db0255:

Anybody notice that you don't need $2,500 to open the account? I was OK with only opening with $300 and my friend with only $1000.

 

 

Are you permitted to trade?  You can open the account, but funding it may be the issue.  If you only deposit a few hundred dollars, are you permitted to trade?

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Slow 'n Steady!
www.manifestinvesting.com

 

 

Duplicate post

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Slow 'n Steady!
www.manifestinvesting.com

I'm 24 and have been doing mostly short term trading for a few months now with my Roth IRA, 8k (maxed 06 and 07 contributions around tax day). If you want to be a short term trader I would use that money for it, as you'll avoid any short term capitol gains. The time to be risky with your money is now, when you can still afford to lose it.

For those very young people on here, get a summer job and see if your parents will match your income with Roth IRA contributions. This is a no brainer as your tax rate will be effectively zero and you can lock that in for 40+ years. You can only contribute up to 4k or your income whichever is lower.

Less risky short term plays should be made with your tax deferred retirement accounts because the long term capital gains advantage will never kick in due to the distributions being counted as ordinary income. And long term(> 1 year) investment should be done with a regular account to take advantage of the current 15% long term capital gains.

It's been interesting and entertaining even if I haven't had much profit. My first foray into options went really well, I a bit more than doubled my money on HERO calls, then took that money and put it into various other options most of which expired worthless. In two months I've swung from up 25% to down 12% and am back to about even now. I would definitely caution anyone about options. A bad stock trade means you lose 10-20%, a bad options play usually has you losing 20-50% or more.

i'm 25 and have been w/ vanguard and their mutual funds in my roth ira and a 401k for the past 3 years. i've started trading individual stocks a few months ago with firstrade. however i am only trading small amounts in my taxable to experiment, so their comissions really eat at me. i'm here and it's been great thus far. not much to add otherwise. been doing alot of research into different companies, reading up in general, and trying hard to have more patience.

I am 24 years old, and i have been trading for almost 5 years. I loses money almost every year. man.. right now, i am learning more about stock from www.investors.com. hopefully i can make better decison and more money with the knowledge from them.

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Rise of A Star! One Million By 2012!

orodabaugh:

I'm 24 and have been doing mostly short term trading for a few months now with my Roth IRA, 8k (maxed 06 and 07 contributions around tax day). If you want to be a short term trader I would use that money for it, as you'll avoid any short term capitol gains. The time to be risky with your money is now, when you can still afford to lose it.

For those very young people on here, get a summer job and see if your parents will match your income with Roth IRA contributions. This is a no brainer as your tax rate will be effectively zero and you can lock that in for 40+ years. You can only contribute up to 4k or your income whichever is lower.

Less risky short term plays should be made with your tax deferred retirement accounts because the long term capital gains advantage will never kick in due to the distributions being counted as ordinary income. And long term(> 1 year) investment should be done with a regular account to take advantage of the current 15% long term capital gains.

It's been interesting and entertaining even if I haven't had much profit. My first foray into options went really well, I a bit more than doubled my money on HERO calls, then took that money and put it into various other options most of which expired worthless. In two months I've swung from up 25% to down 12% and am back to about even now. I would definitely caution anyone about options. A bad stock trade means you lose 10-20%, a bad options play usually has you losing 20-50% or more.

Let me add to what you're saying.  If you invest in a Roth IRA--and can manage to invest $4k a year until you retire, get the average return of around 11% for the market, your total investment of $168 will grow to about $3 million.  Not bad. 

Options can be good.  I have read that 80% or more of options expire worthless.  Of couse in an IRA you're limited to what you can do--covered calls for example.

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Slow 'n Steady!
www.manifestinvesting.com

I'm 26 and have been trading for 8 mos.  Took about 1000 from some bonds my grandparents gave me and started trading at scottrade.  My first pick was to buy ICE at $72.  Not a bad way to start out and I thought I was doing great when I sold it for a 11% gain.  Of course it then ran up to $150 a share :( 

I would highly recommend reading How to Make Money in Stocks by William O'Neil.  A great book on what to look for in a company as well as controlling risk.  I now am a member of a local meetup group that trades based on Investors Business Daily (daily paper by O'Neil) principles.  Its been a great experience and I've learned a ton, but I have a lot of learning to go.

I've since started trading an old 401k that I rolled over here into an IRA.  I have some ETFs and sone single stocks and am getting about 4% right now, so if that continues that puts me at about a 20% a year run rate.  I'll take that!

My advice to those youngsters who are 16 is to read and to paper trade you picks for a while.  You are going to make mistakes when starting out and it can be very frustrating to watch your little nest egg disappear over a bad trade.  And always, always, always have an exit plan before you buy an investment. 

drips? sure... a decent long term way to invest i suppose but rather boring.

best thing you can do kid is get a job and save up. mow grass, flip burgers, whatever. i started investing when i was 12 w/ 100 bucks.. after that i took out a loan of 1,000 bucks from my grandfather and paid him back by working at a newspaper during graveyard shift (i was 18 at this time). from that point on i made several mistakes and learned a lot.

my best advice to you is this.

"you can be wrong and you will be - Austin Craig" , this means that yes, when that stock is oooo so cheap at 25 a share and then its 18 and then its 15 your thinking man,, i gota load the boat up. wrong. load up 1/4 the boat and wait a day or a week and see what happens b/c , see above quote, this way if it goes up you make money , if it goes down you get in cheaper.