2019 Firstrade brokerage hidden fees. Firstrade trading inactivity and monthly fee, additional charges. Costs for the broker's IRA account.

Overview of Hidden Fees at Firstrade

Firstrade is a popular online broker, and a large part of its appeal is its recent decision to offer commission-free trading. This is in line with other brokers, such as Robinhood, that are trying to attract new customers with the offer of unlimited free trades. There are still some fees with a Firstrade account that apply to investors in certain situations, and this article will go over the most common of these, but first let’s clarify what’s truly free and what’s mostly free.

Trading for Free on Firstrade

You won’t incur any commissions when trading stocks, ETFs, options, mutual funds or fixed income securities on Firstrade. They also don’t charge any account maintenance fees or require account minimums. This sounds great (and it really is for the most part) but there are some scenarios on Firstrade where you will incur a fee, and sometimes it’s not that clear. We will dive into these scenarios next.

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Fixed Income Fees

Although Firstrade doesn’t charge you a commission when trading bonds, the price quote will be on a net yield basis. Essentially, this means that Firstrade will act as a market maker when selling to or buying bonds from you and apply a markup/down to the price, which is effectively almost the same as charging you a commission. Additionally, when trading primary market CDs Firstrade will charge you a flat $30 fee.

Hidden Mutual Fund Fees

Although Firstrade doesn’t charge commission for buying and selling mutual funds (load or no-load), they have a minimum investment requirement of $500 for the initial buy and then $100 per transaction for subsequent investments. Investors should always try to meet these minimums if they can because not meeting them will incur a $19.95 transaction fee. There is also a $19.95 short-term mutual fund redemption fee applied whenever shares held for less than 90 days are sold.

Foreign Security Fees

If you would like to transfer a foreign security in to or out of your Firstrade account you will be charged a fee of $75. Investments in ADRs (American Depository Receipts) could also incur an annual custody fee between $0.01 and $0.05 per share.

Other Lesser Known Fees

There are a few other fees that could apply to your Firstrade account at some point in its life, and others that won’t ever apply to 95% of investors. We’ll discuss the most relevant of these here. As is common with most brokers, if you want to transfer your account to another broker (an outgoing transfer) Firstrade will charge you a one-time fee of $75. Partial outgoing transfers will incur a fee of $55. Outgoing wire transfers will cost you $30-$50 each (as is common with most brokers) but electronic transfers are always free.

Firstrade investors that choose to receive physical stock certificates or opt to get their monthly statements in paper form through the mail will incur additional processing fees. These last two options are quite uncommon today, in the age of computers, and can be easily avoided. The fees discussed in this article cover all the fees that will ever apply to 95% of online investors; however before opening a Firstrade account investors should read their full fee disclosure online to be sure they are not in the other 5%.

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