Savings for stock market investors highlighted
Canny investors could save between €100 and €350 when investing in stock markets in Dublin, London and New York, a survey showed today.
In the first study of stockbrokers’ fees and charges, the Financial Regulator looked at the cost of buying and selling shares at home and abroad.
Charges for investing €10,000 in a company listed on the Irish or London stock exchange range from €75 to €175.
The minimum charge for investing €10,000 euro in the US stock exchange is almost €100, compared to €75 for the Irish and London exchanges.
The survey also showed when investing larger amounts of money, the difference in fees between different stockbrokers becomes more significant. Charges for investing €35,000 in a company listed on the US stock exchange range from €187 to €545, showing a potential saving of over 350 euro.
Sharon Donnery, head of the Regulator’s consumer information division, said the guide was designed to help people who want to invest directly in the stock market.
“Whether you have experience buying and selling shares or you are thinking about investing in the stock market for the first time, you will want to get the best value from your stockbroker,” she said.
“It is also important to not only look at the commission you will pay, but also ask about annual account maintenance charges.”
The study of eight stockbroking firms looked at three kinds of investments. Discretionary where the stockbroker makes investment decisions on your behalf within agreed guidelines; advisory deals where they advise you on what shares to buy or sell; and execution only where they buy or sell shares you choose yourself.
Irish & UK Dealing Commissions range from zero with Merrion Stockbrokers for discretionary deals to €25 with Campbell O’Connor & Co, Davy (online) and up to €100 with Goodbody and Merrion.
Annual maintenance charges vary from zero with Bloxham, Campbell O’Connor & Co, Faxco and NCB to €40 with Dolman and €80 with Davy.
On US deals Merrion do not charge any commission for discretionary trades but others vary from €32 to €100 and some percentage commissions may be applied.
“It is important to find the service you need and to get the best value for that service,” Ms Donnery added.
“Not all stockbrokers offer the same services. For example, some will act on your instructions only, where others will advise you on what shares to buy or sell and some will make investment decisions on your behalf, within agreed guidelines.”
A copy of the survey can be found online at www.itsyourmoney.ie.
