Psg online share trading costs

This article was first published in the third-quarter edition of Personal Finance magazine. Deciding on an online stockbroker is not simply a matter of taking your pick from a list.

Nicola Comninos, JSE senior manager: Some online trading platforms provide access to a limited range of instruments. For example, you may not be able to trade derivatives or, if you can, you may be charged an additional fee for doing so.

However, a limited range of products makes sense when you are starting out, or have limited means. Simon Brown, chief executive of JustOneLap. Although costs are an important factor in your choice of online stockbroker, Guy Algeo, a director of Imara SP Reid, says it is equally important that you have access to the services you need. Algeo says that, as a new investor with little knowledge, you may be better off using a full-service stockbroker, with an online platform as a back-up that enables you to check on your investments daily or regularly and improve your knowledge.

Online stockbrokers may look cheaper on paper, he says, but full-service costs can be negotiated. Gary Booysen, of Vunani Private Clients, says online trading has become so competitive that the traditional model of full service has almost merged with online trading. Some platforms charge higher monthly account fees, but lower trading costs, and others do the reverse. A low-cost option from an online broker may cover only the monthly administration fee, for example, or give you access only to securities listed in a particular sector of a stock exchange, with other trades incurring higher costs.

There are standard share-trading costs that will be collected by your stockbroker on behalf of other parties. Stockbroking charges in general are based on a percentage of the amount bought or sold, but there is a minimum rand charge.

So a trade under, say, R5 or R10 is going to be more expensive in percentage terms than a larger trade, depending on the minimum brokerage cost.

Most stockbrokers say that R5 is the absolute minimum you should have in a portfolio, and no single trade should be below this amount, either. The best guideline for the minimum trade is the amount at which a minimum rand charge will apply. The lower you go below this point, the more expensive your trade will become. Many stockbrokers have set or recommended minimum requirements for portfolio accounts, based mainly on their fee structures. Self-service will cost the least. It is likely to cost you more if you want individual advice on trades, or you have the stockbrokerage make the investment decisions on your behalf.

Most online brokers provide, free of charge, minute-delayed prices for research purposes, but you receive live prices when you trade. There is a fee for live prices because of the charging structure of the JSE. It charges for real-time prices but not for minute-delayed pricing.

Access to real-time prices is important for a day-trader someone who regularly buys and sells sharesbecause the smallest difference in prices can make a big difference to profits or losses. In most cases, it will needlessly add to your costs.

You will receive real-time prices when you trade. An issue you should take into account with live prices are the price levels — in other words, how many trades you will see.

For example, you may see only the last traded price, or you may see the previous five or more prices, all of which will probably have happened in seconds, depending on the liquidity of a security how often it trades. Live share prices with the five best bids and offers on the trade and quote pages are charged at 15 cents. These are snapshots of the price of the share when you refresh the computer screen. These prices are available and chargeable between 8.

For example, by telephone, rather than using the online platform. This includes being kept informed, in print or electronically, about activity on your trading account, such as order confirmations.

The stockbroker may charge a separate levy on interest earned on the cash held in your trading account. The money may be held in the JSE trust account or a money market account.

The rates paid on money market accounts vary, with a low rate, in effect, serving as an opportunity cost. The costs for other trades, such as for derivatives, bonds, Krugerrands and offshore investments, are likely to be different.

You should be able to access your port-folio easily. You should also be provided with information such as costs, current prices, your current profit or loss, psg online share trading costs income history interest and dividendsthe balance in your trading account and your tax liability in particular, CGT, stochrsi trading strategy also interest earnings and dividends tax.

You should take into account the facilities offered to manage your portfolio see Table 3, link at the end of the article. These are the two main divisions in the level of service that you can receive from a stockbroker:. You may still call your broker clubpenguinhq/moneymaker no download ask for his or her opinion, for which you will probably pay a fee.

However, you take responsibility for all your trading decisions. You may be able to choose to place your orders telephonically or through your chosen online platform and relative costs will vary, depending on the stockbroker and the instruments traded.

For example, you may permit only investments in listed equities or limit the number of trades a month. A discretionary service is more expensive than a non-discretionary service, but both will carry different levels of costs depending on such things as how much money you have invested, the number of trades and the number of services you require.

Online brokers such as Imara SP Reid and PSG Online offer access to a wide range of securities, including equities, bonds and derivatives, on both the JSE and foreign exchanges, whereas others, such as Absa Stockbrokers, limit access to the JSE equity market, including shares, warrants and exchange traded products.

This can be based on an actual price being reached or on a percentage of a price over a period of time. Online brokers that offer this facility include FNB Securities, Imara SP Reid, PSG Online, Sanlam iTrade, Standard Bank Online, Thebe Securities and Vunani Private Clients, all at no cost. Those that do not offer this facility are Absa, Investec although it plans to offer some simple strategy to use for a novice binary options and Nedbank Private Wealth.

SENS is a JSE facility on which all announcements must be made about listed securities. These announcements can range from company warnings about lower-than-anticipated profits, to dividend declarations and company mergers. The aim is to make information available to all investors and potential investors simultaneously. This includes graphs that show intraday trades and the long-term trends of individual securities and their benchmark indices.

It is important that you know the tax consequences of your investment decisions. Although an online broker pays dividends tax on your behalf, you are responsible for paying tax on interest and capital gains and, if you are classified as a share-trader, income tax on your profits. You must find out if you will be provided with reports that you can use to complete your tax returns.

You also need to know how CGT is calculated — on a first-in, first-out basis, or using the weighted average. This yahoo finance taiwan stock exchange the more complicated method, because the number of securities in each trade when you buy and sell may not correspond, and may involve a number of different trades.

The weighted average uses the price you have paid on average for a particular security as the base price. It is important that beginner investors choose a platform that provides integrated assistance or education, Comninos says.

Online Share Trading & Stock Maket Program

The JSE provides extensive education via its website and webinars, and at the public events it hosts with stockbrokers, for which there is no charge.

Standard Bank and PSG Online have a reputation as leaders in the education of new and experienced investors. They both host webinars and seminars, often bringing in outside experts. An important aspect of education, particularly for new investors, is the availability of trial runs using phantom portfolios or having free initial access to an online platform. By signing up on more than one platform and taking advantage of the trial period, you will be able to compare the platforms for their ease of use and the facilities and services they provide.

The following platforms provide this facility:. The availability of research material should play an important part in your decision on which platform to select. You need to establish whether comprehensive research is available and whether it comes at an extra cost.

Research can include a wide range of services. Probably the most important research is into companies, leading to conclusions such as whether to buy, sell or hold a share.

How To Start trading on the JSE | News24

However, research should include the information provided by FNB Securities, which provides all the facts and includes:. Many investors use computer-based tools to help them analyse the markets and investment instruments. Online stockbroking platforms offer tools for both fundamental analysis and technical analysis. Comninos says you should assess these tools for their ease of use and the extent to which they have been integrated into the platform. Financial website Investopedia defines fundamental analysis as a method of evaluating a security that entails attempting to measure its intrinsic value by examining related economic, financial and other qualitative and quantitative factors.

Investopedia says technical analysis is based on past market prices and technical indicators.

Share trading online from South Africa

Technical analysts believe that short-term price movements are the result of supply and demand forces in the market for a given security. The nature of the security is less relevant than the current balance of buyers and sellers. Based on the careful interpretation of past trading patterns, technicians try to discern this balance with the aim of predicting future price movements. Although ease of use is the most subjective element when choosing an online platform, Comninos says it may be the most important.

If you find that one platform is easier to navigate and more intuitive than the others, this is certain to become an important factor in your decision, she says.

This highlights the importance of trying out as many platforms as possible before making a decision. More and more investors are taking money abroad thanks to the gradual easing of exchange controls and the increase in the offshore investment allowance to R4 million.

However, stock market investors want to be able to operate without having to deal through offshore entities. Increasingly, local stockbrokers are offering facilities to trade offshore, but not all do so online. The online platforms that offer this service to a greater or lesser degree include Imara SP Reid, PSG Online and Sanlam iTrade.

Shop Loot African Independent Young Independent IOL Property IVEO. Which online trading platform? There are a host of factors you should consider when choosing an online trading platform. Range of products Some online trading platforms provide access to a limited range of instruments. Costs Although costs are an important factor in your choice of online stockbroker, Guy Algeo, a director of Imara SP Reid, says it is equally important that you have access to the services you need.

VAT is payable on brokerage fees, the Strate fee and the investor protection levy. Stockbroker costs will also be affected by: The online brokers that offer real-time pricing and their costs are: R99 a month, but waived for investors who trade three or more times a month.

JSE data at cost, but free if you do five or more trades in a month. Your portfolio You should be able to access your port-folio easily. Services You should take into account the facilities offered to manage your portfolio see Table 3, link at the end of the article.

These are the two main divisions in the level of service that you can receive from a stockbroker: This can be based on an actual price being reached or on a percentage of a price over a period of time Online brokers that offer this facility include FNB Securities, Imara SP Reid, PSG Online, Sanlam iTrade, Standard Bank Online, Thebe Securities and Vunani Private Clients, all at no cost.

Brokers that provide tax information include: Education It is important that beginner investors choose a platform that provides integrated assistance or education, Comninos says.

The following platforms provide this facility: Research The availability of research material should play an important part in your decision on which platform to select. However, research should include the information provided by FNB Securities, which provides all the facts and includes: Analytical tools Many investors use computer-based tools to help them analyse the markets and investment instruments.

Ease of use Although ease of use is the most subjective element when choosing an online platform, Comninos says it may be the most important.

International access More and more investors are taking money abroad thanks to the gradual easing of exchange controls and the increase in the offshore investment allowance to R4 million.

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