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Commissions Investors Clash
One of the problems of being an investor is that one will be paying commissions of many trading and investment transactions. Those are usually brokerage fees. They are very tiny but they do sting like bees over a long period of time because they can grow big.
Usually the more sophisticated investors do take measures to avoid paying too much in commissions. The lesser one can pay the better. Believe it or not, small investors who do not have large investment account are surprisingly happy to spend a huge proportion on their investment account in commissions.
One would think that minor investors would have been the one looking to reduce how much they pay in commissions but that is not the case.
Why Do Investors Hate Commissions
Most investors hate paying commissions because of the losing trades or investments that are unavoidable. That is already a concern for them.
They also clash with the brokerage firms because it does not matter how tiny those fees are, they do add up in the long run, and can even deplete a winning investment account.
From time to time, investors do clash with the brokerages firms that have no desire to make life easier for them.
Sophisticated investors dislike brokers that charge big commissions because obviously they are not helpful. One must always look for a reliable broker that does not charge commissions. There are trading firms that have zero commission trading or investing offers. The one that I like very much in 2020 is Trading 212. It offers zero commission trading, investment and ISA (UK) services. Of course, there are others. All one has to do is to Google search for zero commissionbrokerage firms in one's country.
Investors also clash with brokers who charge commissions because of taxes. In many cases investors have to pay taxes on their investment gains. This is on top of the growing commissions. As one can see, taxes plus commissions and losing positions can even turn a clever investor into a loser. Both investors and traders are always looking for ways to limit the damage those may generate.
Small investors who are managing a petty trading or investing account face the huge task of making it as a profitable market players. It does not matter how hard they are trying, commissions and other cost will accelerate their failures.
Commissions, taxes and trading or investment charges are here to stay. At the same time investors will always clash with the brokerage firms. Though those clashes exist, one can limit the damages by using zero commission brokerage firms or manage those charges like a sophisticated investor. The days of seating doing nothing about growing commissions are over for even retail investors. The way things are done in the past must change indeed.
Lastly, to be fair, brokerage firms are businesses that must create values for their shareholders by charging commissions. Traders and investors ought to support them because they provide trading and investment platforms. One can not blame them for everything. Both investors and traders must now take their own destiny in hands.
I hope this article will be beneficial to investors of all walks. If that is the case, please share it and mention us in various trading and investment forums. For me, I am glad that I have done my bit. Stay tuned because soon I will be back with another investment article. Happy investing and trading to all.