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My first zero cost transaction at zecco.com: BUY 25 NVDA shares

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deminvest

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I did it today! It felt really really good to trade without commissions for the first time in my life: WOW!

Free Trade at zecco

my first impressions:

  1. Zecco’s website is clumsy and slow. Takes too long to get where it counts: the Trading Center
  2. There are trading options that I don’t understand. Transactions can be “Buy”, “Sell”, “Short” or “Cover”. I know how to use the first two, but I do wonder what would happen if I simply shorted a stock.
  3. Order Type can be: “Market”, “Limit”, “Stop”, “Stop limit” or “VTSO”. Again I do undersstand the first two: I can buy at market price or I can set a limit to how much I want to pay. I also understand “Stop limit” because underneeth you can decide the STOP (meening that, if a share reaches a certain price the transaction will trigger) and the limit is how much I accept to pay. I don’t understand what happens if I set a Stop without a limit and I don’t have a clue about “VTSO” order type.
  4. Duration can be: “day” or GTC=”good till canceled”. I understand both.
  5. Preferred ECN: is set on AUTO. I have no clue what it means, but I have no choice anyway.
  6. AON: if I check it, my order will be executed “All Or Nothing”
  7. Once I have filled all fields of the order (buy 25 NVDA shares) it is executed really fast and did really cost 0. I was actually gaining a few cents seconds after having executed the order. I got 25 NVidia Shares at $39.30 each, which was the price zecco showed me a second before I hit the OK button.
  8. They could use some Ajax scripting to let me see my portfolio move as prices change
  9. They could put a little questionmark next to unknown words; so people like me don’t have to look all over to find out the meanings.
  10. At zecco they say they make money by only paying 1% interest (and earning more) on money sleeping on accounts and by building a community and selling advertising. Sorry zecco, but your community sucks!

19 responses to “My first zero cost transaction at zecco.com: BUY 25 NVDA shares”

  1. witek Avatar
    witek

    how old are you my friend?

    Reply
  2. deminvest Avatar
    deminvest

    34

    Reply
  3. Jon Avatar
    Jon

    I’ve been looking for an experience of Zecco, since I’m too hesitant to sign up for them myself. 🙂 If they’re still around in a year or two I think I will transfer my account (currently with TD Ameritrade) to them.

    Reply
  4. deminvest Avatar
    deminvest

    Actually I didn’t tranfer my account on zecco. I simply opened a new one. I will use it for my new buys and I will fund it when I want to be ready for new buys.

    Reply
  5. witek Avatar
    witek

    some questions.

    1. where did you come up with this investing idea of spending $1000 to aquire shares in 1 stock per month?

    2. do you read investing books such as Security Analysis by Benjamin Graham?

    Reply
  6. deminvest Avatar
    deminvest

    1) I started to think that it may be a good idea to invest the same ammount every month by reading an article about “dollar cost averaging” on some newspaper. I don’t remember who wrote, but that article made me think. The idea was to invest on a regular schedule over a lengthy period, in order to capture lower as well as higher prices. By that system you can earn even when markets go down. Let’s say that stock A
    costs $10 in June: I buy 100 shares of A with my $1000.
    It goes down to $ 5 in July: I buy 200 shares with my $1000.
    It bounces back to 8 in August: I buy 125 shares.
    At the End I have 425 shares worth $3400.

    Share A has gone down 20% but I have gained 13% on it, simply because by dollar cost averaging I have bought most shares (200) at the lower price.

    My investment strategy comes from:

    1) the idea described above.

    2) $1000 is what I am able to save in a month

    3) I hate paying yearly commissions to funds (even a 1.5% commission eats up eats up 34% of the capital in 20 years), so I need to buy many different stocks (like funds do) by myself

    4) I want to buy low and sell high. 40% up is high.

    Reply
  7. deminvest Avatar
    deminvest

    I forgot the main reason:

    5) I have fun discussing stocks with you and chosing “The One” each month !

    Reply
  8. sharky Avatar
    sharky

    Not sure if the 1% interest on cash would bother an investor. Since trading is free, an investor holding cash could always purchase very short term treasury ETFs like BIL or SHV.

    BTW, eTrade only pays 2.5% on cash. Fidelity offers money markets that pay a handsome 5.25%.

    Reply
  9. deminvest Avatar
    deminvest

    Sharky, that is absolutely true. With those free trades it is easy to put money on bonds ETF.

    Thanks for suggesting “BIL or SHV”. I was wondering which may be the best ETFs for cash parking.

    Reply
  10. Dennis Goedegebuure Avatar
    Dennis Goedegebuure

    I have been hesitant to start using Zecco.
    But free trades sounds very nice. Now I’m stuck with the fees at ETrade, and that eats so much into your margins.

    Good luck on Zecco.

    Reply
  11. deminvest Avatar
    deminvest

    Dennis, you don’t have to close your Etrade account. It doesn’t cost you anything to have two trading accounts.

    Just open a new zecco account, fund it with a small amount and try it. If you like it, you can move more dollars on it later.
    This is how I did.

    Reply
  12. marketprofit Avatar
    marketprofit

    Correct. I have two accounts I am currently using and have quickly been shifting the bulk of my money into the zecco account. The ability to make zero cost trades just can not be beat. It is great for long term investments as well as short stints into and out of the market. I think it is funny how they have not been getting the press they deserve. If people really understood that they truly are a zero cost broker there would be a mass exodus from the fee based brokers. Happy trading.

    Reply
  13. Kevin Avatar
    Kevin

    Actually, you can get more than 1% on your idle money. Knowing how lazy you are I’ll post the link to the form http://www.google.com/url?sa=t&ct=res&cd=1&url=http%3A%2F%2Fwww.zecco.com%2FDownloads%2FForms%2FMoneyMarketSweepForm.pdf&ei=SnMNR8WAL4e8gQOuu9Ak&usg=AFQjCNG8T9EGfk7SCBWa_s3k8w5v50itOg&sig2=Om-XtbeFqE7BYpYYMPwHvw

    Fill it out. Yes, you have to put your name in again! It is annoying isn’t it?

    This is the form to the Money Market Sweep. You can get up to 4.39% instead of the crappy 1% and your cash is still ready at hand to buy stocks.

    This is a really great site. It is much like the one I am making except mine is more of a personal journal.

    Reply
  14. deminvest Avatar
    deminvest

    Thanks a lot Kevin,

    specially for making it so comfortable for me… They should hire you as Customer Relationships manager at Zecco.

    Recognizing that someone can be lazy is a great part of Google’s success. Those people at Zecco don’t seem to understand that… or the fact that trowing away 90 cents to put a stamp on a written communication for every transaction does not help anybody.

    Reply
  15. Kevin Avatar
    Kevin

    I emailed them the form as the instructions said for the Money Market Sweep and they emailed me the next day saying it would be in effect in 5 business days. Wow, they are getting better. It did take them a month to activate my trading account but I am a sucker for instant results and will let that pass.

    Crappy part though is that I have to MAIL in the exact same form I emailed to them! They never heard of a printer? Now they want me to waist 41 cents! Why I never I’m going to take my business to the other broker that gives me 10 free trades a month with a low minimum balance…

    …Wait. There is no one else. I guess I have to take it.

    The funny think is deminvest. I have found more information on Google about how to open an account than I have on Zecco’s crappy Help area and customer service.

    Reply
  16. deminvest Avatar
    deminvest

    Kevin, hopefully things will change at Zecco because of the $25 Million infusion by Venture Capital investors.

    Good news for zecco: $25 Million raised. What about us users?

    Reply
  17. silly Avatar
    silly

    Silly question.. do you normally place a limit or market order when you buy your shares?

    Reply
  18. deminvest Avatar
    deminvest

    I always place market orders. When I decide to buy or sell, I want to be sure that my decision is executed immediately. I sell only with 40% gain, so a 0,1% difference doesn’t change much.

    Zecco is really fast in executing orders. My orders always do go trough very close to the price that I expect.

    Reply
  19. Equity School Avatar
    Equity School

    Great Article. Graham is considered the first proponent of Value Investing, and I am a great fan of Benjamin Graham myself, I follow most of his rules, I started a site on value investing. The site mainly screens out Low PE, Low PB, High Divident Yeild. Low PB+ High Div etc.. for the India markets. I really appreciate the effort you have put in your blog. Best Wishes.

    Reply

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