Investing Online Resource Center
Many investors find it difficult to navigate the complex world of investing online, and this is where the Online Investment Bank Resource Center can help. This nonprofit, independent organization serves individual consumers who invest online. The center is sponsored by the North American Securities Administrators Association (NASAA), the Washington State Department of Financial Institutions, and the nonprofit Investor Protection Trust. It is also an official project of NASAA. By presenting useful information and tools, the Investing Online Resource Center helps investors avoid common pitfalls and make wise investment decisions.
Investing in a margin account
If you’re not familiar with the concept of a margin account, you may want to start by reviewing the requirements for this type of account. A margin account allows you to borrow up to three days of funds from a brokerage firm. While you’ll lose your voting rights, you will still receive dividends. This type of account has some disadvantages. You’ll need to be careful in choosing this type of investment, as interest rates can vary considerably from brokerage to brokerage.
Before you invest in a margin account, be sure you understand the risks involved. Investing on margin involves high levels of risk, and you can lose more money than you deposited. You should read the Margin Account Agreement and Disclosure carefully before you begin trading. Generally, low-priced stocks are not available for margin. Always make sure to ask any questions you may have prior to opening a margin account.
Investing in a no-load account
No-load funds do not charge a sales load. However, many load-waived funds still charge fees. These fees are known as 12b-1 fees and cover marketing expenses. While these fees sound good, they can end up costing you a lot more than a load-free option. Ultimately, your best option is to invest in a load-free fund that helps you achieve your investment goals without the high fees.
You can also purchase no-load funds from a financial advisor. These advisors can review your financial situation, your risk tolerance, and your time horizon for investing. If you prefer to work with an investment advisor, look for a fee-only advisor who is paid for the services they provide, rather than through commissions on products they recommend. If you’d rather do everything yourself, you can open an online brokerage account and buy no-load mutual funds. While online brokerage accounts do not charge sales charges for financial advisors, you’ll have to pay commissions for buying and selling mutual fund shares.
Investing in a no-transaction-fee mutual fund
No-transaction-fee mutual funds are those that don’t charge you a fee when you purchase or sell shares of securities. Also known as no-load mutual funds, these types of funds collect investments from many different investors and invest according to the fund’s prospectus. While these funds offer lower investment costs, they may not be as popular as those that charge sales commissions.
No-transaction-fee mutual funds are available through many investment services. Merrill Edge is an online brokerage that provides access to over 800 no-transaction-fee mutual funds. Merrill Edge’s fund screener helps investors sort through no-fee funds and tailor their portfolio. They also provide vital fund statistics. The platform also has an extensive selection of investment types, including futures, forex, and mutual funds with no transaction fees.