Trading via your bank

2014-06-15 15:00

First National Bank (FNB) seems to be ahead of the pack in terms of offering you a variety of investment products to suit your appetite and wallet.

The only bank that does not seem to be offering clients any type of support in the form of education around share investing is Absa, which also seems to be the most expensive with the highest minimum brokerage fee of R120 per trade.

Note that you do not have to bank with a particular bank to open a share trading account with it.

But you will have to satisfy Financial Intelligence Centre Act (Fica) requirements as with any other financial transaction.

FNB

FNB offers you three different share trading options?–?Share Saver, Share Builder and Share Investor. You can choose the option that suits you. FNB conducts biannual consumer education seminars with the JSE for its clients who want to learn more about investing and what to look for in a share.

Share Saver

This option makes regular monthly investments in the top 100 JSE-listed shares. This is an easy, no-fuss way to invest in shares without having to make difficult choices about which share you want to invest in. In essence, you are investing in the top 100 JSE shares so this is very similar to an exchange-traded fund (ETF).

Minimum investment: R300 a month.

Fees: The fee is calculated on an annual basis but charged monthly. It is based on the market value of your portfolio as follows:

.?Up to R250?000: 0.4% a year plus VAT.

.?R250?000-R1?million: 0.35% a year plus VAT.

.?More than R1?million: 0.3% a year plus VAT.

You will also have to pay the following charges (all excluding VAT) per trade:

.?A brokerage fee of 0.06% or a minimum of R40 for trades at 3pm.

.?A brokerage fee of 0.1% for trades delayed until the first trading day of the month.

.?Investor protection levy of 0.0002% of your capital investment. This is not applicable for trades delayed to the first trading day of the month.

.?Strate fee: 0.05623% at a minimum of R10.95 and a maximum of R54.59. This fee also only applies to trades on the same day.

Share Builder

If you feel up to making choices, you can opt for Share Builder, which allows you to choose from a basket of 24 preselected blue-chip shares as well as Krugerrands.

Investment size: Usually R2?500 per trade.

Fees: A monthly fee of R19 and a brokerage or trading fee of 2% per trade, calculated on the capital investment amount with a minimum of R50 a trade.

Share Investor

For the more experienced investor, FNB offers the Share Investor option, which allows you to build an investment portfolio from the entire range of shares available on the stock market.

Investment size: Usually R5?000 per trade.

Fees: A monthly fee of R49 with the following charges per trade:

.?Brokerage fee of 0.6% or a minimum of R80.

.?Investor protection levy of 0.0002% of capital investment.

.?Strate fee of 0.05459% with a minimum of R10.95 and a maximum of R54.59.

.?Securities transfer tax of 0.25% on the capital investment?–?for buy transactions only.

Tablet functionality: You can trade via the FNB banking app.

STANDARD BANK

Standard has been offering clients online share trading for at least 15 years and it has extensive experience in the field. You can trade online or via telephone.

But you have the entire stock market at your disposal, which might be a bit daunting for the first-time investor.

To address this, the bank offers national educational road shows, webinars, YouTube videos and interactive online tutorials for clients.

Fees: The Standard Bank fee structure seems to be quite favourable. Your first calendar month is free and if you do three or more trades in a calendar month, the account maintenance fee of R60, including VAT, falls away.

.?The brokerage fee is 0.5% of your capital investment with a minimum of R60. If you want to trade via telephone, there is an additional fee of R35.

.?The securities transfer tax is 0.25%, which is only payable on purchases.

.?The investor protection levy is 0.0002%.

.?Strate fee: 0.005459% with a minimum of R10.92 for trades up to R200?000 and a maximum of R54.59 for trades worth more than R1?million.

Tablet functionality: You can trade via the Standard Bank share trading app.

If you bank with Standard Bank, you have to download the Standard Bank banking app and the bank’s online share trading app.

But if you bank with a different bank, you only need to download the share trading app.

NEDBANK

Nedbank offers you online share trading via Nedgroup Private Wealth Stockbrokers.

Minimum investment is R10?000.

Fees: If you open your trading account through a portfolio manager, you will be charged a one-off account opening fee of R250.

If you have owned shares for a very long time (i.e. you have a share certificate) and you want to open a trading account to sell the shares, you will be charged a one-off account opening fee of R1?000.

There is a quarterly administration fee of R150 and a one-off fee of R250 if you close the trading account. The brokerage fee is based on a tiered scale as follows:

.?Up to R250?000: 0.7%

.?R250?000-R750?000: 0.5%

.?R750?000-R1?million: 0.35%

.?The minimum brokerage fee per deal is R70.

.?Securities trading tax on purchases: 0.25%

.?Strate fee: A minimum of R10.92 and a maximum of R54.59.

.?Investor protection levy: 0.0002%

VAT is payable on all the above fees and brokerage rates.

Tablet functionality: Available via the Nedbank banking app.

ABSA

Absa offers you share trading via its online banking and through a stockbroker. To use the stockbroking service you will have to go to www.absastockbrokers.co.za or call 0860?050?403 for stockbroking assistance. This bank unfortunately does not offer any educational training or seminars on share trading although it said it was “looking into it”.

Fees: An annual administration fee of R800. This fee is waived if you trade at least five times during the calendar year.

.?Brokerage fee: 0.4% of the value of the securities traded with a minimum brokerage fee of R120 per trade.

.?Securities trading tax on purchases: 0.25%

.?Strate fee: A minimum of R10.92 and a maximum of R54.59.

.?Investor protection levy: 0.0002%

VAT is payable on all the above fees and brokerage rates.

Tablet functionality: Not available yet.

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