First impression on unpacking the Q702 test unit was the solid feel and clean, minimalist styling.
Which bank doesn't minimise trading fees?
- — 31 March, 2000 15:21
It is cheaper for a Commonwealth Bank (CBA) customer to trade via Quicken.com.au's share trading service than with CBA subsidiary Commonwealth Securities, argues Quicken insider Timothy Moore.
Both Quicken's online trading service, Quick.Broker, and Commonwealth Securities' online trading service, ComSec, this week claimed first place in the race to lower online share trading fees to below $20.
While Quicken's price of $19.90 per trade is open to all Quicken customers, a ComSec spokesperson confirmed that ComSec's revised price of $19.95 per share was only available to customers holding a Commonwealth Direct Investment account (CDIA). To open a CDIA, a customer must initially deposit $5000 in the account, ComSec said. All other ComSec customers will still be charged $29 per online trade, ComSec admitted.
According to Moore, who is CEO of Hartley Poynton, the company which developed Quicken's trading engines, a ComSec customer placing a $6000 trade is obliged to pay an extra $10.80 per trade, totalling $30.75 per trade, if they wish to transfer the dividends of the trade into their original bank account. The $10.80 is the sum of three $3.60 account transfer fees (a government deposit tax of six cents in every $100), one for transferring money from the user's original bank account into their CDIA, one for placing the trade dividends back into the CDIA, and one for transferring money from the CDIA into the customer's original account, he said.
Moore claimed the $7.20 in transfer fees that CDIA holders were required to pay as unnecessary. Quicken, which transferred moneys directly into the customer's original bank account, charged only one transfer fee, leaving the total cost of an equivalent trade at $23.50.
On the other hand, the ComSec spokesperson criticised Quicken's model, highlighting an "amendment fee" which was incurred if a Quick.Broker user retracted an online trade. "Let's face it. A lot of people change their mind when they're trading online," the spokesperson said.
Moore conceded that Quicken had previously threatened indecisive online traders with a "right to charge" fee, but he said Quicken had never once charged, and had consequently abolished, the fee.
The ComSec spokesperson said customers wishing to trade in stocks not included in ComSec's top 1000 stocks list were required to place their trade by telephone. The ComSec phone-trading price, of $50 per trade, would remain unchanged, he said.
Moore said Quick.Broker customers were able to trade online in stocks of the approximately 1900 companies listed on the Australian Stock Exchange.