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Omoba3
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« on: April 22, 2008, 05:30:18 PM » |
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Stockbrokers are a crucial element in the grand scheme of buying and selling shares on the stockmarket. Using just any stockbroker won't do! You need a broker that can deliver in terms of
Being able to buying when you place an order and at the best possible price as close as possible to your target entry price (subject to availability)
Being able to sell at the right time and at the best possible price, based on there being buyers available, willing to buy at the price you are willing to sell.
Being able to respond within a reasonable time set to your requests. (It helps to know if your previous orders were actioned or not, as this it aids your decision against the next trading day. A standard response time should be set/agreed upon i.e. at the close of each trading day by text, email or phone call)
This thread will assist all of us (those that already have a broker and those that don't) to know those that are performing, can perform or those that are just no good.
Please help by responding to the following questions:
Name of stockbroker:
Do they have an online presence:
Minimum Investment:
Do they have a Research Team (stock analysis):
Can you communicate with them through emails/text messaging: Essential for investors based abroad.
Will they be able to meet the recapitalization requirement:
Who are their bankers: Essential for ebanking transfers direct into their accounts (more important to investors based abroad).
Rating system: (1 = No Good, 2 = Poor, 3 = Average, 4 = Good, 5 = Excellent)
Communication = (acknowledging requests whether positive or negative)
Accuracy = (in carrying out requests)
Speed of execution = (how long it takes to fulfil buy/sell orders)
Online facility = (existing or non-existent, regular updates or no updates)
Ease of Transfer = (Ease of transferring away from them if and when the need arises)
To assist with choosing a stockbroker here is a letter drafted by a friend, which we can all use before signing up to a new broker:
It contains a total of eleven (modifiable) questions which I believe should be standard questions for all investors seeking a stockbroker. The questions asked were designed to help investors based both at home and abroad.
This sample letter also contains the response of a broker to this letter. The broker's response is highlighted in blue. Question ten is a new addition
Dear xxxx.
Thank you for your email.
Please find the answers to your questions below.
1. I'm very much interested in using any online facilities you have
available, as this will be my main source of monitoring with my
stockbroking account with you. I particularly rely on emails and text
messaging to issue buy/sell orders and would like to know if this
acceptable with you?
Yes: Apt offers online stockbroking free of charge and registration is easy
2. What sort of operational online facilities do you offer?
Our online facilities allow you to check you statement online, give buy
and sell mandates etc.
3. And how often or frequently do you update the information on your site,
particularly, information pertaining to my portfolio?
Information is update as often as needed, price list and stock information
and account statement is updated whenever there is an activity on the
account.
4. Will I be able to transfer monies directly from my bank account to
yours via e-banking? If yes, who are your bankers?
Yes you can transfer money straight to our account, however you should
ensure the money is deposited in your name and you should send us the
teller number and payment details. We bank with GTB, Zenith and Oceanic.
5. What is the minimum required to open an account with you?
The minimum required to open an account is 250,000naira only.
6. Can the minimum you require include a transfer of my existing shares,
and how long does it take to get the account operational?
Yes, the minimum may include a transfer of shares based on the current
market value. Also your account will be operational once you register and
your cscs account is open which ideally takes less about a week.
7. Will I be able to receive contract notes and other relevant documents as
email attachments?
We do not normally send contract notes via email and transaction will be
visible on your statement. Please indicate the other relevant documents
are you referring to?
8. In order for me to effect buy/sell orders effectively, I would
appreciate a comprehensive and complete list of all Statutory and other
charges you have, connected with buying and selling of shares, as this
influences my decision to open an account with any broking firm.
The new charges as directed by SEC are split into buy and sell:
On the Sell side:
Stockbroker income: 1.125%
NSE Fees: 0.525%
CSCS: 0.4725%
Stamp duties: 0.075%
Total: 2.6475%
On the Buy Side:
Stockbroker income: 1.575%
SEC Fees: 0.60%
CSCS: 0.105%
Stamp duties: 0.075%
Total: 2.355%
9. With regards to the new capitalization directive, how does this affect
your company and any shares bought with you?
APT Securities and Funds Limited can only be positively affected by the capitalization directive. We are not at any risk of breakdown, merger or acquisition and are well within the requirements of the capitalisation.
Please do not hesitate to contact us for any other enquiries.
Thank you.
Yours Faithfully,
APT Securities and Funds Limited
10. Is it possible to be informed of the outcome of my buy and sell orders at the close of each trading day? As this will essentially assist with placing effective orders against the next trading day. Can you agree on an effective means of communicating this information to me? i.e. text messaging, email, phone call, or online - if you have such a facility.
11. Do you have a cut-off time for placing buy/sell mandates? If yes, are you flexible with this? Would you give any consideration to people based outside the country, considering we all live in different time zones? (thanks to Man Jiro for highlighting this)
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This thread is a collaboration between Aktopgun and I and is modelled on a similar thread I started at SMN. We reckon that this thread is essential to our progress as investors, which is why as a follow-up to this thread, we will be looking at a situation whereby on a monthly or quaterly basis, we will collate all info/data everyone has provided on each Stockbroking firm and choose the best firm(s) based on all these recommendations and feedback given.
The obvious reason for doing this is to help us with choosing or deciding on a reliable stockbroker.
This will at some point be taken a step further, as we will contact brokers that we rate highly, to the end that we inform them that we represent members of this forum (and our sister forum SMN) and would like to negotiate favourable conditions for members that we recommend to them.
We intend to make them aware of both forums and the ratings generated by members, as this will hopefully make them pay more attention to us their customers, the service they provide and the power we weld as their customers.
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