A bit OT financial advice: it's almost never worth it to buy a single share. The reason is the commission will eat you up. Assume a low $7/trade commission. That could possibly cost you $14 round trip (purchase/exit).
With Tesla ~$100/share, It'll have to go up 14% just to break even on the trade. Even if you just buy in single shares but exit in multiple shares to spread the commission, you still have to fade 7% commission. Not worth it.
If you're investing in the hundreds of dollars, you should look for low commission options such as CDs.
(Assuming this was meant as a reply to my comment) - I do understand that, I pretty much just bought a single share to say I had one, and see how it would perform, more as an experiment and out of curiosity than an actual business interest.
Yes. I would've reposted but it already got replies.
I can understand the desire to experiment, just keep that in mind for future trades. Commission can be a killer as you trade more, especially if you trade less than a few thousand dollars at a time.
"I pretty much just bought a single share to say I had one"
Depending on your social circle, this gets done with kids a lot, especially with an old fashioned issued paper share instead of electronic. Decades ago Disney used to have quite an elaborate paper stock certificate for this purpose and they obviously used their professional artists and graphics designers. My local electric company in comparison looked little better than a secretary hand typed it, which might be how they made it... Perhaps they still do this. Its hard to find a corporation worth endorsing to my kids like this.
Also during the first dotcom boom there were at least a couple people collecting paper certificates from dotcoms and they still trade among themselves to this day as collectibles.
Just some interesting ideas to think about / google about.
LOL more like my hippy anti-capitalist protestor friends probably would not find it funny to give their kid a share of GM or BRK.B, or give a share of BP to tree hugger's kids. If I had any friends who were hard core anti-gun, then a share of Ruger for their kid would go over about as well.
A lot of Green Bay Packer fans have shares of the team (they had another stock purchase some years back). It makes for a nice thing to have framed during football season.
At least with Packer shares you know in advance it's not a good financial decision, because they don't appreciate or return dividends. It's basically just a certificate of fandom.
Ah I see via some google that there are now trading companies set up for this, simply give them some money via CC and you get the cert in the mail already mounted in a frame maybe with an engraved plaque. This takes some of the "fun" out of it.
Keeping it on topic, you'll be out about $200 for a nicely framed paper share from Tesla Motors, at least from these guys.
Back in the old days, or at least in the 70s, this was a much more complicated manual process where you'd have to call your broker and pay a ridiculous commission and usually a relatively modest (compared to recently...) delivery fee, and then frame it yourself, and possibly engrave a plaque yourself, etc.
Also looks like paper shares are going completely away, which is really too bad, as they were a kinda cool gift idea. From a purely PR perspective you'd think the marketing dept would keep it on life support, at least at some companies, even if it moves out of the finance dept. Perhaps an attractive one page sign declaring you're a shareholder, as opposed to formal legal stock certificates. Maybe it'll all be "mozilla open badge system" instead LOL.
The dotcom collector guys are going to be sad that literally no facebook paper share certificates will ever be issued, for example. All electronic now via the DRS. I was in financial services industry about 20 years ago and I'm astounded it took this long to eliminate paper... Had to wait for the dinosaurs to die off I guess.
Presumably the advice should be "it's never worth it to only buy a few hundred dollars worth of shares", since buying a single share worth $10,000/share is a decent deal (with respect to the commission, at least).
There aren't many shares priced up at that point because there is usually a stock split so that the shares are then more affordable and therefore more liquid.
Also slightly OT, but Loyal3 (http://www.loyal3.com) provides fee-free stock trading - both entry and exit. Unfortunately they don't carry TSLA on their platform yet.
Loyal3 works with publicly-traded companies on creating a Customer Stock Ownership Plan or CSOP. In a CSOP, a company pays the brokerage fees on behalf of the investor because it might want to have more of a connection and more loyalty from its shareholders (in contrast to dealing with day traders, high-frequency trading algorithms or other types of activist shareholders). A customer that loves the company’s product might be more inclined to stick around during a difficult patch, for example.
Standard Silicon Valley business model - get as many people on the platform as possible, and then monetize later (probably as a marketing channel, but they also have some other monetization strategies in the works). They batch their transactions, and they are themselves a broker dealer, so their internal per-trade cost is extremely low.
Looks like they are some sort of stock re-selling business of sorts? You can buy partial shares apparently. I guess they work like a fond, that you buy into and pick your own portfolio, basically?
Very few exceptions. Even Google, at $900/share, is not worth the $14 round trip commission. And if your investing in hundreds, you're likely doing it through a bank or some other service will probably costs >= $20/trade. Ouch OP.
I'm not sure they offer it any more (I'm grandfathered in), but Wells Fargo PMA accounts have 100 free trades / year. You do need 50k in total assets with Wells Fargo to get it though.
Still, it's saved me at least 1k over the last 2 years.
Comments
A bit OT financial advice: it's almost never worth it to buy a single share. The reason is the commission will eat you up. Assume a low $7/trade commission. That could possibly cost you $14 round trip (purchase/exit).
With Tesla ~$100/share, It'll have to go up 14% just to break even on the trade. Even if you just buy in single shares but exit in multiple shares to spread the commission, you still have to fade 7% commission. Not worth it.
If you're investing in the hundreds of dollars, you should look for low commission options such as CDs.
Edit: I accidentally replied to the post. My comment was meant in response to this comment. https://news.ycombinator.com/item?id=5904397
(Assuming this was meant as a reply to my comment) - I do understand that, I pretty much just bought a single share to say I had one, and see how it would perform, more as an experiment and out of curiosity than an actual business interest.
This I can understand. It's nice psychologically to be an owner of something.
But this you can do without buying :)
It's so much more interesting when you have something to lose.
Yes. I would've reposted but it already got replies.
I can understand the desire to experiment, just keep that in mind for future trades. Commission can be a killer as you trade more, especially if you trade less than a few thousand dollars at a time.
"I pretty much just bought a single share to say I had one"
Depending on your social circle, this gets done with kids a lot, especially with an old fashioned issued paper share instead of electronic. Decades ago Disney used to have quite an elaborate paper stock certificate for this purpose and they obviously used their professional artists and graphics designers. My local electric company in comparison looked little better than a secretary hand typed it, which might be how they made it... Perhaps they still do this. Its hard to find a corporation worth endorsing to my kids like this.
Also during the first dotcom boom there were at least a couple people collecting paper certificates from dotcoms and they still trade among themselves to this day as collectibles.
Just some interesting ideas to think about / google about.
Ha! At first I thought you meant "done with kids" as some people make'm so they can say they have one.
LOL more like my hippy anti-capitalist protestor friends probably would not find it funny to give their kid a share of GM or BRK.B, or give a share of BP to tree hugger's kids. If I had any friends who were hard core anti-gun, then a share of Ruger for their kid would go over about as well.
A lot of Green Bay Packer fans have shares of the team (they had another stock purchase some years back). It makes for a nice thing to have framed during football season.
At least with Packer shares you know in advance it's not a good financial decision, because they don't appreciate or return dividends. It's basically just a certificate of fandom.
(I still almost bought one though.)
I have one of these from Coca-cola
Ah I see via some google that there are now trading companies set up for this, simply give them some money via CC and you get the cert in the mail already mounted in a frame maybe with an engraved plaque. This takes some of the "fun" out of it.
http://www.giveashare.com/stockcertificates.shtml
Keeping it on topic, you'll be out about $200 for a nicely framed paper share from Tesla Motors, at least from these guys.
Back in the old days, or at least in the 70s, this was a much more complicated manual process where you'd have to call your broker and pay a ridiculous commission and usually a relatively modest (compared to recently...) delivery fee, and then frame it yourself, and possibly engrave a plaque yourself, etc.
Also looks like paper shares are going completely away, which is really too bad, as they were a kinda cool gift idea. From a purely PR perspective you'd think the marketing dept would keep it on life support, at least at some companies, even if it moves out of the finance dept. Perhaps an attractive one page sign declaring you're a shareholder, as opposed to formal legal stock certificates. Maybe it'll all be "mozilla open badge system" instead LOL.
The dotcom collector guys are going to be sad that literally no facebook paper share certificates will ever be issued, for example. All electronic now via the DRS. I was in financial services industry about 20 years ago and I'm astounded it took this long to eliminate paper... Had to wait for the dinosaurs to die off I guess.
Presumably the advice should be "it's never worth it to only buy a few hundred dollars worth of shares", since buying a single share worth $10,000/share is a decent deal (with respect to the commission, at least).
There aren't many shares priced up at that point because there is usually a stock split so that the shares are then more affordable and therefore more liquid.
At the time of this posting, Berkshire Hathaway stock is trading at $172,750.31 per share and Seaboard Corporation is at $2,765.00/share.
Of course, other than those two, I think the next most expensive stocks are in the google/apple $400-1000 range.
Yes, a single BRK-A would be ok :)
Not necessarily, there are cheap $1 brokers like Interactive Brokers. I've used them, they get the job done.
http://www.interactivebrokers.com/en/?f=commission
The comment I meant to reply to was a first time buyer. It's more likely he/she spent $20/trade.
Also slightly OT, but Loyal3 (http://www.loyal3.com) provides fee-free stock trading - both entry and exit. Unfortunately they don't carry TSLA on their platform yet.
How do they make money?
From TechCrunch[1]:
Loyal3 works with publicly-traded companies on creating a Customer Stock Ownership Plan or CSOP. In a CSOP, a company pays the brokerage fees on behalf of the investor because it might want to have more of a connection and more loyalty from its shareholders (in contrast to dealing with day traders, high-frequency trading algorithms or other types of activist shareholders). A customer that loves the company’s product might be more inclined to stick around during a difficult patch, for example.
[1]: http://techcrunch.com/2012/09/12/loyal3/
Standard Silicon Valley business model - get as many people on the platform as possible, and then monetize later (probably as a marketing channel, but they also have some other monetization strategies in the works). They batch their transactions, and they are themselves a broker dealer, so their internal per-trade cost is extremely low.
Looks like they are some sort of stock re-selling business of sorts? You can buy partial shares apparently. I guess they work like a fond, that you buy into and pick your own portfolio, basically?
Unless it's BRK.A ;)
Very few exceptions. Even Google, at $900/share, is not worth the $14 round trip commission. And if your investing in hundreds, you're likely doing it through a bank or some other service will probably costs >= $20/trade. Ouch OP.
I'm not sure they offer it any more (I'm grandfathered in), but Wells Fargo PMA accounts have 100 free trades / year. You do need 50k in total assets with Wells Fargo to get it though.
Still, it's saved me at least 1k over the last 2 years.