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From: suhre@trwrba.UUCP (Maurice E. Suhre)
Newsgroups: net.invest
Subject: Discount vs Full Svc Brokers
Message-ID: <1223@trwrba.UUCP>
Date: Fri, 11-Jan-85 13:31:53 EST
Article-I.D.: trwrba.1223
Posted: Fri Jan 11 13:31:53 1985
Date-Received: Mon, 14-Jan-85 04:41:34 EST
Organization: TRW EDS, Redondo Beach, CA
Lines: 35

I had an account of about $30,000 with a full service broker 
for about 5 years.  I was only plus one year out of the five.
During that year, I made about $3000, and I paid about $3000
in comissions.  That ratio didn't seem too good to me.  I was
taking their advice pretty much as far as stock selection went.

When I decided to follow Stan Weinstein's newsletter, The 
Professional Tape Reader, it naturally seemed to silly to use
a full service broker.  A friend recommended Kall and Co.
They charged quite a bit less for commissions.  Their charges
seemed to be about 1-1.5% with the full service about 2.5%.
I think Kall has a $30 minimum.  Kall was not quite as good
about interest on the cash in the account (compared to money
market funds).  If you are planning to be mostly in the market,
then this should not be a serious consideration (second order 
effect).

In short, if you are going to make your own decisions and 
don't need your hand held, you can save money with a 
discount broker.  Check around, ask your friends, and
read the charge schedule carefully.

One last item.  A full service broker usually charges quite
a bit more for low priced stocks.  That is, the comission
on 1000 shares of a $4 stock will be more than the comission
on 100 shares of a $40 stock.  Perhaps 4.5% vs 2.5%.  Anyway,
do your own investigation, and I vaguely remember this subject
being discussed in the Money Magazine a year or two ago.

The usual disclaimers about not being an investment adviser, etc.,
and I have no complaints with Kall & Co.

Maurice

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