There are several fees that can be associated with trading stocks, including the following:
Commission: A commission is a fee that is charged by a broker for executing a trade. The amount of the commission will vary depending on the broker and the type of account you have.
Spread: The spread is the difference between the bid price and the ask price of a security. When you buy a stock, you will typically pay the ask price, while when you sell a stock, you will receive the bid price. The spread represents the difference between these two prices and is effectively a cost of trading the stock.
Slippage: Slippage is the difference between the expected price of a trade and the price at which the trade is actually executed. This can occur when there is a large difference between the bid and ask prices or when there is a lack of liquidity in the market.
Financing costs: If you hold a stock overnight, you may be required to pay financing costs, also known as a "carry charge" or "rollover fee." These costs are based on the interest rates of the currencies in which the stock is denominated and are typically only applicable to leveraged trades.
Inactivity fees: Some brokers may charge a fee for accounts that have not had any activity for an extended period of time. This fee is intended to cover the costs of maintaining the account.
Other fees: There may be other fees associated with trading stocks, such as fees for paper statements or wire transfers. It is important to carefully review the fee schedule of any broker you are considering using to ensure that you understand all of the fees that may be applicable to your trades.
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