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Bank of America Offering Free Trades

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If you have over $25,000 combined in any of your Bank of America accounts then you’re in luck, you now qualify for thirty free trades a month from Bank of America. The only downside is that depending on what the rate of interest is on those accounts (let’s say 0%), you could be surrendering as much as $1,250 per year if that money were deposited in an high yield savings account at 5%.

When David tipped me off to this via email (Thanks David!), I first thought this was a great idea on the part of BoA. First, you hop on the heels of Zecco (they just introduced advertising supported free trades). Second, you get people to give up earning $1,250 in interest (if they go with a 0% checking account) in return for 360 free trades a year (valued at $1,800 to $3,600 a year).

How many people commit thirty trades in one month? Ignoring the fact that it may be indicative of a poor investment strategy (buy-and-hold is hard when you transact thirty times a month), thirty well-informed intelligent trades is a lot for someone who has a full-time job.

Hopefully people who want to take advantage of this can count Certificates of Deposit account balances as part of the $25k because Bank of America has a 5.00% APY High Yield CD and then the trades are truly “free.”

Source: Bloomberg (Thanks David!)

{ 6 comments, please add your thoughts now! }

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6 Responses to “Bank of America Offering Free Trades”

  1. Chuck says:

    Bank of America also has a high yield AAA Cash Maximizer Savings account that pays 5.11% APY on balances from 10k-50k (5.37% for balances over) which I am pretty sure count towards the 25k min balance as well.

  2. JM says:

    To add to what Chuck says, if you are a member of NEA, the deal is even sweeter. I think it’s 5.37% for balances over $500. And you get a 60 day promotional rate of 6.37%

  3. Marshall says:

    This is big news! Bank of America is the first major financial institution to offer free trading. Zecco.com also offers some free trades, but it is still relatively new. Hopefully other banks will follow. Hopefully this will make the stock market more accessible to small investors myself.

  4. zook says:

    I just wanted to add in with what you guys were saying…All its takes is a simple phone call to BOA to increase your interest rate on your savings account…

    They aren’t going to be proactive and tell all of their customers that they will now bump their interest rates up, which stinks but thats the world we live in, but when the CUSTOMER calls, they do help you fit into a better account with better rate…

    I had a large sum of change sitting in one of my savings accounts with them and it was like .50% a YEAR…I then made a call and they got me up 3.50% just by calling…Not great, but a substantial increase/…

    Now that I heard about 5.11% I will be making another call as well… :o ) Thanks guys…

  5. Fotuton says:

    As far as the 30 trades per month not being conducive to a sound investment strategy…think about this! Dollar cost averaging. It’s like having Sharebuilder but without the pesky fees. i’m pretty sure you can get a decent portfolio of stocks a la Sharebuilder without having to pay their $4 or their subscription fees. Now, THAT is a deal!

  6. jt hobbs says:

    what if you’re like me, and don’t have the $25k and can’t get free boa trades. would you still take a chance with zecco?


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