Zecco’s New Commission Plan: $25,000 Balance Required Free Trades

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Zecco just sent out a message to their account holders – Starting March 1st, to qualify for 10 free stock trades per month, you need to have an account balance of $25,000 or more. This is a ten-fold increase from their prior requirement of $2,500, which was itself an infinite increase from their initial offer of unlimited free trades. Another way to get ten free stock trades is to have 25 or more total trades a month, which cost $4.50 a trade.

When your balance gets above $25,000, you immediately get ten free trades you can use until the end of the month. Should your balance fall under $25,000, then you still retain your ten free trades until the rest of the month. With the 25 trades qualification, once you make 25 trades, you get ten free until the end of the month. That next month, you get ten free trades to start and need only 15 more to retain the ten free trade status for the following month.

Zero Cost Commissions, the meaning being Zecco, is slowly losing its meaning. It used to to be unlimited free trades. Then it was lowered to ten free trades if you had a $2,500 balance. Now it’s ten free trades if you have a $25,000 balance or if you make 25 trades ($112.50 in commissions). If all things were equal, I’d say that Zecco gave a pretty good offer, but things aren’t equal. Zecco has consistently been rated as worst in customer service! Smart Money’s 2008 Best Discount Broker survey rated Zecco 14th out of 16 and there are a slew of negative comments about Zecco’s customer service. This is amazing considering TradeKing, rated amongst the best discount brokers, has had stellar reviews and they charge only 45 cents more per trade, only $4.95 a trade.

Here’s the image explaining their new balance qualification rule:
Zecco New Pricing - Balance Qualifications

Here’s the image explaining their 25 trades qualification rule:
Zecco New Pricing - 25 Trades Qualification

I wonder if Zecco will have to change their name to Zecco*, just to cover all the special rules they’ve added to “zero cost.”

{ 8 comments, please add your thoughts now! }

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8 Responses to “Zecco’s New Commission Plan: $25,000 Balance Required Free Trades”

  1. nickel says:

    25 trades is $112.50 in commissions, not $123.75 (you multiplied by $4.95 instead of $4.50).

  2. thomas says:

    It’s NetZero all over again!

  3. Chuck says:

    25 trades is $67.50, because 10 of them are free.

  4. Jim says:

    They’re not free the first time through.

  5. Peter Seed says:

    That makes OptionsHouse low cost leader at $2.95 per trade for up to 50,000 shares. Options are flat-rate, too, regardless of numer of contracts.

  6. Swamproot says:

    I am so pissed. I JUST got a $2500 balance with them and now I get this notice. Why not a graduated free trade thing, like 1 free trade with a balance of 2500, 2 free trades with a balance of 5000, etc. Why did they have to increase it ten-fold? I was even thinking of opening an IRA with them. Not anymore.

    I’m seriously going to look into SogoTrade.

  7. Start-Up says:

    It’s such a shame that they made such a significant increase in the account value necessary for free trades. If they don’t step it up in customer service and investment tools they will most likely go out of business.

  8. saver says:

    as of feb, 2009, sogotrade offers 100 free trades if you open a new account with $500 initial deposit. commission is $3.

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