Discount Online Broker vs Full Service Broker

[ENP]

I'm currently with ASB Securities. It's pretty handy and I do most of my own research.

However, I've been looking at the likes of Forsyth Barr, Craigs Investment Partners, etc.

What is the benefit of going with one of these guys instead of a discount broker? What other services exactly do they offer? What are their prices?

I've looked on their websites but they don't go into any details at all.

[Joshuatree]

Hi ENP Im with Craigs but planning on setting up an account with ASB ,Etrade or another to trade withas opposed to just invest with.

I find craigs great for the long term investor.Very Conservative with good research on prominent NZ stocks, bonds and selected overseas stocks. BUT generally 1%(or more for newbies) commision on buys and sells. An annual fee for holding overseas shares in safe custody. Their overseas cash management accounts are great so when you buy some say Aussie shares payment is taken out of your int paying $aus account, simple and efficient.
I was offered Steel and Tube shares for $2.05 last year in a placement which was an instant money maker so these come along from time to time. They're pretty good with bond info. Your accountant will love the end of year records craigs will send you /them(may depend on whether craigs manage your investments or how much buying and selling you do to get this) hence cheaper accountant fees, DOWNSIDES
They are very conservative and i doubt if you would outperform any benchmark following their picks exclusively ,(your money maybe safe however)..... No live platform to see what your shares are doing in real,time or see mkt depth , vol etc , so you cant just hit a button and buy/sell in an instant. My broker is very helpful and sends me screenshots but it aint the same. That commission of 1% can add up fast whereas flat fees of what? $30 etc with online brokers allows you to bail in or out of a stock with minimal losses/ charges. Psychologically thats blockages removed and efficiencies improved in your strategies/ tactics. My plan is to keep craigs but have a trading portfolio to keep clarity between investing and trading so my accountant and IRD see the division and i can test myself out with some trading ,(not micro), but I'm not there yet.Tips on doing this welcome :),

[CJ]

So seems so far the pros are:
- better research, more in-depth
- access to fund-raising/IPO's
- more access to overseas stocks

And the cons are:
- higher prices
- no real-time info
- Less flexibilityI just use ASB for my account (use margin lending so have their Nominee account) and am trialing Sharesight this year for performance reporting/accounting.

What I miss is the access to fund-raisings. Placements like the STU mentioned above would have been a no Brainer.

[percy]

I use Craigs.Australian cash-management a/c means I can deposit dividends and have clear funds within 3 days.This is better than 6 weeks with Westpac.I use the cash management a/c to take up Aussie SPPs and any rights issues.Saves a great deal of hard paper work.Easy to transfer funds from NZ a/c to Aussie.
I no longer invest in UK or USA,so no need to use custodial services.All shares in my/wife's name.
I have access to their research,and my broker will look for research on any company I want to look at.My broker is a very straight shooter,who has helped me a great deal for a number of years.
Costs of dealing are high,however access to new issues/placements quickly cover those costs.
Like Joshuatree I have thought of using a discount broker for trading,but am trying not to trade,so have put it off.

[CJ]

David B - What that probably reflects is that each Broker calls their biggest client first and then goes down the list till the allocation is sold out. So your extended family member may be a bigger fish than your sister but is in an extremely big Pond whereas your sister is a small fish in a small pond.

As I would be a small fish in a big pond, I see no benefit in gong to a full broker yet.

[ENP]

So seems so far the pros are:
- better research, more in-depth
- access to fund-raising/IPO's
- more access to overseas stocks

And the cons are:
- higher prices
- no real-time info
- Less flexibility

I enjoy doing my own research on companies and ASB Securities provides an AUD account where I put my dividends into.

So far, doesn't seem to be any reason to look at going full service.

Thanks for all the tips.

[Dej]

Yeah, research is fun, can never get enough knowledge. My work involves research and my second "job" (the sharemarket) does as well. In my down time I'm usually studying and learning as well through books and internet etc. Can legitimately be called a geek I guess!

http://www.chumpysclipart.com/images/illustrations/xsmall2/2564_picture_of_a_moose_at_a_desk_writing_and_wear ing_glasses.jpg

;)

[Joshuatree]

Yes Sparky that is a real bonus , all the paper work their systems do for us as well as doing the paying for issues, cap raising; banking $US and English divs electronically. God i remember the times i spent 15 mins banking foreign checks for sometimes piddly amounts.