NYSE (New York Stock Exchange)
Asked on 14 Apr 2020
What are some costs that I should be aware of?
Hi Michelle, it's nice to know you're looking to kickstart your investment journey. On top of what has already been mentioned, specifically for ETFs, you could also consider Irish domicilied ETFs. They are more cost efficient with their 15% withholding tax on dividends, compared to 30% for those listed in US.
Examples of these ETFs listed on LSE include:
CSPX - iShares version
VUSA - Vanguard version in GBP
VUSD - Vanguard version in USD
VUAA - similar to VUSD, but the dividends are reinvested automatically instead of being paid out. This would be useful if you are looking to invest for the long term.
Hi Michelle, there's no hard-and-fast rule on this. It all depends on your comfort level.
I like to keep the commission fees to around 1% of the investment capital. For example, if the commission is $10, I would like to invest at least $1000 to make it worthwhile.
Yes, there's a 30% dividend withholding tax involved. Other costs will depend on the broker such as custodian fees, etc.
The minimum lot you had to buy is one stock.
The beauty of the US stock market is its low fees and low minimum investment.
Ill say $500-600 (2x SPY) to start is the minimum.
If your a bit lower, consider evaluating a company on your own, and put your entire capital (300-500?) in it.
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