I'm trying to figure out if I'm getting a straight story from E*Trade. Based on a post on this board, I thought that I could buy foreign stocks through E*Trade at the regular $9.99 commission rate. But what I was told when I tried was that for $9.99 I could only buy OTC versions of the foreign stocks, offered by a market maker affiliated with E*Trade. The guy I spoke with seemed a little unsure of some of his facts, so I hoped that someone on this board might be able to provide additional info.I wanted to buy two foreign stocks, one trading in Toronto, one in Paris. If you want to check them out yourself, they are the "Eveready Income Fund" (Yahoo quote EIS-UN.TO), and Pernod Ricard (RI.PA). I phoned E*Trade and was told that I had two choices. E*Trade offered an OTC option to buy the stocks in US dollars through a market maker. EISFF and PDRDF are the respective tickers. If I bought the stocks this way, I could buy them online and pay the usual $9.99 fee. Alternatively, if I wanted to buy them direct, I could be connected with a broker in Paris or Toronto who could place the order directly, but then I would have to pay a "Broker Assist Fee" estimated as $45, and also would have to deal with currency conversions. The OTC offerings in both cases had bid/ask spreads that were much higher than those of the underlying exchange. eg. the bid/ask for the Pernod Ricard was about 0.1% of stock price on the exchange, and 0.75% on the OTC market maker quote. So on a complete cycle of buying and selling the stock, using say $10,000 as the principle amount, I would expect to lose the 0.65% difference in the bid/ask by using the OTC version, which is about $65. But I would save 2 * $45 broker assist fees or $90, and I would save any currency conversion spread between E*Trade buy and sell rates (I'm assuming E*Trade has a buy/sell spread on currency exchange, but I didn't confirm that). So I decided this time to go with the OTC option, but I'm not very happy about it since it is clearly more expensive than the $9.99 foreign trading that I had hoped for.Has anyone found a better way to do this, either with E*Trade or another broker?
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