"My former firm taught people to tell customers that the commission generally runs about 2.5 percent for an equity investment. So, for a relatively small equity trade of $10,000, you will pay about $250."IMO, the only reason some people are willing to pay ridiculous fees like that is because all the advertising the big brokerages pump out convinces people that the "pros" are going to help them beat the market. Almost none of them do even before fees. After fees I'd be surprised if 1 broker out of 1000 beats the market. Is he helping you get into an investment that you couldn't buy on your own for $10 at a discount broker? For a 2.5% fee I'd be demanding that they refund all fees unless I get returns of greater than 15% on a consistent basis. If they won't do that then it's a ripoff.My commissions range from a max of about 0.2% for a small $5,000 trade to a low of about 0.01% for a $100,000 trade with a flat commission of $10. A few dollars more or less for a flat fee are easily overlooked based on how well you like the trading platform, research, execution times, etc but I'd say anything above a flat $20 per trade is just throwing your money away. Even at a discount broker you're shooting yourself in the foot if you're making tiny little trades at $10 a pop. A $10 flat fee is still a 2% commission if you're making a $500 trade... I'd recommend never making a trade smaller than $2500.If you're the type that doesn't want to have to think about your investments, just pick about 3 or 4 index funds with low fees and good track records covering a diverse mix of investments, split your account up across these funds, and don't worry about it anymore. My 401k is evenly split between an S&P 500 index fund, a Russel 2000 small cap index fund, and an East Asia index fund. The East asia fund was the only option for foreign investments and I wanted some exposure to non US investments. I'm consistently getting about 9-12% per year (not counting the company match) with very little volatility and almost zero effort involved. I check it about twice a year to tweak my contribution levels so I'll hit the cap with my last paycheck of the year.My other accounts I manage myself and average more like 20-50% per year but that requires a lot more research, a lot more trading, a lot more risk, and involves a lot more volatility. My more conservative 401k allows me to sleep at night when my other account suddenly drops by 20% or more in a bad month. It also gives me the courage to "double down" when the blood is running in the streets. That second part is what provides most of the outperformance for my second account.
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