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Author: TMFPixy Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75777  
Subject: Re: Need Advice! Date: 7/8/1997 5:07 PM
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Yo, Dave.

<<Another thing I'm having trouble with.... If someone only has a small amount of money to get started, say $2,000, and wants to do the Foolish Four strategy -- is it possible to just purchase a few shares of each company?? I thought most brokers required you to purchase round lots of 100 shares, otherwise you pay more per share or something like that. The reason I ask is because I'm starting my first online brokerage with $2,000 (with E*Trade), and I'm trying to figure out how all this stuff works... >>

Well, you're going with a discount broker (good! .... it keeps your trading costs manageable), so you won't have to worry about odd-lod trading. Purchase one share or 62 or 543, and they will each cost you a flat sum. I don't remember what E*Trade charges ($9.99, $12.99, $24.99), but they're definitely reasonable. What you want to ensure is that you keep your costs to no more than 2.5% of your portfolio. At 2K, that means about $50 for the year. Depending on the cost per trade, you could get into the Foolish Four for about $40 up to $100. The latter means your initial purchase should be about $4K, not $2K.

Regards......Pixy
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