Zecco Free Dividend Reinvestment Confirmed
Recently, Zecco started offering equity free trade for customers with $2,500 or more in their accounts. While this news certainly got my attention considering that I am now paying from $4 to $7 for each stock trade, there was one question that I didn’t find answer from their posts: there’s no mention of dividend reinvestment. I even searched Zecco’s website and again came back empty-handed.
The reason I am interested in their dividend reinvestment policy is that one of my ETF holdings, PEY, now pays monthly dividend and I plan to make it a passive income generator that I will hold for years ahead. I used to hold PEY at Scottrade which has a commission of $7 per trade. But the biggest problem with Scottrade is that they don’t offer dividend reinvestment for stocks:
Scottrade does not currently offer dividend reinvestment as an account option. Cash dividends which are paid to your account are automatically swept into an interest bearing cash account.
I switched from Scottrade to FirstTrade in March after PowerShare announced a new distribution schedule for PEY from quarterly to monthly, just to get free dividend reinvestment from them. Since then, I have been investing about $200 every two months. Though the free dividend reinvestment from is definitely a plus, the $6.95 commission made my investment too costly (equivalent to 3.6% fees).
The no-fee trading offer from Zecco could eliminate one of my concerns (right now I am not sure if the free trade is just a bait or permanent), but the absence of dividend reinvestment information from their website prevented me from signing up right away. To get a clarification of the issue, I emailed Zecco customer service yesterday morning (they don’t have a customer service phone number) with my question and last night, I got this reply from Zecco:
Thank you for contacting Zecco Trading. Yes we do offer free dividend reinvestment. Should you have any questions, please refer to www.zecco.com.
Thank you for your interest in Zecco.
Now that everything is clear, I am going to put $2500 and give them a try.
If you want to try Zecco, use the following links to get an account:
|Buy Stocks Online for $4.50||Trade stocks for $4.50 on Zecco.com.||N/A|
|Trade Stocks for Free||Open an account with $25,000 minimum and get 10 trades per|
month commission free.
|Free Blogs, Forums & Trade||Why Invest in stocks? Find out at www.zecco.com for free blogs, forums and trade.||N/A|
|Get 10 Trades Every Month||Get up to 10 free stock trades for free at Zecco.com when making 25 trades|
or more in a month
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