Zecco Promotion: Lowers Account Minimum, for now, but Keeps the News like a Secret
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Early last week, a post on Money, Matter, and More Musings reported that Zecco the commission-free online brokerage firm, is running a promotion with lowered account minimum from $2,500 to $1,000. That seems to be a good news for small investors who can’t meet the initial deposit requirement. In fact, the $2,500 minimum is the highest among several brokerages as shown on their own website. I then went to Zecco and found on the website they still have $2,500 as account minimum.
After an email inquiry about the change last week didn’t get any response, I called them this morning asking for a confirmation. What they told me was, yes, there’s a promotion going on right now till the end of April that you can open an account for only $1,000, and yes, they didn’t put the information on their website. When I asked the CSR why I can’t find the promotion on their website and if it’s a promotion that aimed to get more customers, why they kept the news like a secret, he told me they don’t update the website very often (yes, that’s what he told me) and the reason they didn’t announce it was they don’t know if the change will be made permanently or not. There will be an announcement once they decide they can live with the $1,000 minimum. For now, if you open an account before May 1st, you can get a lowered account minimum.
Now what does Zecco try to say with this promotion? It could signal that they have enough deposits already so they can afford to lower the bar to let more small investors get in. Or it could also mean they didn’t get enough money to keep offering fee-free trading so lowering the requirement can attract more investors, thus more deposits.
I have been considering to open an account with Zecco for a while, but never turned it into action because I am not sure whether Zecco can maintain their current fee structure. It’s nice to buy stocks for free. But if they change their mind later and start to charge commissions, it probably won’t benefit too much to keep an account with them. In that case, selling the position and closing the account aren’t the things I want to do. I am taking a wait-and-see approach with Zecco.
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- Pingback by Merchant Accounts » Zecco Lowers Account Minimum, for now, but Keeps the News like a … on April 16, 2007 @ 9:35 pm
- Pingback by Secret promotion at Zecco, sign of bad times? at ProBargainHunter.com on April 17, 2007 @ 11:41 pm
- Pingback by Is DRIP still Worth the Effort? | The Sun’s Financial Diary | A Personal Finance Blog on Saving and Investing on April 19, 2007 @ 11:21 am
- Pingback by Zecco Eliminates Paperwork in Account Application | The Sun’s Financial Diary | A Personal Finance Blog on Saving and Investing on May 16, 2007 @ 1:52 pm
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- Pingback by Zecco Removes Account Minimum to Lure More Investors | The Sun’s Financial Diary | A Personal Finance Blog on Saving and Investing on June 5, 2007 @ 2:49 pm
- Pingback by Zecco Scales Back Free Trading Offer | The Sun’s Financial Diary | A Personal Finance Blog on Saving and Investing on October 2, 2007 @ 10:57 am
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Your opinion matters. Please use the form below to share your thoughts on Zecco Promotion: Lowers Account Minimum, for now, but Keeps the News like a Secret with us.Recent Entries
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You won’t have to sell if the worse happens. You will still hold your shares. You’ll just have to go through the broker who bought the shares for you via Zecco: Penson Financial.
I tried to open an account and was finally rejected with no reason whatsoever. What really annoyed me though was the fact that Zecco kept sending me emails to Open a new account. Lol! They rejected me with no reason and then they kept pestering me to open an account.
Zecco’s problem isn’t account limits, it’s horrible customer service but you’ll find that out very quickly when you try to open an account.
I am still hesitant if I should give them a try. I guess one can say I become conservative as soon as $1000’s get involved.
I am not confident about their business either. In my opinion commission free trading should attract lots of investors, but this low account minimum promotion doesn’t seem to support the assumption. Beside, when I can called for details about the promotion, I wasn’t really impressed by their customer service. First I was put on hold for quite some time, then during the conversation, the CSR had to check back a couple of times to get an idea what their promotion really is.
Michelle: Actually, what I meant was if Zecco starts to charge fees for trading stocks, I don’t think their fees will be lower than other brokers that charge $3.00 per trade. In this case, I don’t have any reason to keep an account with them. If I do close the account, then I may have capital gains and have to restart the purchase with another broker. This is what I don’t like to see.
I sent an email to their customer service and I got reply from them dated May 18,2007 that I can open with a minimum of $1000. Also with their recent paperless application that might be a sign of improvement in their system. I know they were pretty backed up in the month of April being an IRS month.
Do not do business with Zecco! Your mistrust is not misplaced.
They are not adhering to the policies posted on their Web page, and every aspect of their customer service I have dealt with has been either stupid or rude. They waited until after I funded my account to tell me that they had frozen my account (opened 8/8/07) because they had not received my paperwork (the paperwork their Web site says doesn’t exist for customers who opened accounts after a date in May).
I contacted Penson financial, the company who they had the nerve to put ALL of the blame onto, and they informed me that it is illegal to have an account without paperwork. They are now holding my money hostage until I return the phantom paperwork that Zecco allegedly provided to me. They refuse to let me close my account and transfer the money back into my checking account until I send it back in.
Penson financial’s head compliance officer contacted Zecco’s head compliance officer, Joe Chung, who promptly called me directly and chewed me out for calling Penson. I told him that I don’t have any paperwork, and he says that Zecco sent me an e-mail (which they didn’t, I checked my SPAM box to be sure). He was so nasty, that when I asked for his name, he gave it to me, then said “I don’t know who else you’re going to talk to, though, because I’m the highest there is.� I hung up on him, and called Penson back. Apparently they’re getting a lot of complaints about Zecco’s questionable business practices, and it seems they’re fed up.
Horrible, Horrible service. Their website needs lots of work! You get what you pay for. I attempted to cancel an order and it wouldn’t let me. I placed a new order and it never appeared on my screen but when I called, it was on their screen. Multiple problems with their trading platform. My advice STAY AWAY FROM ZECCO!!!!!
Free trades are for stock only not options.