by Jenny Ruth
Tuesday 14th March 2006
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The change will mean clients will pay a minimum $30 per trade or 0.3%, whichever is the greater.
For most customers, the increase will effectively be a 55 cents increase per trade.
Those most adversely affected are those wanting to trade parcels worth between $10,000 and $30,000 - instead of paying a flat $29.45 per trade, a $30,000 trade will incur a $90 brokerage charge.
Lower professional brokerage rates are available to high value clients.
Preston says that previously trades in the $10,000 to $30,000 represented an anomoly or loophole - some clients had been taking advantage of it by breaking up larger trades into smaller parcels to secure lower charges which meant a great deal more work for the firm.
"We believe its still a very competitive rate," he says.
ASB is one of only three broking firms offering internet trading in New Zealand. National Bank offers a service through First NZ Capital and it currently charges a minimum $29.50 for trades up to $10,000 or 0.3%.
The other firm, Direct Broking, offers significantly lower charges for trades above $10,000. It charges a flat $29.90 per trade up to $25,000 and 0.2% thereafter.
Preston says he isn't interested in whether others offer cheaper services. "We don't even look at what our competitors are doing." While they may be cheaper, ASB can draw on the security of its parent bank, Commonwealth Bank of Australia, to offer clients greater safety, he says.
Between September and the end of February, ASB accounted for 11.2% of all stock exchange trading while Direct Broking accounted for 7.1%, he says. National Bank's figures are included in First NZ Capital's which has the largest market share.
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