stock brokers

I guess after this years events ..many people are a lot less confident about this.BUT THE TRUTH IS THEY NEVER REALLY WERE!...Stockbrokers are like any other business..their main objective is to make money.They sure spend a lot of money on "feel good" TV ads that rival the pablum from the insurance companies..."Nationwide is on your side" .pleeeeeeze..tell that to the people still waiting for their insurance checks from Katrina.Similarly, Charles Schwab is not there to make sure you make money!.In fact they really are not all that interested as long as the commisions and fees keep rolling in.I will quote one simple thing to check that is often overlooked. If you plan on trading in your brokerage account you will most likely be wanting a margin account.Leaving aside the question of if this is a good idea[hint=risky],the SEC regulates the minimum margin requirements that stockbrokers must charge for various kinds of securities loans[this is what margin is..a loan against the equity in your account].The current minimum is 25%.What most people don't know and brokers never tell you...is, there is no maximum equity requirement and there is no requirement that brokers charge the minimum.So taking Charles Schwab as a example..The margin requirement for stocks over 5$/share is 30% at Charles Schwab.What that means if you buy 1000$ worth of stock you must keep 30% of the ammount or 300$ to maintain the position...If the stock declines in price you will of course have to add money to meet the 30% test...so what does this mean?.It means if you do business with this company your margin loan will cost 5% more every month you maintain a stock in your margin account,and worst of all you will be 5% more likely to get a margin call.In todays volatile markets this is bad..as margin call are likely.Do not confuse this with the margin interest rate which is quoted like a loan 7% 8% etc.It can be the case that a broker will lower the interest rate while at the same time raising the margin equity requirement from 25% to 30% or more...Deceptive? yeah but all legal..do your homework! Learn more about Brokers here and know where to check for a sqare deal!