Topic: Flat Transaction Fees
Correct Answer: #4, $10,958
Take $10,000 and subtract $20 ($10 for each individual stock purchase) at the beginning of the year to get $9,980. Then add 10% to that figure to get $10,978. Then subtract $20 again ($10 for each individual sale) at the end of the year to get $10,958
Remember, you pay the flat fee on the front and the back end when you make the transactions themselves. But since the fees are flat, you have more than you would have if you were charged 1.5% by a manager; remember, the finishing total on Question #3 was $10,850.
Now let’s look at the time element with flat fees….
