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Fidelity Penny Stocks Fees. Fidelity OTC Stocks Trading.


2019 Fidelity Investments penny stock fees: commission charged for buying pink sheets/OTCBB/stocks priced under $1. Rules and policy. Are Fidelity Investments good for (offers) penny stocks trading?



Does Fidelity Offer Penny Stocks?


Yes, traders at Fidelity have access to the over-the-counter market. The broker’s stock screener can search specifically for penny stocks that trade on OTC exchanges. The tool generates 940 OTC equities. The results can be sorted by many criteria, including volatility and price.

Fidelity does not charge anything extra to trade penny stocks, nor are there any special account requirements. There is a warning on Fidelity’s website about the dangers in the OTC market, and traders should definitely be aware of the inherent risks.


Fidelity Penny Stock Fees


Fidelity penny stock commission $4.95
Fidelity penny stock surcharge $0
Fidelity large order surcharge $0
Fidelity ECN surcharge $0

Fidelity Investments charges $4.95 per stock or ETF trade. Along with firms in the Best Penny Stock Brokers list Fidelity does NOT have additional fees and surcharges on Pink Sheets/OTCBB/stocks priced under $1.

There is an assessment of between $0.01 and $0.03 per $1,000 of principal in addition to your commission that is added to sell orders. This assessment is imposed on the financial services industry by the Securities and Exchange Commission to cover the government’s costs of regulating the security markets and security professionals.




Comparison


The ability to search for stocks that trade specifically on OTC exchanges is a nice feature that Fidelity investors receive. E*Trade’s screener, by comparison, does not have the functionality. TD Ameritrade’s screener does have this capability, and it generates over 4,600 over-the-counter securities. Fidelity’s produces less than a thousand.

Fidelity customers can trade OTC equities without paying any additional fees. Other brokers do charge for this privilege. Ally Invest clients, for example, must pay the broker’s $5.95 base charge plus an extra 0.5 cent per share if the stock trades under $2.



OTC Stocks Available at Fidelity


While the SEC classifies a penny stock as any equity trading under $5, most traders put the limit at $1. In either case, there are some equities on the OTC market that trade above $5.

For example, Alerus Financial Corporation is an OTC stock available at Fidelity. Its most recent trade price is $19. The ticker symbol is ALRS. The company is in the micro-cap group, which is fairly common on the OTC market. The stock does pay a dividend, and financial statements are available on the stock’s profile page.

Another example of an over-the-counter security available to Fidelity customers is ANDR. This stock trades below 10¢. Andrea Electronics Corporation has a market cap of just $3.9 million, which is extremely small. It does not pay a dividend, and its average volume is above 40,000 shares per day.



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Trading Penny Stocks on Fidelity Investments


Fidelity Investments customers pay the broker’s normal $4.95 commission for penny stock trades. Orders can be submitted on the firm’s website, mobile app, or advanced desktop platform. Just follow the same procedure as you would with a regular stock. Click on the buy button to enter a bullish position, or the sell button to short the stock.

Keep in mind that while shorting OTC stocks is possible, the downside potential is very limited in most cases, because the entry price is already so low.






Buying Penny Stocks on Fidelity Investments


Once you have decided the penny stock is a buy, it's time to place an order. A stock order at Fidelity can be placed on the broker's website, mobile app, Apple Watch, or Active Trader Pro, the firm's advanced trading platform. In all cases, the basic steps and order types are the same.

On the stock's profile page or chart, click on the trade button. Doing so will produce a handy trade ticket on the website on the left-hand side of the browser. Choose buy in the action menu. Then decide how many shares you want to purchase and type that number in the quantity field. The broker's $4.95 trading commission is per trade for any number of shares. Therefore, it's most cost effective to buy all the shares you want in a single trade.


Fidelity penny stocks


Next, select market or limit order for the order type. Market orders are executed immediately with no guarantee of price, whereas limit orders guarantee price, but not execution. Both order types are the same price. Limit orders are safer, so choose a limit order if you're new to trading. Enter the highest amount you're willing to pay for the stock, per share, in the limit price field. Data displayed on the order form will tell you what the bid-ask spread is and what the most recent trade price is.

The time in force specifies when the order should be filled and what happens it if isn't filled. Day means the order will be cancelled at the end of the trading session if the order isn't filled. GTC means good 'til cancelled. This feature will allow the order to sit in your account up to 180 days until it is completed. Choose whichever type you want. If you choose GTC, don't forget about the order; otherwise the Fidelity system could buy stock in your account 4 months later if the stock price drops below your limit price.


Fidelity investments penny stocks


Finally, click on preview. If all the information looks right, click on place order. Congratulations, you have just submitted an order for stock. In most cases, the order will complete in less than once second. Go to the order status page, and the order will probably already by shown as filled. The stock will immediately be shown as a position in your account.

The steps for selling penny stock at Fidelity Investments (member of FINRA) are the same as for buying. First, you want to do adequate research to determine if it's a good time to take some shares of a position off the table. After reviewing analyst reports, the news, charts, and financial statements of your current stock, and you decide that it's now overvalued, it's time to sell. Go through the same steps outlined above to fill out the order ticket. If you place a limit order on the sell side, remember that the limit price is the lowest amount you're willing to accept, rather than the highest amount you're willing to pay.


Pink sheet stocks Fidelity