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Old Aug 16th, 2012, 04:57 PM   #1
losemind
 
 
Join Date: Dec 2010
Posts: 75
I am thinking of opening a Fidelity account:

And I am reading the restrictions for Commission Free etfs...

It's kind of hard to understand...

Anybody please help me understand their restrictions?

Thanks a lot!

http://personal.fidelity.com/product...aq-popup.shtml

Are there any restrictions on the commission-free ETF trades?
The commission-free trades on the 30 iShares ETFs must be done online at Fidelity.com, Active Trader Pro, Wealth-Lab Pro, or through Fidelity's wireless channels. Commission-free trades apply to all buy and sell transactions on eligible iShares ETFs. All iShares ETFs are not margin eligible for 30-days from settlement, similar to mutual funds. For margin customers, positions will automatically become margin eligible in their account after 30 days from settlement.
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Old Aug 16th, 2012, 05:15 PM   #2
TheGoonior
 
 
Join Date: Oct 2009
Posts: 873
From my understanding, they aren't commission free if you phone it in (i.e: broker assist).

I do it all the time in my Fidelity 401k from the long side and it works just as advertised.
I'm not sure about the short side, though.
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Old Aug 16th, 2012, 05:25 PM   #3
losemind
 
 
Join Date: Dec 2010
Posts: 75
Thanks!

I just don't understand the last 2 sentences regarding margin and settlement:

All iShares ETFs are not margin eligible for 30-days from settlement, similar to mutual funds. For margin customers, positions will automatically become margin eligible in their account after 30 days from settlement.

Could you please explain?

Thank you!
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Old Aug 16th, 2012, 05:59 PM   #4
heywally
 
 
Join Date: Jul 2007
Posts: 154
My understanding of that is that the money received after you sold shares in one of their commission-free ETF's could not be 'margined' until 30 days after settlement. Give them a call for clarification.

I have an IRA with them which is not marginable so that restriction is not applicable to me. I use this particular IRA at Fidelity to mainly conservatively scale-in to the market via several of their comm-free ETF's, in very small quantities on a daily basis and then scale-out into strength. I like IVV and IWM. Because the share quantities are so small, I can feel good about a zero commission applied many times. There is no way I'd run this strategy paying any regular or even discount commissions.
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Old Aug 16th, 2012, 06:32 PM   #5
icymonsters
 
 
Join Date: Jan 2012
Location: CT
Posts: 10
you can also short for free. TIP and IJH seem to be the only etfs out of the 30 with shares available
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Old Aug 16th, 2012, 09:41 PM   #6
losemind
 
 
Join Date: Dec 2010
Posts: 75
Quote:
Quote from icymonsters:

you can also short for free. TIP and IJH seem to be the only etfs out of the 30 with shares available
oh not many etfs available for shorting?

that's too bad!
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