Brokerage Fees: The Charges That Are Easy to Miss
Free trading is not free. The revenue moved somewhere less visible.
At a glance
Figures checked 1 Sep 2026
Expense ratio
Watch the cash sweep rate as much as the trading commission
Minimum investment
Usually none at major US brokers
What to take away
- Uninvested cash swept to a low-rate account is the largest hidden cost at some brokers.
- ACATS transfer-out fees commonly run $75–$100, and the receiving broker often reimburses them.
- Mutual fund transaction fees still exist for funds outside a broker's no-fee list.
Zero-commission trading shifted broker revenue to less visible places. None of them are scandals; all of them are worth knowing about.
| Charge | Typical | Avoidable? |
|---|---|---|
| Cash sweep spread | Broker pays you well below market rates | Yes — move cash to a money market fund |
| Account transfer out | $75–$100 | Often reimbursed by the receiving broker |
| Mutual fund transaction fee | $0–$50 | Yes — use funds on the no-fee list |
| Margin interest | Varies, often high | Yes — do not borrow |
| Paper statement fee | $1–$5 | Yes — go electronic |
If you hold a meaningful cash balance at a broker paying a fraction of a percent while money market funds yield near short-term rates, that gap is a real annual cost you can fix in one transaction.
Common questions
It funds commission-free trading and is disclosed. For a long-term investor buying broad funds the execution impact is minimal.