That's Insane

Said Snork Maiden. This was when I told her the difference in commissions between trading a stock index futures contract on the Sydney Futures Exchange through Interactive Brokers and trading the same nominal amount of actual Australian stocks at the lowest online rate offered by Australia's biggest online brokerage. $A5 vs. $A186. The latter reflects trading $A155k of stocks at a 0.12% commission. Going short through the latter broker involves additional commissions. Another way to significantly lower costs is to trade warrants (options on stocks issued by investment banks that trade like stocks on the ASX) or options rather than actual stocks. Because the face value is much lower you pay less commission. But you can't always get the exact warrant you want and trading options requires phoning a broker and paying much higher commission rates.