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Capital One ShareBuilder Review

Updated August 2014.

I’m not a frequent stock trader. The closest I’ve been recently to stock trading is participating in a $1,000 investing competition with some colleagues this year. With my long-term view of investing, looking at stocks every day and executing costly trades does not make sense for my approach to my own finances. My overall strategy does not involve trading stocks or ETFs, timing the market in search of better returns. That being said, once in a while, I set aside a relatively small portion of money to test some theories.

Here’s an example where I actually did try timing the market. After Toyota announced a recall a few years ago, I purchased about 10 shares of its stock, with the thought that the recalls were temporary problems that shouldn’t significantly affect the overall value of the company over time.

The stock price has recovered since then, but after the fee to buy the stock, a year later, I was only about $20 ahead. If I had to sell then and pay another transaction fee, my profit would be even less. These fees cut into profits and should be minimized as much as possible. If you want to play in the stock market, it makes much more sense financially to use a discount brokerage than a full-service operation, due to the smaller fees.

The accounts that hold my small investments in this company, as well as similarly small investments in an ETF and two other companies, not to mention the money used for the “Grow Your Dough Throdown” competition, are held at Capital One ShareBuilder. Here’s my review of experiences with Capital One ShareBuilder.

Opening the account

It has been many years since I first opened my account at ShareBuilder. I did so before the company was acquired by ING and later Capital One. ShareBuilder offered a variety of bonus codes to invite new users to join. In fact, they allowed the same individual to open several accounts, earning a bonus for each. The Internet went crazy, and there were reports of people opening as many as 50 accounts, earning a $25, $50 or $75 bonus for each account. This was apparently, not against the terms of use, but some customers who took excessive advantage of the offers were asked by the company to consolidate or close their accounts.

ShareBuilder still offers some deals for new customers:

  • A $50 bonus after your first trade in a brokerage (not retirement) account if you open the account by the end of this year and initiate that first trade by February 17 next year.
  • A $50 bonus if you open up your first IRA and deposit at least $5,000.
  • Up to a $600 bonus if you open a new account with the promotion code 14GET600M and make a deposit. You need a net deposit of at least $125,000 to qualify for the full $600 bonus.
  • You can reduce the fee for opening a 401(k) account by up to $75.

You’ll need to check the ShareBuilder website for the full rules for qualifying for any of these bonuses.

The typical personal information is required when you apply for a discount brokerage account with ShareBuilder, but current customers of Capital One 360 will have a streamlined process where some of their information is ported directly.

Transaction fees

ShareBuilder Rveal 300x250 BannerMany discount brokerages offer roughly the same set of tools. Each company may have a few bells and whistles, but for the most part, this type of service is a commodity. Many of the resources offered by discount brokers, like charting and analysis tools and access to some analyst reports, can be found in other locations for free. When it comes down to it, the most important aspect of a discount brokerage is the cost. Paying a $20 fee to sell $100 worth of stock immediately and significantly cuts into any profit you may have had or amplifies a loss. For this reason, look carefully at all the costs involved in buying and selling.

ShareBuilder has simplified its membership tiers. Today, all customers pay the same fees.

Online trades cost $6.95. So you pay this when you place an order to buy or sell shares of a stock or an ETF. So you pay both when you buy and when you sell.

Automatic investments — when you tell ShareBuilder in advance to buy or sell investments on a set schedule — cost $3.95 per investment. You can avoid this fee if the investment is a no-load, no-transaction-fee mutual fund. Other mutual funds, if you don’t buy them through an automated plan, will cost $19.95 per online trade. All trades placed over the phone cost $19.95 each.

If you use ShareBuilder’s “PortfolioBuilder” service, you can set up your entire portfolio for $18.95.

Real-time trades are executed as soon as possible after you place the order. Automatic trades are less expensive because they are bundled together with other customers’ automatic trades and effected only once a week. In other words, ShareBuilder gets the benefit of combing your sale of 30 shares of Microsoft with another investor’s purchase of 30 shares on Microsoft. ShareBuilder does not need to go into the open market to settle these trades, so everyone gets a better price, including ShareBuilder who still collects the same fee as they would with other automatic trades.

Capital One ShareBuilder offers real-time market orders, limit order, stop-loss orders, and several types of options. Some customers might also qualify for margin trading.

One of my favorite features is the lack of an inactivity fee. Most brokers want to make money off of you, which they can only do if you trade. The more actively you trade, the more money the broker earns from you. When they are not earning money from you through trades, many companies want to find other ways to make holding data for you on their servers worthwhile. That’s the beauty of the inactivity fee from the broker’s perspective. Active trading is not generally a sound investing strategy, so buy-and-hold investors are discouraged when charged a fee just for leaving an account open. Perhaps it’s wrong to assume that any company should hold money or investments for free, but since some do, those who charge fees appear to be unfair.

As long as there still are brokers who don’t charge fees for an inactive account, I’ll continue seeking them out for my business.

None of the above can be said without pointing out there is another important fee that often goes unmentioned: the account transition fee. If you decide to close your account and transfer your investments to another without selling and triggering tax ramifications, Capital One ShareBuilder does charge a $75 fee. If you’re not closing your account and transferring only a portion of your assets, the charge will be $15 per security, up to $75. So this “back-end” fee ensures you can’t leave the brokerage for free. Either you sell your investments, generating transaction fees, or you transfer your investments out, generating termination fees.

Linking accounts

A nice benefit of having an account with Capital One ShareBuilder is the ability to link your Capital One 360 savings and checking accounts with your ShareBuilder account. This ensures that you can easily and quickly transfer money from your ING Direct account whenever you want to trade, even if you don’t have cash in your ShareBuilder account. You can link other bank accounts as well, but this “Express Funding” service costs $6.95 plus the regular transaction fee if your linked account is not held at Capital One 360.

Sometimes it’s better not to have cash available because you’re prevented from making rash purchasing decisions. Active traders or those who want to aim for a certain time on a certain day do not need to worry about having cash in their ShareBuilder account if they are a customer of Capital One 360.

For the most part, I’m happy with my ShareBuilder account. What I’ve noticed, however, is that budget-conscious investors could probably avoid more fees with some of the newer discount brokerages. Since investing with ShareBuilder, I’ve also tried Tradeking and Zecco (which are both now the same company), and found the fees to be more reasonable. For more choices, see these best discount brokerages.

ShareBuilder-Welcome page

Updated June 23, 2016 and originally published March 21, 2011.

About the author

Luke Landes is the founder of shizennougyou. He has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about Luke Landes and follow him on Twitter. View all articles by .

{ 12 comments… read them below or add one }

avatar 1 Ceecee

I appreciate this review as I often get solicitations from ING to open a Sharebuilder account. Other discount brokerages like TDAmeritrade also have that tricky $75 fee for transferring your account. It is paramount to get cheap trading fees when your purchases are on the small side. I’ve gotten to the point where if I can’t buy 100 shares of something, I just don’t buy. The buy/sell fees eat up any profit.

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avatar 2 Anonymous

I wouldn’t recomend making such a small trade ($100) on any brokerage company. To be cost efficient the minimum trade on most brokerages has to be at least $2000 so the $20 comission you pay ($10 to buy + $10 to sell) represents only 1% of the total amount you are risking. If you can only risk $100 at a time you are better off doing dollar cost average into an index fund with a mutual fund company like Vanguard.

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avatar 3 Luke Landes

I can’t argue with that. These fees cut far too much into the (potential) profit margin on small trades. I like the concept of using a company’s “bonus money” to cover the cost, though, so take advantage of bonus offers.

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avatar 4 Anonymous

When I signed up for a Sharebuilder account last summer, I found that I could only sell my investment(s) via real-time trade. Maybe I misunderstood or maybe it’s changed since then. Still, it actually makes sharebuilder right in line with other discount brokerages, if you buy and sell a single lot of shares. Other places would be $7 in and $7 out. Sharebuilder would be $4 in and $10 out. Granted, most of us probably buy more lots than we sell. But at the same time, most of us should be investing in broad index funds, for which we should be paying zero commissions.

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avatar 5 The Latter-day Saver

I like Sharebuilder alot. I snagged a bunch of free trades (real-time and automatic investment credits) a few months ago that let me reorganize my portfolio for free (I bet if someone googled for the codes, they might still work). I like that they do dividend reinvestment, too.

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avatar 6 Anonymous

Sharebuilder was the first company I used about 5 years ago. I really like it for long term investing, and it’s $4 trades make it so cheap to do so. Now with ING, they also have a lot of great research tools available. It is overall a pretty good brokerage.

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avatar 7 Anonymous

hey MR Robert how are you”? I am new into this investing thing and I do not know how to start… can U give me some tips on this investing program…? Thank you!!!

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avatar 8 cubiclegeoff

I use it because I opened an account, bought some stocks, and haven’t changed anything. I originally liked it because it was really easy to reinvest dividends, since you don’t have to have whole shares (unless you do a market purchase). I still use them occasionally, but it’s only for play money, not my major accounts. And I prefer to wait for deals that give me free trades.

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avatar 9 skylog

i used it years ago when i just started out. if for no other reason than it got me started, i will think of it as a good service. while the cost of trading is too high, in my mind, if it is done right, it can be a solid service.

that said, i love that they were acquired by ing direct. already having an account with them, the ability to transfer funds between accounts is great. still, i had not used sharebuilder in years until last year. i was able to get a $76 promotion and a ton of free trade credits so i went with it to make some regular purchases i wanted to make. it has been great. i am looking forward to the site upcoming site upgrade and better integration with ing direct.

my only concern is the fact that ing direct is for sale by ing and will be sold by 2013. this has me worried.

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avatar 10 Anonymous

I’m frustrated with ShareBuilder now.

I can get money into my account and perform trades, but do anything like sell to move the funds back to savings is nearly impossible. I’ve been trying for over 2 weeks and all I get is bunch of error messages. Even when trying to send a simple email contact form.

For the actual trades themselves, while Sharebuilder is slow about it, taking a business day or two, getting them setup to be done is pretty painless.

I’m getting charged fees though on no load mutual funds for transactions when the trades were going in as free trades.

At this point, I can’t recommend Sharebuilder and if I could get my money out in a timely manner would go back to USAA for trading.

I hope Sharebuilder sees this as I’d like to be happy, positive experience customer for them, but I can’t even get a hold of them. Ah, the fun of living overseas out of normal US business hours.


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avatar 11 Anonymous

I have a Sharebuilder account and also a Scottrade account. I love both of these brokerages. I use Sharebuilder of rmy Tuesday dividend stock buys and Scottrade I buyother stocks the rest of the week. I have never had any troubles with either broker. I have a “NEW” scottrade referral code that will get you 3 free trades if you want to open any type of account at Scottrade and do what I’m doing. I have done this for about 10 years, and have done well. I never want all my money at just one brokerage.

Scottrade referral code: IXFV9382

3 Free trades when you open a Scottrade account.


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avatar 12 Anonymous

I had an Orange Account and closed it … no problems … My father passed away and had a ShareBuilder account … that was a whole different story … WOW, the Registered Reps were clueless and didn’t help me transfer the account. I was a Registered Representative for another company for almost 8 years and I was shocked of their incompetence … good luck getting a 1099 Div or any other tax documents if you invest … I’ll stick with E Trade

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