FSMOne Dividend Handling Fees

Investing
1

Morning Everyone,

i have a quick question regarding trading FSMOne accounts. Anyone have experience with the dividend handling fee they charge for the US Market?

I understand they charge USD 2.50 for delivery handling fee. However, what if my total dividends for that year is less than 2.50? Does that mean I lose all my dividends? Plus they will somehow deduct from my cash account?

Also, do the deduct this $2.50 once every payout? or do you deduct it once per year?

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2

Hi iBuffering

I use FSM and I have experience regarding the dividend handling fee structure. I have also enquired via live chat before.

I own a few US counters in FSM and the dividend handling fee is payable on every dividend handled. In my enquiry to them, the reason for a dividend handling fee is due to a fee being charged by their counterparty.

If your gross dividends for the dividend payout is less than USD 2.50, then you will not be charged anything.

If your gross dividends for the dividend payout is more than USD 2.50, then you will be charged according to their dividend handling fee structure (min USD 2.50 or 1% whichever higher, max USD 25).

Illustration:
You hold 10 shares of company A and there are 3 quarterly dividends of $0.50 per share and a final dividend of $0.25 per share, which gives you a total dividend of $5 per quarter in the first 3 quarters and $2.50 for the fourth quarter.

  • Quarter 1: Total Dividend $5 => Gross Dividend $3.50 (due to 30% WHT) => Dividends Received $1.00 (due to dividend handling fee)

  • Quarters 2 and 3: Per Quarter 1 above

  • Quarter 4: Total Dividend $2.50 => Gross Dividend $1.75 (due to 30% WHT) => Dividends Received $0 (Gross Dividend < Charges)

  • For the avoidance of doubt, there will be no deduction for the shortfall in charges for Q4.

Finally, for completeness and to ensure an accurate portrayal of my average cost, I add the dividend handling fee as “FEES” to my holdings.

Cheers
CSI

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3

Thanks CSI. Do you also put the 30% WHT in FEES ?

4

Thank you for the amazing and super detailed response :slight_smile: Very informative.

5

No, I do not.

I just set the 30% deduction in here => https://stocks.cafe/user/toupdatedividendspreferences

The reason is simple. The 30% is not a fee incurred in that it does not increase my average price. It is just something I do not get to benefit.

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6

You’re welcome.

Think I should also be clearer on the adding of fees.

If your gross dividends are less than USD 2.50 (eg $0.01 to 2.49) then you can consider deleting the dividend record since you did not receive any dividend and you did not pay anything to FSM as well.

However, another way (which I very much prefer) is to record the gross dividends you ought to receive as fees. Because in reality, that is exactly what happened. You were entitled eg USD 1 in dividends but was not given USD 1 due to the minimum USD 2.50 rule. StocksCafe records that you gained USD 1 in dividends and you add USD 1 to your cost, thus cancelling each other out.

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