BROKERAGE FEE

A fee charged by an agent, or agent's company to facilitate transactions between buyers and sellers. The brokerage fee is charged for services such as negotiations, sales, purchases, delivery or advice on the transaction.

There are many types of brokerage fees added in areas such as insurance, realty, delivery services or stocks. Brokerage fees will usually be based on a either a percentage of the transaction or a flat fee. They can also be a combination of the two.

Here is an example of the fee breakdown from a typical stock brokerage:

Stock Price Over $2: $28 flat rate up to 999 shares, 3 cents per share over 999 shares.

Stock Price $2 and Under: 1.4% of principal trade with a minimum of $28 charged.

= brokerage commission