The following is a formula or method for calculating SEC and FINRA fees to find out how much fees investors must pay when a stock sale transaction occurs.
Before going into the formula for calculating the fees, it's a good idea to first know what SEC fees and FINRA TAF are.
SEC fee is a fee that must be paid to an independent federal government regulatory agency that is responsible for protecting investors, maintaining fair and orderly functioning of the securities market, and facilitating capital formation, in this case in America is the SEC (Securities and Exchange Commission).
Visit the official SEC website.
While the FINRA TAF fee or more commonly referred to as the Trading Activity Fee (TAF) is a fee that must be paid to the Financial Industry Regulatory Authority as an independent non-governmental organization that writes and enforces the rules governing registered brokers and broker-dealer companies in the United States.
Visit the official FINRA website.
Both SEC and FINRA fees are mandatory fees that are legally charged on every sale of any securities product including shares.
Both fees are automatically debited from the proceeds of the sale of securities.
Why Are There SEC Fees and FINRA TAF?
The key word to remember from the explanation above is that both fees are mandatory according to US regulations, and are levied on sales actions.
This means that the purchase of shares will not be charged the fee.
The reason why the two fees are collected is because both institutions are responsible for ensuring the security of the investments made.
Indeed, until now Gotrade has not been officially registered with the OJK because the company behind it is based abroad.
In addition, the sale and/or purchase of shares is carried out on American (US) securities assets so that the implementation rules are also regulated and subject to all provisions stipulated by the United States Government.
Precisely with the SEC and FINRA fees, it proves that Gotrade users invest in the American stock market, not just buying tokens or not Contract for Difference (CFD) shares.
What's more, because it is registered and supervised by the SEC and FINRA, application users as investors can be more confident with the security of their investments even if they come back again...
… that the decision to invest is entirely the right and responsibility of each.
SEC Fee formula
The fees levied by the SEC are calculated by the formula:
SEC Fee = total price of a transaction x $5.10 / 1,000,000
Or the total price of a transaction multiplied by $0.0000051
Well, very small and very minor is not it?
FINRA TAF Rumus formula
While the fees collected by FINRA are calculated by the formula:
TAF = $0.000119 per share sold (with a maximum rate of $5.95 per transaction).
Very small right?
Even if you sell 1 lot (100 pieces) you will only pay $0.0119.
For a maximum figure of $ 5.95 will only be paid by investors who sell 50,000 shares (500 lots) in one sale transaction.
Oh yes, the word "transaction" in the formula for the two costs applies to selling, not buying.
There is no fee for buying shares.
Calculation Example
There is one more provision other than those described above.
The results of the calculation of the two costs are rounded up to the smallest nominal of 1 cent ($0.01).
For example, if you want to sell 1 share of Alphabet/Google (GOOG) at $2830 then:
SEC fee: $2830 x $0.0000051 = $0.014443 rounded up to $0.02
FINRA TAF: $0.000119 x 1 share = $0.000119 rounded up to $0.01
So the total fee to be paid is $ 0.03 or 3 cents.
The second example, if you want to sell 1 share of Appel (AAPL) at a price of $ 160 then:
SEC fee: $160 x $0.0000051 = $0.000816 rounded up to $0.01
FINRA TAF: $0.000119 x 1 share = $0.000119 rounded up to $0.01
So the total paid is $ 0.02 or 2 cents.
Easy isn't it?
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