Wednesday, December 9, 2009

Scottrade Blocks Buying Of Penny Stocks

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I had a reader write in and ask me if it was true that Scottrade blocks buying of penny stocks. Rather than just do my research on the web, I decided to call Scottrade directly and ask them. I called the contact us number on their website and because it was after hours, I was transferred to their national call center. I spoke with customer service there and was told that you can definitely buy penny stocks at Scottrade. There are however, certain penny stocks that do have restrictions on them where Scottrade cannot complete settlement of your purchase either because of a decision by their risk management department or the Depository Trust and Clearing Corporation, aka the DTC.

In any case, I was told that this is not a very large list. It could also be that you might be able to complete your trade at another broker as it seems that different risk management departments may have different stock market investing policies that wouldn't prohibit you from buying that penny stock through them.

The best thing you can do if you have trouble buying a stock through Scottrade or any other broker is call them directly and ask them if it is true.

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