The Depository Trust Company (DTC) provides clearing, settlement, and information services for securities traded in the U.S. Most stocks are DTC-eligible, meaning they can be settled electronically through this system. However, certain securities — typically low-priced or penny stocks — are not DTC-eligible, or have had their eligibility revoked. These securities cannot be settled through standard electronic clearing and require manual processing, which carries additional costs and complexity.
Accounts holding non-DTC-eligible securities are subject to the following:
Fee | Amount |
Non-DTC eligible/illiquid securities (penny stock) Monthly Holding Fee (per security) | $10 |
Non-DTC eligible/illiquid securities (penny stock) Minimum Equity Requirement | $200 |
Monthly Holding Fee
A $10 monthly fee per security will be assessed by Apex Clearing Corp and passed through to your account for holding Non-DTC eligible/illiquid securities.
Minimum Equity Requirement
Firstrade requires a minimum equity balance of $200 to be maintained in an account holding Non-DTC-eligible/illiquid securities. This requirement is in place to cover potential pass-through settlement fees from our clearing firm, Apex Clearing Corp, which can vary and may be substantial depending on the security and the number of executions involved. Because fees apply to each separate contra-party execution, a single order that fills across multiple transactions can result in multiple fee assessments. In some cases, these cumulative fees may exceed the value of the trade itself, particularly for small orders.
Both the monthly fee and the minimum equity requirement will remain in effect for as long as the position is held in your account. You may lift these requirements by:
Liquidating the position through a sell order
Disposing of the position via the Penny-for-Lot program
For more information on the Penny-for-Lot program, please contact us.