[stevenmac2]

Hi Mark and Spencer,

I contacted Scott Trade on the question if I opened with the minimum and it fell below $500, would there be any penalties? - and they said no - so you were right about that.

Since I am new to all of this, I decided to take some of my funding money to pay off a credit card instead and some to primary savings, and I left $500 to open the account with Scott Trade. I figure if I placed all of it into the account, I will eventually burn through it being new to this.

Given that and with my limited knowledge on placing orders, I have a few questions:

1) With $500.00, do you have to buy in blocks of 100 shares? or could I find a top notch stock and buy for example 5 shares instead of 100 of a cheaper one? or is there a minimum number of shares that must be placed? Also, what is the lowest amount on purchase price for a piece of stock without it being classified by Scott Trade as Penny Stock?

2) I have been reading some about Money Managemet and along with that on keeping records when trading by incorporating a traders journal. I know that most people like to add in trading fees for a round trip so they know what their actual profit is. But I want to go further than that and ask about the taxing of it.

A) If I buy some stock and hold the stock in the market, my understanding is that I do not pay tax on that stock.

B) If I sell the stock before 1 year, I will pay a higher tax rate. If I sell after 1 year, I will pay a lower tax rate (I still need to find what these capiatal gains rates would be based off of). If I sell the stock and the cash is in my brokers account, do I still have to pay tax on it or do I pay when I actually withdraw that money from the brokerage?

And if I do need to pay tax on a sale of a stock, should I not include this into my trading by including price of stock, fees, and tax to understand my overall profit and breakeven point? At the end of the year, what would I need to present for tax purposes?

If you wouldn't mind explaining how you track and handle this, that would help me have a better understanding of this.

Thanks for your time and assistance to answering,

Steven Mac