Alright, no more mud slinging. I'm in a generous mood since my beloved Yankees won! Anyway, I understand your point. But you have to realize that your payout plan is only good for people who trade huge volume for relatively low P&L. Then it works in your favor. For the majority of us who trade reasonable volume (around 60-100K shares a day) and focus on more volatile stocks, giving up 70% of my net payout is robbery! I've done $4K gross doing 100,000 shares per day and I would be screwed with your payout. For me, I don't mind paying .003 cents/share commission at all. I'd still take home more than with your plan. So it all depends on your trading style. High volume rebate traders will prosper with your plan. Low volume traders won't. To each his own. Peace out. GO YANKEES!!!
In the spirit of the Yankees, I am glad we made peace. And that is what I've said earlier - it can work for some - and not all. The whole spearsheet I posted was to see which one will benefit a trader better. All I know, is that a lot of firms pressure you into trading lots and lots of shares so that you don't loose to much but charge you commission. A lot of traders are at NET 0, while paying out commission to the firm. Wouldn't you rather get 30% of that? Otherwise, of course, if your volume is low, and your net/share ration is high - certainly you wil pay commission! I am by no saying that THIS IS THE ONLY WAY. This is ONE way. Anyway, Go Yanks.
If you haven't seen my post about NYSE "zero" commissions, you may want to check it out. After running some numbers, it makes sense for us to offer a 40% payout to traders who trade in 5,000 and up share size. This helps us with our "tailoring" of rates program for all traders!! Don
Are you talking about buying and selling 5k shares at a clip or a position that has 5k in it? If you are talking about trading 5k shares at a clip please tell me which stocks you trade because I trade Liquid Dow stocks and I can't even get off 1k shares without causing a buy imbalance.
Yes, 5,000-10,000 shares at a pop. We have many traders who do that in the more liquid stocks on the NYSE. By trading this way, we get a lot of price improvement (The Specialist will come down to us, or up to us for 5,000 shares, won't even bother for a 1,000 shares). As WCOM says, this setup is fine for a select few traders, and is not for everyone. But, as to the question of share size. When volatility was above 50, everyone traded 2,000 shares or more, and was glad to. Now with a meager volatility of 15-20 or so, we should be trader more size (less risk, obviously). Same thought process for stock price vs. Share size. AOL at $60-80, trade 1,000 to 2,000 shares....AOL (TWX) trading at ony $15, you should trade 5,000 shares or more. We have structured our pricing to benefit the traders for shares in excess of 1,000 per trade to help them make this obvious move to larger size. If you're really having trouble when enveloping NYSE stocks with a couple of thousand shares, you may want to find a new pair of stocks to trade. IMO. All the Best!! Don
Are you serious? The specialists are giving you price improvement on 5k shares? Interesting. They actually will come up above the mkt or below the mkt to get your orders? Also, I am not referring to stocks like AOL but rather the more expensive Dow stocks like MMM, IBM, and CAT.
Yes, especially stocks like that...they need (and really "want") the help on larger prints. This occurs daily. Don