I don't know if the broker placed the trade. They use to write up a ticket and take it over to a girl that would put in the order. I wonder if this guy still does this. That might explain the delay.
This is what most of the people on this thread are missing . . . If you were around in the business back in the early 80's, this is exactly how an order was placed. It went through an order room gal that sat in front of the "wire-house" computer. The broker that takes the order over the phone has nothing to do with the actual order entry. As a result, this can take some time, especially if there are orders "ahead" in the que.
Grampa is trading SPY not spooz dude! Assuming it was a 500 share lot worth $71,000, a full point move is not that common in 3 minutes, unless it was a news release. We are not getting the full story here.
That response sure does sound fishy. Why would they need to build a basket, unless they actually went ahead and individually bought the 500 stocks that make up the SPY, according to their weight and all in the index. However, I doubt that is true. File a complaint with FINRA. I did this awhile back with a broker who kept hounding me for a $10,000 check for a bond I did not buy (whose value had plummeted to $7,200). I later learned the broker had to make the difference up.
I remember back in the good âol days (pre-internet) when we all called in orders, depending on the order type, it was usually either a âflash fillâ whereby you could actually overhear the broker in the background filling your order, or if it was called in directly to a floor broker, it was handed off to a runner and filled within seconds, should not take more than a minute or two. However, in some cases, you would have to wait in line for your order to be filled. The second option was a âcall backâ where the broker would call you back with the fill, I can remember sweating it out waiting for a call back on a limit order. Who knows what type of order this was, there are many variations to broker assisted trade executions. Perhaps we do not have all the important details of this trade execution, the OP did not mention what type of order that was placed, or the order size of the trade, etc. I certainly would need more detailed info before I passed judgment on the broker or firm. However, I do not understand why there was a âbasketâ, obviously he should have been flash filled over the phone if it was a simple market order. Perhaps it could have been called down to the floor broker/trade desk whatever, and this is where the error occurred, or perhaps he was busy with another clients order and set it aside for a few minutes. As others mentioned here, there will be a time stamp for the fill, revealing all the details of the trade execution in writing. Regardless, if the error was indeed on the brokerâs part, he should request an adjustment, certainly not worth the hassle of arbitration over $500, a simple phone call could resolve it.
Old fashioned "full service" stockbrokers are largely paid on spreads and slippage - most will instruct their trading desk to wait until the order fill is best for them, not the client - I agree with "lying". Plus the SPY is traded mostly on AMEX, isn't that right? So don't you have M. Makers to contend with if the broker's firm does not have inventory of that security?
There are no "spreads" involved in a SPY execution, it is done net PLUS commission as are most NASDAQ trades these days. s.
It is actually very common practice, I read this book and a couple of others like it and was shocked at how prevalent this practice is, even if it is only partway true . . . http://www.amazon.com/License-Steal...=sr_1_2?ie=UTF8&s=books&qid=1211049118&sr=1-2 "What they want to do is show the fundamental conflict of interest that occurs between a broker and his clients: Clients only make money, in all likelihood, if they buy good stocks and hold onto them for a long time. But the broker makes money only if his clients frequently buy and sell. Like any salesman, a broker really sells himself to clients. He earns their trust, and in return recommends financial moves that are in his best interest--he urges them to buy the stocks he makes the most money selling, and discourages them from buying others"
thanks for correcting me - my last experience with trading SPY was when it was all AMEX some years back - market orders had a lot of slippage and even limits were sometimes hard to get filled But here is what I meant by slippage and spreads with full service brokers: 1) the broker tells Grandpa that the current price is $142.50 "at the market right now" 2) Grandpa says "Buy" 3) broker puts order through to his trade desk with instructions for the best fill possible, the broker's desk gets the order filled at $142.35, then sends Grandpa an execution slip for $142.70 - "sorry, the market moved on us!" 4) the broker gets paid the usual commission plus gets paid on the .35 spread between his trading desk fill and what he can get away with charging Grandpa without pissing him off too much