Quick example: Monthly volume : 10M Monthly PNL : 20,000 70% // 0.20 per 1000 Net = 12,000 100% // 1.00 per 1000 Net = 10,000 Of course the break point will vary widely with volume and monthly PNL. And I don't even know of a firm that offers 100% and 1.10 per 1000. But that was just to show how big of a chunk commissions can take away when you up the volume.
lets try another example monthly volume 400k shares monthly PNL $10,000 60%// 2.00 per 1000 800 in comm. net $5520.00 98%// 8.00 per 1000 comm. $ 3200.00 net $6800.00 And I don t even think I would have to pay that much for 400k commish is just the cost of doing business unless you have a lot more losing trades than winners. BUt any profitable trader can see this is much better. B My firm rocks
based on 1 million shares I guess if you were credit trading and make sub pennies and earn ECN credits it would not apply but as long as you make .01-.016 per trade the fee is covered so I still don t get it, you have to be making a lot more losing trades then winners in order to really benefit from the difference I agree if you are doing a million plus a month that could be drastic but 500k per month I would think is well within the average
I am talking about 10,000,000 , not 1,000,000 But that applies to a somewhat small community of traders. And I agree with you; someone doing 500k volume monthly could be better off with a deal similar to yours.
your debate got me thinking so I put this sheet together. Looks to be like the low commish isn't as appealing unless you have a really low PNL.
Sure it does no split wins everytime!!! First off the .01 is only for traders who trade less then 100k per month anything over that it drops to as low as .002. The difference is huge. And as for retail it comes with so many head aches like platform quality, have to keep a lot more of your own money in the account, (4;1) the day trade rule, complicated tax returns, no ecn rebates limited routing issues. And I am sure I am missing somethings. So sorry I still not convinced. no split is better if you make money trading. B
That pretty much sums it up. And commish rates are dependent on volume, and volume is dependent on good trading, and good trading is dependent on knowing what you're doing, and when you know what you're doing, you make money, and when you make money you trade more volume, when you trade more volume your commish goes down......LOL.... that's just the way it is. Gotta have a good trading strategy and group. I have traders who trade under 100K per month, and those who trade 20million shares per month.... it boils down to the bottom line. I've had good traders leave for a few mils in commish, and return a couple of months later for various reasons.... I've had some leave and never come back as well... We respect traders for running their trading business within our organization. We have never been a "perfect fit" for everyone (just most, LOL). And, remember "using capital" does not equate to simply "buying power" like 20 to one or something. 20 to one, used wrong can kill you. 100 to one used well, can save you. FWIW, Don
And chance favours the prepared mind..(LOL) So many ways to skin a cat... etc. . I don t think it matters if you trade momentum or if you scalp as a day trader you need: leverage to be competitive fair commissions to remain profitable huge pay outs to keep the money you work hard to make. Not sure why we still are debating this 98% or better pay out will never be beat. I am for the higher payouts everytime. My firm has it B