DEF NO KIDDING They want to manage your money, not have you trade your own money! There are probably 75,000 active day and swing traders in the the U.S. alone. When are you guys going to wise up the fluidity of the markets is going to dry up. Single stock futures is our only hope. There will be so much action in some of these instruments that the stock boys will adjust their closes to the futures close. But it won't last as the "always vigilant" SEC (in the big boys pockets) will put the kabosh on this also.
def, In my vocabulary investor n. fool; sucker; prole I can fully understand why it is in the interest of the old boys to turn traders into investors. I also know that in some perverted sense they may be even doing this people a favour. ( We all know that most daytraders lose money; especially those under 25K). It is also the case that this people can not support the market nor it is the goal of this people to do so. Do you want to support someone's summer home in Hamptons? However, you and your bosses should ask yourselves:Who is the ultimate loser in this rule? How many accounts have you lost last week? How many will you lose in coming months? I think that Direct Access brokers have not done everything in their power to prevent or at least modify this rule. As far as the small trader/investor goes: I think he is much better off to invest his money into sausage or ice cream stand.
michaelday, i concede, you win. from your comments it sounds like you suggest there was a conspiracy and all the brokers got together over cigars and beers and colluded to get the small players out of the market. last I heard the direct access brokers are not a cartel. their power is limited compared to an investment bank. There is no doubt in my mind that the basis for the rule was not to "save" the small investor but to profit by their absence. What ever the reason, it is a done deal. IB and I assume all other DA firms are and were against the rule. what else do you suggest these firms do? IB has a person based in DC, did lots of legal work, wrote comment letters (which if I recall I pointed out on this site and recommended that those against the rule write letters to their congressman and the SEC. Did you?), to no avail. The only way this rule has a chance of being repealed in my opinion is from the grass roots level (or a serious drop in exchange volumes which I do not suspect will occur). I have no clue if IB had a net gain or decline in accounts last week. That is not the issue. Perhaps you are taking offense to the way IB is interpretting the rules. Fair enough, but as I stated give some time for the dust to settle. The firm is conservative when it comes to risk management and regulatory issues. Some poeple who place serious amounts of cash to trade via IB like it that way. I have to admit that I find it a bit humerous how many of you are bashing the firm that has fought for the little guy for so long. Fees are still 1/2 to 1 penny per share. No ECN fees, etc. Access is still direct. These fees attract both large and small accounts alike. However, with the rule changes, smaller accounts will have to adjust their trading style, trade less, go to a prop firm, or consider paying more elsewhere. IB didn't create the rules but it has a legal obligation to follow them. In my opinion, you are just shooting the messenger. One last thing: as for your comment about investors being fools. I bet Warren Buffet sleeps alot better than most of us.
def, I guess you got me all wrong. I do not consider IB to be part of "old boys network". I do agree that IB was among the first to help out in leveling the field. I know that IB has voiced it's opposition to the rule. I also know that if I was in IB's or any other direct access broker's managament - this rule would have me worried. Maybe not it's immediate effects but growth prospects. Again, I don't have anything against IB - quite opposite.
no problem, i read you wrong and it hit a nerve. sorry bout that. definately a frustrating issue. Sure there is concern but the firm is pretty innovative and thus i'm sure it will prosper.