How to buy and sell more than 20,000 shares frequently?

Discussion in 'Trading' started by kapama, Oct 2, 2007.

  1. kapama


    Here is my problem.

    I need to buy 2 stocks every Monday and sell them Friday. For 2 stocks only it is around 20,000 shares. The problem is almost all brokerages charge extra over 5,000 shares and it adds up alot.

    Since I am working 9-5 everyday I was not able to engage in Direct Access trading. You know you need to follow the market and spend sometime and monitor all bids and asks all the time. And 10,000 shares is alot so in a low volume environment, I need to be very careful.

    But then if I use my old brokerage account Level I system where you can only see best bid and ask, I will be overcharged with their markups and I do not want to do that. For Level II, As you all know, small brokerages like Scottrade and such, has the fake Level II prices not the real ones like Terranova or tradestation. So there is a scam there as well.

    So, one of my buddies recommended "broker assisted trading". Anyone knows if I can be ripped off by the broker over the phone or is it harder? Costs only 20 bucks but how can I know he is not marking up the bids and asks?

    Does anyone have a recommendation for me?
  2. What price of stocks are thinking of trading? Nasdaq or NYSE?

  3. Yes, I agree this is your problem. What kind of arbitrary system/approach is this??

  4. There are no "fake" level II and level II was never intended to be the entire universe of prices in a stock. Level II was developed so that the retail customer could see a bit more then the best bid and offer. Scottrade and others dont front run your orders and the bids and offers you see are real. If you wanted to hit a bid or lift an offer you could. The competition among the brokerages these days is razor sharp if they were so blatantly ripping off their clients people would easily and simply leave them.

    What is the average volume in the stocks you're thinking about trading and where are they listed? You do realize that you can check the time and sales on your trades vs the market at that split second and you have to be filled within certain parameters.

    What incentive is there for a broker to rip you off on a hand held order you give him ? WHy would anyone pay the extra 20 bucks ( not that its much ) if they were giving a broker incentive to rip you off?

    Seems to me if you're that affraid of being ripped off and you cant watch the market then you should not be in the market that active
  5. why so many shares? i am assuming these are very liquid stocks?
  6. kapama


    The prices of the stocks that I am trading are minimum $5 and minimum volume is 100K.

    I met this experienced trader telling me about slippage. He told me Scottrade and others are manipulating prices not only on the Level I but also on the Level II. He told me he and his buddies monitored several Direct Access platforms at the same time for the same stock and they saw different prices. He also said Fidelity, Terranova, tradestation and cybertrader have the real bids and asks. I think he was using Fidelity and he can sell higher than his asks and buys lower than his bids occasionaly. I guess Fidelity has an advanced system.

    Now for someone like me, this will be very important cuz If they rip me off a penny on every share it is like $200 on a 20,000 share deal.

    Someone said why don't I check the buys and sells after the day and compare it to mine to see I am ripped off. Where do you get that data? And is this possible?

    If this is possible then I will sign up with cuz it is free to trade for unlimited shares.
  7. chud


    Why only 20,000 shares? If the strategy works, might as well go on margin and buy 200,000.
  8. With volume only 100k, you will drive up the drive so much when u buy and drive it down when u sell.

    If u want to execute 20k shares, u need stocks at least with 2 millions share daily avg
  9. And, just "why" is Zecco free...think about what you've said about other retail brokers. You need the NYOB (for NYSE) IMO to insure your pennies.

    Since you're keeping the shares past settlement, you'll need to take that into consideration as well.

    Best of luck,

  10. drawer77


    i don't think that trading with 2 chunks of money on 2 stocks is a good idea.
    #10     Oct 2, 2007