It's happening, negative commissions are really here...

Discussion in 'Wall St. News' started by guru, Oct 9, 2019.

  1. guru

    guru

    At least according to this article:
    https://www.financial-planning.com/news/what-schwabs-zero-commission-trades-means-for-robinhood

    Though the article makes it somewhat unclear:
    "Other startups are looking to take the floor off of the so-called race to zero. All of Us, a new social media trading platform, pays investors to trade. The firm charges a 50 basis points fee but will return other profits made from assets back to investors, according to its website. All of Us is currently raising capital, with major investments from Apex Clearing."

    upload_2019-10-9_20-19-40.png
     
    GregorySG9 likes this.
  2. Overnight

    Overnight

    So now everyone is going to race to trade because they think they will make money by being traders. It is too bad they do not know that is just not how it works. Trade away $1000 to make a dollar on that trade in free commish.

    Fascinating, Cap'n.
     
    GregorySG9 likes this.
  3. guru

    guru

    Now someone just needs to create an ETF that doesn't move in price at all, so that we can trade the hell out of it.
     
    jys78, GregorySG9 and Nobert like this.
  4. tsznecki

    tsznecki

    Hold on here. Depending on your broker, pricing scheme and choice of asset, one does already get paid to trade for resting limit orders.

    Why the outrage?
     
  5. guru

    guru


    Good point, they may just steal your credit for providing liquidity and then give part of it back to you pretending they’re paying you, so you could end up getting paid less than not dealing with them.
    That’s also how you get cash back from supermarkets but still end up paying more than at Walmart.

    Either way it looks like marketing spin but it’s interesting to see how much lower can they go with those fees (to the negative)...
     
  6. CALLumbus

    CALLumbus

    guru likes this.
  7. terr

    terr

    That's only for one month...

    If they ever "pay you to trade" they will really have to put a lot of restrictions in that. Like the trade has to be over a certain $ value and you can't trade more often than a couple of times a day, and only on certain stocks. Otherwise I could buy/sell 1 share of a $0.05 stock getting $0.50 back each time (let's say) a hundred times a minute. That's $3,000/hr. Not bad. Where do I sign up?
     
    jys78 likes this.
  8. CALLumbus

    CALLumbus

    Yes, you are right. That payback feature is a promotional offer for a limited time, but still, you can trade all year long with zero costs/ commissions, which is not bad and a big change from where this industry was not too many years ago, especially in Europe.
     
  9. tsznecki

    tsznecki

    It shows a lot of the ETs crowd level of knowledge about micro structure when most of you couldn't even figure out that when you route to specific exchanges you get paid for offering liquidity.

    By all means use market orders and bend over.
     
    jys78 likes this.