I am with a broker called Tradezero and I tried shorting a stock at 3.52 but it went down all the way to 3.33 before it got filled at a price already to low to short. This only took about a couple of seconds. It seems whenever there is volume spike my order gets filled late. Is this market maker trick or is my broker just not fast enough and loses priority to other routers? They use something called smart route. I am not sure if that is common or unique to them. This is a huge problem for me cause I tend to trade momentum breakouts on volume if my broker keeps doing this I figure I'd go broke.
Exactly that.. don't trade at market orders but limit orders. I don't know what exchange this was on, but it could be that flow info is being sold to HFT and they are just a few milliseconds faster. It's basically front-running... which is shit... but apparently some exchanges allow it. If you do a limit order outside the current bid/ask... does the same thing happen? Does it happen all the time? If so, then I definitely think it's HFT getting the info. But I doubt you trade big enough to move it on your own. Is the size you trade a lot larger than a typical bid/ask? If it only happened once or twice, maybe just unlucky. Happens plenty of times with me in futures... just too slow.
To be honest, I don't know TradeZero, but I would never trade with them anyway. It's Bahama based right? There are a few posts on ET about them.. it seems mainly by 'traders' that post only a few times... generally the posts are "are they legit?"... or they are by people who think they are the best one out there. That means a no-go in my book.... so if they screw you on market orders... meh, you deal with sharks you get bitten...
Well this is the 1st time I traded with them in a year and I just noticed this issue today. It happened aleast 2 times during a volume spike. My account is small so definitely not big enough to move it. I have tried limit orders outside the bid/ask but rarely do they get filled cause when I am trying to buy it usually goes up and doesn't come back down for a while. I never tried a buy limit order at a price above the current bid. Can you even do this?
in FAQ on their website: How does TradeZero profit from free limit orders? The TradeZero smart router will route the non-matched orders to market centers that provide payment for order flow or rebates. These market centers include ARCA, EDGX, BATS, NSDQ and others. How does TradeZero make money if it offers $0 commission?. Rebates are paid for order flow by various market centers including EDGX, ARCA and NASDAQ. Are accounts accepted from the US? US and Bahamian citizens cannot open accounts with TradeZero for trading US stocks and options. (why do you think this is?) --- if it looks like a bucket shop and it smells like a bucket shop... it's probably a bucket shop ---
This is a joke... - no commission - higher leverage - no pdt-rules - based off-shore Totally targeting newbies with no money, you can probably open an account with 100 bucks... yay no commissions! And amaaaazing leverage.... so with 100 bucks I can buy 100k worth of penny stocks... I would pull out before the church bells go off...
They only charge commission free if you make an limit order outside the bid/ask which I rarely do. I don't like the idea of my orders never getting filled. Maybe ok if your a long-term investor but daytrading it wouldn't work.
Mate... they sell your order info to HFT... it says so on their website.. it's how they make their money... How do you get to think that you're not getting buttf#$cked? Because you are... all the facts point in that direction. - targeting specific clients through low margin/high leverage/low deposit - located outside of a major proper regulated country - make money through selling orderflow - have a russian language option on website - have a blog on website - have a private registration website (can't view who owns website)
Well I am not gonna pretend I know what HFT even is. Does that stand for high-frequency trading? And if so, what is so bad about it?
Yes. TradeZero gets your order... they give that order info to HFT, for which they get paid... HFT sees that you're about to post a market order... so within milliseconds they sweep the book and you pay top price. Or, depending on what stock and exchange this is... (mind telling us?) they run the quotes on this stock... move their quotes on the basis that you are about to buy... you pay top price.