naa man, you can place your limit order at the price you like and wait till it gets to you, when it does [if it does] you added liquidity at that price. The thing is that if it doesnt get filled you dont get nothing. And if the price just drops 50 cents right through you, well you get your credits, but you're still stucked on a bad trade.
So if you only use limit orders in your trading, is there any downside to participating in liquidity rebates?
you have to use limit orders to participate of rebates... if you use market orders you cant add liquidity, now can you?
I don't understand what you mean here....if you use attain to cross the market, wouldn't the rebate you get from your fill be negated by getting filled at a worse price? Also, I am interested in whether rebate trading is viable for someone paying a low per share commission of .0015, or do you need to have fixed price commissions regardless of order size and then scale up to 5000 share or more size for this strategy? Is the goal in rebate trading to just collect the rebates, or are you looking for setups where you can be gross profitable? Losing a single penny gross on a trade would negate a few winning trades, so is this strategy only viable on stocks with sub-penny spreads?
not really a worse price. If stock xxxx is at 1.98 bid 1.99 ask... you buy at 1.98 through island... and then exit at 1.98 trough attain... you just made your self around 0.47 cents. do it 3 times and you've gotten a bigger profit than buying at 1.98 and selling at 1.99 once. 0.0015 per share = .15 per 100 shares... it would make it very difficult for you to take a profit... when you're getting around .2 per 100 shares. You'll need way too many shares to do a profit... and something like 20 trades to get backa single point gross.. i dont think its profitable... true rebatetrading consists onprofiting mostly out of rebates, gross gains are welcome but never sought. when the price is about to change, rather than seeking gross one seeks to enter and exit several times.
I had several friends that used to make money "Rebate Trading", they are out of the business. I do not know anybody still making a living at this nickel and dime game of 1999.
I'm not sure I would call it "nickel and diming". There's some guys at my branch who easily flip huge size and make more in one trade than some people do in a day here. Of course, the only way to make good coin with that strategy is if you get the dirt cheap per lot commissions that we do.