Your argument and analogy are flawed. --> The stock market is a thousand times more efficient than a blackjack table. The trader's edge is declining while the players edge has been constant for years. --> The upside of a good strategy is far greater in the limitless potential of the stock market. --> Traders that forgoe .0015 for a better platform or support can easily make that up in higher profits. Card players that give up house edge for comped buffets or show tickets get no such reward. Oh yeah, and blackjack players don't play in decimals.
I don't know what you mean by "efficient", but typically the platforms and support stuff is just a sales pitch to attract customers. Now if your software is going down every five minutes, then no .0015 is not worth it, but in most cases, there is negligable difference between the firms and the comm rates are much more important. I have traded live with just about all of them, the TRADER makes the $$$, not the platform. If a firms' propietary platform/support really was superior, they wouldn't get caught in a price war - they would charge more and people would pay it. They have all slashed prices, which proves clearing trades is a commodity. Not much difference between the firms' products.
Very simple asuming that most daytraders here are using at least a respectable software and if everything else is equal then the only logical thing to do is to fight for the best commission structure. I don't think it's that hard to figure out. If i paid .0005 lower last month i would have made an extra $1000, if you guys that don't care about commission don't want the extra $1000 feel free to PM me and i will give you my bank account #
- the stock market is not a thousand times more efficient than a blackjack table. and you cant get any more efficient than a roulette table or other games in the casino. at least traders have some edge (though declining and eaten away by costs, slippage) but for most non-card casino games, there is no edge whatsoever. - it is possible for traders to both cut their costs AND get a better platform/support, or vice versa: pay more and get worse service. The market for trading services is not very transparant and. your assumption that traders who pay an extra .0015 will be in a better position to make more profits is fundamentally flawed, as paying more doesn't necessarily get you more. ie, purely for software: i could pay >1c and use redi+ or pay less and use hammer or greybox. - i think esc_trade makes a great point that in many instances the new trader is taught what they know by the casinos. very dangerous. -Why anybody would pay for realtick now is beyond me, they were arrogant pricks for not reducing prices and there's nothing they offer that is all that special. Anyone who argues that they run a great business because they don't lower their costs sounds like some LLC owner using that as an analogy for a reason not to lower rates. Firstly, we're not owners of LLCs or software companies, so what do we care if Realtick as a company is so great because they don't give in to market pressures to lower rates? That only makes us worse off in keeping our (traders) costs of doing business higher. Secondly, in my opinion, Realtick has been deteriorating rapidly, the data sometimes comes in so slow it's pathetic. I'd rather pay $99 and use tradestation or AT/ILX.
The question I'm asking is, would you be willing to take $1000 to trade on a platform that sends orders to ISLD in, say 130 - 140 milliseconds? Do you know if that is fast? Fast enough to make up the $1000 head start? Depends on your trading style too, doesn't it? I'm not talking about the 'value of training or service', I'm talking about slippage. I know a lot of platforms running on older and older servers because they can't afford to keep the equipment up-to-date in this pricing environment. At some point, it begins to catch up to you. Look, paying an extra buck or two per thousand is silly, but an extra .0005 might not be. Looking back at your commissions can be misleading. "Gee, I just realized that if I had traded for $1 per thousand, I'd be up $700,000 this year". There are guys trading for $1 per thousand. Last year they were paying $3.50. And guess what, they're not up $700K.
I'm new to this community and this thread was the first thing that grabbed my attention. Why you ask? Because one of the things that has brought me to this neck of the woods is the search for a firm that might be wise enough to offer a state of the art execution platform combined with rock bottom ticket charges. I'm currently a client of a firm which was just acquired by Sungard. Ticket prices were already marginal and whats the first thing that Sungard does? Immediately jack up ticket prices! Once again, just like the Protrader - Instinet deal, the greedy corporate bastards come in with little or no 'real' knowledge of the niche they just purchased and when there new 'little toy' doesn't function on auto-pilot, and they only spent a few bucks on it, the just kick it into the corner and eventually it ceases to function and is tossed into the corporate refuse bin. Anyway, I don't mean to ramble but ticket charges for a person that rarely loses money against the market is quiet a big deal, and yes, I'm speaking from personal experience. I currently trade about 3 Million shs a month and climbing and i consider myself quiet the underling among my peers. If anyone knows of a firm that offers cheaper than 3.50 per thousand I would like to see a post. Happy Trading Doc
Exactly my point - and I want a ferrari that costs under $30K and gets 40 mpg. At some point, there's got to be a tradeoff between what you pay and what you get. I mean, you're probably trading with a good computer on a card table in some low rise office building in the middle of Round Rock's tech corridor. And other than the free sodas and snacks and the playstation 2, there's not much being wasted on frills. But somehow 3.50 per thousand seems like too much?
I don't really don't think your analogy is a good one. The Ferrari things a bit like apples/oranges.. How bout this......."A hot meal at a fair price?" You like that one?