As a liquidity trader my firm wants me to trade at least 250,000 shares a day with 40,000 of buying power and to lose no more then $500 a day. If you are a professional liquity traders can give my real trading advice on how to reach that goal PLEASE let me know...thanks
I am curious .... do not mean to offend anyone and am not with a prop firm ... but the liquidity trading that has been going on in recent months or yr or two ? was it an effort to pump up the volume on various ECN's or prop firms in order to make them more desirable and marketable to larger firms ECN's ala tradescape to e trade ? ala island to instinet ?
I think he wants to minimize his losses while bringing up his 250,000 shares to something more respectable like 1,000,000. Then he could cash in on the rebates. I've been doing this type of trading, but through an online broker that has extremely low commissions but no rebates! No direct access either believe it or not. I'd like to give the rebate deal a try, but I don't know of any brokers that would fit my criteria. My criteria would be super low commissions (must be $2 a trade or less for limit orders; no per share charges) and any rebate. Any rebate is better than no rebate! Any ideas people? Brokerage America no longer offers rebates for sub-$1 stocks... Laters, -Scalpa
There are a number of factors that come into play. One of the most crucial is the nature of the ECN that you are using. ECN's that are soesable and allow you to bid or offer for a fraction of a penny will give you the most opportunities to execute shares. The only way to be really successful trading rebates is to actually trade for profits. I have seen so many traders make $700-$1000 in ECN credits a day only to have them erased by market losses. To be successful you need to be both proficient in making trading profits and executing a large volume of shares. One strategy that works on ECN's that allow you to chisel between the spread is to find stocks that bounce around alot between two whole numbers. For example, if palm is trading at .78-.79, you might bid it at 78.1 and try offering it back out at 78.5 to make a small profit and the rebate on both sides. If they start taking out the bids, use soes to get out and let the rebate you received getting in pay for your soes fee and your .001 of a penny loss. Sometimes you might want to cancel your sell and try getting 79 or even 80.
Also erase the term liquidity trader from your vocabulary. You are a trader that uses ECN rebates to maximize your profits.
Is this the kind of deal offered by Nextrade? Anyone heard of them or trade with them? I've been told that rebates from them is one way some of their traders make money, even if they slightly lose on their actual trading results. If they do the volume, it will sometimes overcompensate for their small trading losses. Anyone?