Multiple question here. 44% of revenue at Schwab is earned interest - trading revenue was about 8% - please read the 2016 annual report which is available online. It is definitely an asset gathering model and that is why competitive pressures will lead to free trading if rates get back up around 5% on the 10 year. Trading has become a crappy business, but it brings in all the cash to earn a spread on. Schwab actually rebates all ATM fees worldwide. Think how awful that business decision was in the rate environment for the last decade. Fidelity does the same thing with ATM fees. At IB in 2016 interest income was over $600 million just a few million under commission revenue.
When I spoke with one of robinhoods competitors a couple of weeks ago i mentioned that I used robinhood....she started asking me questions about the platform and asked how could they make money without charging commission so I told them how they made their money, they were a bit surprised but it sounded like in the near future most brokers will be offering free commission trades. I can't wait for the next round of price commission wars...all one company has to do is release news they are offering $2 unlimited shares trading and you'll see all competition in only weeks follow suit....that's what happened the last time, that's why ameritrade and E-Trade dropped commissions from $9.99 once fidelity dropped their commission costs to $4.95 last year.....
Just made my 60th trade today using Robinhood That's since opening the account in early February If this were an etrade or Ameritrade account I would have already spent $417 on commissions!!!!!!
Can someone confirm if Robinhood allows trading in SPX and VIX options? If yes, do they charge the exchange fees?
How are the market and limit orders -- Do you get an instant, and good, fill? Or do they somehow cheat or scalp your order? (I'm not being sarcastic or anything...just genuinely wondering) Because nothing in this life is free. If something is free...you're being a fool, and tool. and belong in a pool with a guy named Zool.
I don't know what you mean, I mentioned that I only place limit orders and trade between 10-200 shares of a given stock....I don't use market orders....
Sorry but I don't understand this whole limit order scalp/cheat thing. If I'm placing a limit order for XYZ at $50.25 and it fills at $50.25 where am I being cheated, thats the price I'm willing to pay... I could see if I'm trading 20,000 shares and my fill is 3 or 5 cents off but I only trade a fraction of shares, so what am I missing ?
you could be missing trades because your limit might not be sent to the most active exchange or re-routed if an offer is sitting on another exchange. There are other games to could be played by those buying the flow to lean on your order as well.