Comission and Bullet Rates
- Thread starter Hitnruntrader
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Have you ever traded with Ameritrade? Think about this 2 cent slip on 10K shares = $200+10.99 Commission=$210.99.
Most firms 10K shares 1 cent per share with $25 cap= $25
210.99-25=185.99
2 cent slip would be pretty good too (for a firm selling flow).
Think about your REAL costs.
And what does that mean passed out? Were you in the testing center and fainted from stress or what? Anyway what happened after that? Did you wake up and pass the test or what?
Chad Lapides
Yes, I have traded with Ameritrade, there is no such thing called SLIP or Hidden charges. They just charge $10.99 for unlimted shares for 100 shares or 10,000 shares, including stop and limit orders.
I have checked your echotradeonline rates. It says All NYSE and AMEX orders will never be charged more than $25 regardless of size. But what about NASDAQ stocks?
if u can give Nasdaq at $25 on 10k shares that would be great. So please let me know.
Reddy
(http://www.ameritrade.com/services/index.html?startpage=commissions.fhtml)
Yes, I have traded with Ameritrade, there is no such thing called SLIP or Hidden charges. They just charge $10.99 for unlimted shares for 100 shares or 10,000 shares, including stop and limit orders.
I have checked your echotradeonline rates. It says All NYSE and AMEX orders will never be charged more than $25 regardless of size. But what about NASDAQ stocks?
if u can give Nasdaq at $25 on 10k shares that would be great. So please let me know.
Reddy
(http://www.ameritrade.com/services/index.html?startpage=commissions.fhtml)
He is referring to an inferior fill. Ameritrade sells its order flow.
Thank you Hardrock. By slip I was referriing to a well known trading term called slippage. It refers, among other things to the cost of an inferior fill or a delayed quote or delay in order processing, etc.
This I found on the website link that you provided.
This I found on the website link that you provided.
Chad hit the nail right on the head.
Ameritrade is known for selling it's paper. It's how they make their money.
If you wanted to buy a stock and it's at 32.55 bid by 32.63 offer
With Ameritrade don't be surprised to get a confirmation of 32.65 for your 10,000 shares. As they have relationships with certain brokers who pay Ameritrade a % for sending orders to the brokers even when they aren't at the inside bid/ask. On 10,000 shares that could easily be $600 bucks if that slippage was .06
There is no such thing as a free lunch
Robert
Ameritrade is known for selling it's paper. It's how they make their money.
If you wanted to buy a stock and it's at 32.55 bid by 32.63 offer
With Ameritrade don't be surprised to get a confirmation of 32.65 for your 10,000 shares. As they have relationships with certain brokers who pay Ameritrade a % for sending orders to the brokers even when they aren't at the inside bid/ask. On 10,000 shares that could easily be $600 bucks if that slippage was .06
There is no such thing as a free lunch
Robert
http://ameritrade.com/html/be_faq.html
read a few lines down....on web page above.
Do brokers receive compensation for routing orders to particular market makers?
Yes. The majority of exchanges and market makers provide incentives for brokers to route orders to them. Typically, this involves a rebate or payment to the broker for routing orders to that exchange or market maker. This is commonly referred to as payment for order flow.
Does Ameritrade receive payment for order flow?
Ameritrade, Inc. receives payment for order flow from some liquidity providers. This payment is used to offset the costs of doing business and ultimately helps to reduce the overall cost to our clients.
read a few lines down....on web page above.
Do brokers receive compensation for routing orders to particular market makers?
Yes. The majority of exchanges and market makers provide incentives for brokers to route orders to them. Typically, this involves a rebate or payment to the broker for routing orders to that exchange or market maker. This is commonly referred to as payment for order flow.
Does Ameritrade receive payment for order flow?
Ameritrade, Inc. receives payment for order flow from some liquidity providers. This payment is used to offset the costs of doing business and ultimately helps to reduce the overall cost to our clients.
Thanks Robert. That was well said.
Ameritrade is not self clearing and as such needs to pay for it. Even if it cost the 2 tenths of a cent per shaer to clear, they would be losing $9.01 per 10K share trade. Do you really think they would take out an INCA offer if they knew it was going to cost them 2/10 of a cent plus what they have to pay to INCA for taking liquidity? No way. They sell that flow to an MM who pays them a half cent per share for the ability to make money off the dumb money traders that Ameritrade has as clientele.
Ameritrade is not self clearing and as such needs to pay for it. Even if it cost the 2 tenths of a cent per shaer to clear, they would be losing $9.01 per 10K share trade. Do you really think they would take out an INCA offer if they knew it was going to cost them 2/10 of a cent plus what they have to pay to INCA for taking liquidity? No way. They sell that flow to an MM who pays them a half cent per share for the ability to make money off the dumb money traders that Ameritrade has as clientele.