Comission and Bullet Rates

Caliber's post is incomplete................

You forgot to mention the cost of maintaining leverage (or even having the leverage to run a firm) and the risk associated with using the leverage.

What if a trader who has all the risk (like Samba says)..... lets say 25k at stake.......... and got stuck in a Emulex type trade (ie: DRYR after hrs 2 wks ago). It is improprable in this market, but there still is a chance it could happen. A prop trader only has their equity in the account at risk and this must be taken into consideration.

Believe it or not....It is still possible to lose more than you have in your prop cap. account. Although, I definitely think that a trader who shoulders more risk (larger cap. contribution) should get a better rate.

Banker
 
Quote from calibertrader:



Hey Samba, outside of you breaking up your posts into several pieces everytime you have something to say to prop up your post count (Moderator should take a look at this), why don't you go out and start a prop firm, and offer the low commissions you imply can exist. We will all join your firm and make you a millionaire because your costs will be close to zero, and the 1/10 commissions you'll charge us will make the rest of us rich because we'll get to keep everything we make. Basically you and everyone else who thinks the clearing firms have it easy on the cost side are morons!!!!! Go try renting space, running all the T-1's, buying all the PC's and software, hiring the tech, accounting, trade support, HR, etc... employees, and paying the self clearing fee's and exchange membership fee's, and tell me what your costs will be. Then tell me how many shares you would need monthly just to cover those expenses, and then we'll see how cheap it is to run an operation and give out 1/10th rates. Here's a start for you, $250,000 in expenses a month which assumes you run a skeleton crew hoping for no major problems to arise, you will need the firm to generate 250,000,000 shares a month to breakeven. Now, go talk to a clearing firm, and you'll see that their expenses are much higher than that, and in the current enviroment those volume numbers are extraordinary. Plus, what firm do you think will want to run just to break even or make a couple of grand? None, that's right, just like you can probably pay $1 for the box of cereal you pay $4 for, Kellogs is not there to make no money. And firms have to build in cushions to protect from current enviroments where they are taking hits left and right. You still think those rates are possible.

Now, don't get me wrong, I would love to pay those rates as well as give them out, but as you can see, they are impossible.
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1) Are you out of your mind!?!?!?! 250k a month in costs? give me a break! And why don't you go back and read my post, I'm being generous and giving an example off of .002 clearing costs which is plenty. Don't be posting bullshit trying to counter that. I have no argument with you that running a clearing operation is a competetive business, I'm talking specifically about the LLCs and to a lesser degree, the brokerages. The firms are doing well more than breaking even as you know. And the OWNERS have plenty of cushion for any losses in this market.
2) why the hell would I care about my 'post count'?
3) Why are SOME PEOPLE so touchy when I OR ANYONE ELSE MENTIONS THAT IT'S TOTALLY POSSIBLE TO GET ALL-IN RATES WELL BELOW .01/SHARE????? again, for the 20th time, pointdirex is offerring .005/share, etrade pro is offerring ~.0045, I'm trading at .0035. And if you go do a search on this thread, plenty of people doing decent volume (40k+/day) are trading no more than .005, there are several posts by people stating they trade at .035, and why would anyone lie about this, if you look at some of them, it's pretty obvious they're normal traders without any agenda. The only people getting really touchy about these posts are people who don't want this information out: people with interests in firms.
4) Calibertrader, you sound like someone with an interest in a firm. Look, I'm not saying that guys doing 5k-10k a day should get these rates, but it's my observation people doing normal volume 40, 80, 150k/day are trading at .005, .0035 type rates. Firms are still making a lot of money off traders at these rates. And how come you're not bashing Etrade pro and Pointdirex and telling them to close up shop because according to what you're saying, at their published rates they're going to go broke in next month!
 
Quote from sambatrade:



1) Are you out of your mind!?!?!?! 250k a month in costs? give me a break! And why don't you go back and read my post, I'm being generous and giving an example off of .002 clearing costs which is plenty. Don't be posting bullshit trying to counter that. I have no argument with you that running a clearing operation is a competetive business, I'm talking specifically about the LLCs and to a lesser degree, the brokerages. The firms are doing well more than breaking even as you know. And the OWNERS have plenty of cushion for any losses in this market.
2) why the hell would I care about my 'post count'?
3) Why are SOME PEOPLE so touchy when I OR ANYONE ELSE MENTIONS THAT IT'S TOTALLY POSSIBLE TO GET ALL-IN RATES WELL BELOW .01/SHARE????? again, for the 20th time, pointdirex is offerring .005/share, etrade pro is offerring ~.0045, I'm trading at .0035. And if you go do a search on this thread, plenty of people doing decent volume (40k+/day) are trading no more than .005, there are several posts by people stating they trade at .035, and why would anyone lie about this, if you look at some of them, it's pretty obvious they're normal traders without any agenda. The only people getting really touchy about these posts are people who don't want this information out: people with interests in firms.
4) Calibertrader, you sound like someone with an interest in a firm. Look, I'm not saying that guys doing 5k-10k a day should get these rates, but it's my observation people doing normal volume 40, 80, 150k/day are trading at .005, .0035 type rates. Firms are still making a lot of money off traders at these rates. And how come you're not bashing Etrade pro and Pointdirex and telling them to close up shop because according to what you're saying, at their published rates they're going to go broke in next month!
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It's .005 per share plus ECN & DOT Fee's. I just looked at their rates, and basically it comes out to 1 cent a share, and those are rates for internet customers not in-house traders. They also don't provide you the leverage that a prop firm does. So you have to take alot into consideration before making a blanket statement about rates. If you have the capital necessary to trade w/o running into margin problems, and take big positions, then these firms make sense. But most traders on this board trade prob under 1000 shares at a clip, they want the leverage cause they can't put up 50 - 100K, and they want the in office setup. For all that, you're not gonna get the rates you described for 50K a day.

Do me a favor, try and start a clearing firm and tell me if you can keep your expenses under 250K a month for 100 traders trading in your office.

This has been beaten to death earlier I believe in this thread by someone who was spewing the same rates you are, and no one here was able to find a firm that would give them those rates and provide them with the seat in their office. If they were, then alot more people would come to defend you, and they are not.

Provide us with the name of the firm you work for, and I'll refer traders to them for .0035 all inclusive who trade 40 - 50K a day.
 
Quote from calibertrader:


Provide us with the name of the firm you work for, and I'll refer traders to them for .0035 all inclusive who trade 40 - 50K a day. [/B]
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why are you constantly exaggerating things like .1/10 commission costs and .0035 for 40-50k/day? if you want to talk about this then quit twisting what people say. I said people doing decent volume of ~40k should not be paying .01, I didn't say .0035. What I did say was as the volume goes up, rates come down. Ballpark, guys doing 40-80k are paying .005 and guys around 100-150k+ are paying .0035 or less. Why do you care what firm I trade at? What difference does that make? If you think i'm recruiting for anyone, then read all my past posts and I think it'll be pretty obvious to you that I'm not.

And by the way, you never answered my question as to why you're so defensive when people talk about the rates their getting? Do YOU work for a firm?
 
Quote from sambatrade:



why are you constantly exaggerating things like .1/10 commission costs and .0035 for 40-50k/day? if you want to talk about this then quit twisting what people say. I said people doing decent volume of ~40k should not be paying .01, I didn't say .0035. What I did say was as the volume goes up, rates come down. Ballpark, guys doing 40-80k are paying .005 and guys around 100-150k+ are paying .0035 or less. Why do you care what firm I trade at? What difference does that make? If you think i'm recruiting for anyone, then read all my past posts and I think it'll be pretty obvious to you that I'm not.

And by the way, you never answered my question as to why you're so defensive when people talk about the rates their getting? Do YOU work for a firm?
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I think my profile makes it pretty clear that I am a managing partner. What upsets me, is that I have to deal with people asking for those rates that you're implying exists, when they truly do not for the general trading population. None of the traders that quote these rates for me ever seem to find a shop that'll give it to them, and then come to work for me anyway. So the reason I ask where you work, is I'll gladly send them there if it's really true.

Most likely the rates u quote is the base rate, but then the firm attach's the ECN or DOT pass thru that brings the rates up to what most of the prop firms charge, and even in some cases desk fee's. And the rates you got were probably from a friend that hooked you up, and most don't have those types of friends. So, if the rate exists, please share where we can all go to get them, otherwise stop spreading your crap around. PROVE IT!!!!!
 
If you read Sambatrade's posts, and then read tickerwatchers posts from the beginning of this thread, you'll see quite a bit of similarity, in the writing style, sarcasm, and comebacks.
 
Quote from calibertrader:

If you read Sambatrade's posts, and then read tickerwatchers posts from the beginning of this thread, you'll see quite a bit of similarity, in the writing style, sarcasm, and comebacks.
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wow, are you implying that I'm tickerwatcher? Let's talk to whoever runs Elitetrader and you can have them answer this question directly.

Still stumped huh?

You're not addressing the topic of discussion and are always exaggerating and countering with tertiary arguments.

Look, I don;t know who you are, all I know is by the way you talk you are definately someone who benefits from charging people high commissions. I think what's fair is that for the rates I'm talking about (<.005 for > 40k/day) it's for people in my position who have been around a bit, don't require maintenance, and are doing decent volume. Not new trainees who don't know what a bid is and are doing 5k/day. For you to argue against this given what people who have been around a while all know, is pretty ridiculous.
 
Quote from sambatrade:



wow, are you implying that I'm tickerwatcher? Let's talk to whoever runs Elitetrader and you can have them answer this question directly.

Still stumped huh?

You're not addressing the topic of discussion and are always exaggerating and countering with tertiary arguments.

Look, I don;t know who you are, all I know is by the way you talk you are definately someone who benefits from charging people high commissions. I think what's fair is that for the rates I'm talking about (<.005 for > 40k/day) it's for people in my position who have been around a bit, don't require maintenance, and are doing decent volume. Not new trainees who don't know what a bid is and are doing 5k/day. For you to argue against this given what people who have been around a while all know, is pretty ridiculous.
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Where are all these people? You're the only one defending your point, and so far alot more people have told you the same thing I have, then vice versa. And if you really cared about all these traders, you would tell us who you trade with, rather then trying to create headaches for those who run legitamite businesses, because you couldn't make it as a trader.
 
Hey Samba let me ask you this....I have 400K in one particualr retail direct acces broker. I trade remote, and do about 35K per day or about 650K per month volume. I currently receive flat fee trading of 8 dollars per ticket + ecn fees.

ECN fees as follows

ARCA .0025
INCA .003
ISLD .003
NYSE .005

No liquidity rebates...


I have other accounts with other brokers but my question is do you think this is a good deal with this broker? Do you think based on volume I can command a better schedule or do you think based on account size I can command a better schedule or based on both? Thanks.
 
Quote from Harry123:

Hey Samba let me ask you this....I have 400K in one particualr retail direct acces broker. I trade remote, and do about 35K per day or about 650K per month volume. I currently receive flat fee trading of 8 dollars per ticket + ecn fees.

ECN fees as follows

ARCA .0025
INCA .003
ISLD .003
NYSE .005

No liquidity rebates...


I have other accounts with other brokers but my question is do you think this is a good deal with this broker? Do you think based on volume I can command a better schedule or do you think based on account size I can command a better schedule or based on both? Thanks.
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If you go to Samba's firm, you can get way better. But then, Samba won't tell us who this firm is. Maybe it's Shill Securities we're all been raving about.
 
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