Commission Free Broker Question

C

Corso482

I want to go live with my system, but don't want to risk a lot of money. So I'm considering going with Brokerage America. They've got free market orders. Now before all of you warn me about crappy fills, let me tell you a little bit about my system and you tell me if the fills still matter:

I only deal with 1mm share a day liquid stocks.
I only swing trade, hold for about a week, so I'm not scalping here.
I only buy/sell at the market open

Ohhh, and perhaps this is important-- I'll only be using about $2000, I'll need to be dealing in odd lots.

Sooooo...am I gonna get screwed if I use a commission free broker to execute market open orders with odd lots???
 
You may have commission free, but say you lose 10 cents on 200 shares with a crappy market fill..you just paid 20 bucks indirectly. If you trade 1000 shares, now you can see where I'm going.

Something to think about.

I'd think that a per share broker would be your better bet. You can place limit orders and you will most likely pay less in commissions if you are trading minimal shares.

Chris
 
Quote from Corso482:

I want to go live with my system, but don't want to risk a lot of money. So I'm considering going with Brokerage America. They've got free market orders. Now before all of you warn me about crappy fills, let me tell you a little bit about my system and you tell me if the fills still matter:

I only deal with 1mm share a day liquid stocks.
I only swing trade, hold for about a week, so I'm not scalping here.
I only buy/sell at the market open

Ohhh, and perhaps this is important-- I'll only be using about $2000, I'll need to be dealing in odd lots.

Sooooo...am I gonna get screwed if I use a commission free broker to execute market open orders with odd lots???
More...
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Since its 2k;you might try this swing trade-non market open move.

Could get most all your time frames green [bullish];
with lots of due diligence, go long on a red [bearish -5 minute ]candle.

They[BA] kept me a bit too long on telephone hold to open an account
but Datek gave me good fills which is part of swing trading.
 
Quote from Corso482:

Sooooo...am I gonna get screwed if I use a commission free broker to execute market open orders with odd lots???
More...

Sure, any time somebody promises you something for nothing, you should jump on it. Particularly when there's serious money and investing involved. Or, you could just wait until you get one of those phone calls promising 100%+ annual returns with practically no risk. . .:p

That reminds me of one of my favorite Dilbert strips. Dogbert says "The Latin word for close your eyes and open your mouth is 'Prospectus'."

 
Quote from TGregg:



Sure, any time somebody promises you something for nothing, you should jump on it. Particularly when there's serious money and investing involved. Or, you could just wait until you get one of those phone calls promising 100%+ annual returns with practically no risk. . .:p

That reminds me of one of my favorite Dilbert strips. Dogbert says "The Latin word for close your eyes and open your mouth is 'Prospectus'."
More...

Here's another... Tax Shelter: "A depression in the earth surrounded by doctors into which they will throw their wallet if you tell them it's tax-deductible."
 
Quote from Corso482:

I want to go live with my system, but don't want to risk a lot of money. So I'm considering going with Brokerage America. They've got free market orders. Now before all of you warn me about crappy fills, let me tell you a little bit about my system and you tell me if the fills still matter:

I only deal with 1mm share a day liquid stocks.
I only swing trade, hold for about a week, so I'm not scalping here.
I only buy/sell at the market open

Ohhh, and perhaps this is important-- I'll only be using about $2000, I'll need to be dealing in odd lots.

Sooooo...am I gonna get screwed if I use a commission free broker to execute market open orders with odd lots???
More...

I would say that using brokerage america would be ok as long as you are only doing odd lots. Thats because many ecns do not accept odd lot fills so that would really increase your slippage if you went to a direct access broker, like Ib. But once you increase to 100 shares, then I'd switch right away. Because thats only $1 per side with IB and I'm sure you are losing at least 1 cent per trade using brokerage america.
 
Quote from Corso482:


Ohhh, and perhaps this is important-- I'll only be using about $2000, I'll need to be dealing in odd lots.

More...

I'm a small swing trader too. I highly recommend IB for this type of trading.
 
Quote from Htrader:



I would say that using brokerage america would be ok as long as you are only doing odd lots. hats because many ecns do not accept odd lot fills so that would really increase your slippage if you went to a direct access broker, like Ib.
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This is a very good concern. However, I frequently trade odd lots with IB and have not experienced any problems. My fills have been exactly where I would have expected with a round lot or better.:confused: I do SEEM to be routed to TMBR more often.

I've only been with IB a month, but I am pleasantly surprised at how well everything has gone so far.
 
The only reason I'm considering this bizarre commission free route is this--

My system's money management dictates I divide my capital into 10ths. Now let's say the avg share price of stocks I buy is $40, so if I buy minimum 100 shrs, that $4,000 per stock. Then times 10 for my total capital is $40,000 dollars. That's what I'd need if wanted to do this thing completely right.

As you can see, I'd much prefer to get this system started with $2,000 as opposed to $40,000 if at all possible. And even considering the risks associated with a free brokerage, are those risks outweighed by the real risk of having to put up $38,000 more money?

Oh, did I mention I don't have $40,000? It would probably take me 5 years to save that money up, I'm a friggin college student.
 
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