Commissions! Commissions! Commissions!

[Moneyball]

Quote from nyxtrader:

Cost of doing business for being leveraged out. IMO

You can get the same leverage in most cases whether you're paying .003 or .002. Commissions aren't the only thing to consider of course, but all else being equal, .001 can be a substantial amount to some traders.

For newer traders, I agree that it's not worth bickering over .001. The other aspects are more important to consider IMO, the commissions you can always lower if/when you become consistent.

 

[nyxtrader]

Quote from powerfade:

Oops... you just revealed something about yourself

: )

That difference can mean quite a bit of money for successful high volume traders.

Please tell me what I revealed about myself? You can trade more volume than me but I am certain you don't make more than me. Volume has nothing to do with profitability. When I have 10,000 or 20,000 shares and hold for a few points, I don't mind paying 20 to 40 bucks each side plus pass through. My close friend trades between 17mln to 21mln shares a month and doesn't make more.

 

[Moneyball]

Quote from nyxtrader:

Volume has nothing to do with profitability. When I have 10,000 or 20,000 shares and hold for a few points, I don't mind paying 40 to 80 bucks each side plus pass through. My close friend trades between 17mln to 21mln shares a month and doesn't make more.

I agree that volume doesn't have much to do with profitability, but if you do the math, your friend may very well make more than you if he paid .001 less per share- that would make a heck of a difference to him, wouldn't it?

That's the point, to some people, .001 is a big difference. To others, it's not.

 

[nyxtrader]

Quote from Moneyball:

I agree that volume doesn't have much to do with profitability, but if you do the math, your friend may very well make more than you if he paid .001 less per share- that would make a heck of a difference to him, wouldn't it?

That's the point, to some people, .001 is a big difference. To others, it's not.

He still wouldn't make more but that isn't the point. They are taking on some large risk by giving me some high leverage..So in all fairness I don't mind them making some money off me.

 

[nyxtrader]

Quote from Moneyball:



You can get the same leverage in most cases whether you're paying .003 or .002. Commissions aren't the only thing to consider of course, but all else being equal, .001 can be a substantial amount to some traders.

For newer traders, I agree that it's not worth bickering over .001. The other aspects are more important to consider IMO, the commissions you can always lower if/when you become consistent.

You are right. It can make a difference. I am in the process of starting my own prop shop...A true shop at that, with the traders being full backed by me and spliting the profits and their commish will be .003 or .004. I am going to focus on developing quality traders. (Again working on, not sure if it will happen)

So the point being, volume isn't the key to trading. Great trades are.

 

[hedgeking]

nyxtrader what about in this market when you buy 20-40k shares and it falls $3 against you? tell us your stories on that. its hard as hell to get $3-$4 in this market without getting shaken out.the whole idea behind hard core scalping is to reduce your risk and many people don't have the capital to buy 300-500k of stock and hold it for days. i trade many accounts and trade both ways and while overall i make more money holding longer periods of time i have more stress doing it. there's something about being flat every night and waking up fresh every am and ready to fire away. 001 savings is 10k amonth on somebody who does 10 mil amonth vol. thats 120k a year. lets say you're a very very good trader doing that vol and make 500k a year thats a full 22% of his net profits in that .001 savings. don't know many people who would balk at that

 

[nyxtrader]

Quote from hedgeking:

nyxtrader what about in this market when you buy 20-40k shares and it falls $3 against you? tell us your stories on that. its hard as hell to get $3-$4 in this market without getting shaken out.the whole idea behind hard core scalping is to reduce your risk and many people don't have the capital to buy 300-500k of stock and hold it for days. i trade many accounts and trade both ways and while overall i make more money holding longer periods of time i have more stress doing it. there's something about being flat every night and waking up fresh every am and ready to fire away. 001 savings is 10k amonth on somebody who does 10 mil amonth vol. thats 120k a year. lets say you're a very very good trader doing that vol and make 500k a year thats a full 22% of his net profits in that .001 savings. don't know many people who would balk at that

Its clearly is not hard to get a few points. Don't get me wrong I do scalp but not as much as some. Yes, of course I have from time to time where a stock will drop quicker than I get out, I just have to learn from it and move on. I have a lot of conviction with the majority of my trades and a lot of the time I don't get shakin out, I stick to the plan I have. For the most part I can tell if the move against me is real or not. I have large variety of stocks I trade and I know how each one reacts at different levels. The difference between me and the rest, I understand what is going on in a trade and can see it develop. Not 100% but most of the time I am right. I have put a lot of time and energy into getting where i am. Sometimes I forget there is life outside the markets but it has paid off and now I can surely enjoy the rewards now.


Edit: I am not here to brag about anything and if it appears that way, I apologize now. I am here to help and be a resource for others. I won't give all my ideas and my method BUT I sure am available to guide you and answer questions one may have. And hopefully I can learn something too. I dont' know everything but I have a very solid foundation for trading.

 

[niteflite]

so, even for a newbie trader .01/share is too high? what would be ideal

 

[NY0BScalper]

Quote from niteflite:

so, even for a newbie trader .01/share is too high? what would be ideal

.003 for a newbie. Unless you like donating money.

 

[montysky]

Quote from nyxtrader:

You are right. It can make a difference. I am in the process of starting my own prop shop...A true shop at that, with the traders being full backed by me and spliting the profits and their commish will be .003 or .004. I am going to focus on developing quality traders. (Again working on, not sure if it will happen)

So the point being, volume isn't the key to trading. Great trades are.

nyxtrader, you swing big lots. I aspire to be trading like you someday....

Are you based in NYC? When do you expect your shop to be up and running? Affiliate with whom? Please PM me if you don't want to disclose the info here.