Is Speedtrader reliable / shady?

B

buysellhold

I'm looking for a broker with a decent HTB inventory for low-priced stocks and speedtrader came up as a suggestion. Have people used them and do they appear to be reliable?

I've noticed a couple of red flags so far. Their founder/CEO appears to be a "bro" with a few lawsuits bubbling around him and their online account application seemed a bit shady (for some questions, they had only one "right" answer and forced you to pick it instead of giving you a choice). I gave their demo platform (DAS Trader) a spin and it seems rickety but potentially tolerable; however, finding out that DAS is owned and operated by his ex-wife didn't exactly raise my confidence.

Do people have an opinion on these guys? If not for the red flags, I would've just opened an account and given them a shot, but after writing the above paragraph, I'm a bit concerned about them stealing my money or my identity.
 
You took a strong directional position in the market, and the market is moving against you.

The weather right now is so nasty, that your ISP's localhub is flickering like a hurricane lantern, and has dropped signal (>1minute outage) 3 times in the last 24-hours.

Your computer's video card/CPU/RAM has developed a noisy fan, and you're starting to smell that acrid "Something electrical is burning" smell.

Your view of the local weather radar has a major cell (one of those *purple* jobs) about to park itself right over your house.

Your battery-backup squeals twice, then your screens go black, your house lights flicker and go out, and you smell burning plastic from (what's left of) your computer. The lack of interior/house sounds makes it suddenly clear that the weather outside makes travel by car "not-an-option"....
... ....
...Is now the time to have an issue with your platform/broker, too?

ANY of these situations can be worked around, with a little ingenuity/forethought -- but a whole *stack* of 'em? I myself have faced 3-4 at once -- boy *that* is when "keeps cool under pressure" becomes more than just a phrase.

But one thing you DO NOT WANT in there, is to have your platform bend you over a barrel and FUQUE you from behind. You just don't want that.

My advice? Don't think about what you want from your broker on a Good Day ---- think about what you want from your broker on a BAD DAY.
 
buysellhold said:
I'm looking for a broker with a decent HTB inventory for low-priced stocks and speedtrader came up as a suggestion. Have people used them and do they appear to be reliable?

I've noticed a couple of red flags so far. Their founder/CEO appears to be a "bro" with a few lawsuits bubbling around him and their online account application seemed a bit shady (for some questions, they had only one "right" answer and forced you to pick it instead of giving you a choice). I gave their demo platform (DAS Trader) a spin and it seems rickety but potentially tolerable; however, finding out that DAS is owned and operated by his ex-wife didn't exactly raise my confidence.

Do people have an opinion on these guys? If not for the red flags, I would've just opened an account and given them a shot, but after writing the above paragraph, I'm a bit concerned about them stealing my money or my identity.
More...
you got the red flags. what else do you need?
 
Yeah, I know what you guys mean -- writing down the list of red flags for the original post definitely caused me to reflect on them some more.

That said, perhaps people who've used them can share their experience. Shorting crap stocks is a tough segment to find good brokerage for -- a lot of the larger places don't want that business and so place stringent restrictions (no shorting below $X) or have crappy borrow availability -- so going with a more dubious broker may be the name of the game here. So if some people with first-have experience have feedback, perhaps that can clear things up.
 
buysellhold said:
Yeah, I know what you guys mean -- writing down the list of red flags for the original post definitely caused me to reflect on them some more.

That said, perhaps people who've used them can share their experience. Shorting crap stocks is a tough segment to find good brokerage for -- a lot of the larger places don't want that business and so place stringent restrictions (no shorting below $X) or have crappy borrow availability -- so going with a more dubious broker may be the name of the game here. So if some people with first-have experience have feedback, perhaps that can clear things up.
More...

Shorting "crap" stocks is a tough segment because as you say they are "crap". That would imply a hard to borrow from the start and also often imply a higher volatility which means more risk for the broker.

Seems to me you want to play with fire:
A: Borrow at a high rate low priced stocks;
B: go with a a more dubious broker.

I'd suggest you head to Vegas instead
 
eastern_warrior said:
Shorting "crap" stocks is a tough segment because as you say they are "crap". That would imply a hard to borrow from the start and also often imply a higher volatility which means more risk for the broker.

Seems to me you want to play with fire:
A: Borrow at a high rate low priced stocks;
B: go with a a more dubious broker.

I'd suggest you head to Vegas instead
More...
most firms as a house policy do not allow shorting of low priced stocks. if they allow you, if you are a short term trader a high rate is not a particular barrier for a short term trader.
worse is that they are not automated. you waste precious minutes on the phones to borrow the shares and to get the order off. you will end up mostly missing the market, if you are any good.
 
zderg, I agree (mostly) and if you look at my posts, you'll notice that I never said anything about rates, just about borrow availability. I'm currently using a couple of brokers (IB & ETrade) which have reasonable availability but want to add more HTB inventory to the mix when those brokers don't have anything available. Do you have suggestions on where I should look then, where there's decent inventory and no house policy against low-priced stocks (or at least the limit is set low)?

As far as borrow rates, I accept paying a lot though IB's policy of rounding up the price to the nearest dollar means that I was effectively paying a 400% / year on a stock which fell to 0.20 (at listed 80% / year) which is pretty rough for a play which takes a few weeks to resolve. But I'm still mostly looking for availability, not rates.
 
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