10,000 shares at 10AM = $25
25,000 shares at 11AM = $25
That is how the Cap works, $25 max for any single trade.
New Nasdaq Fees (Echo vs. Bright)
- Thread starter esc_trader
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10,000 shares at 10AM = $25
25,000 shares at 11AM = $25
That is how the Cap works, $25 max for any single trade.
This cap rap is crap. The cap IS DEAD. Of the half a dozen listed traders I know that trade over 5 milion shares per month, less than 1% of all trades are capped. Decimalization, growing listed fragmentation, erratic markets, and light volume have virtually eradicated the effectiveness of the cap. Getting filled in size (at a decent price) is a ugly chore today, at least versus two years ago.
Unfortunately, it is true that it is harder to trade in size than it was 2 years ago. But it is not impossible. I know of numerous traders that are significantly over that 1% figure today and for some of them 1/4 to 1/3 of all their trades have a cap. It really all depends on an individual's particular trading style.
The cap only affects about 200-250 of our traders (pair traders mostly, some big bank players), and it is a way to reduce overall costs to them. Many traders do more than 2500 shares at a pop.
I agree that it doesn't matter to most, and yet each person needs to weigh the whole picture when pricing anything.
Robert,
One important question. Does the guy make money? We had a couple of big guns im the past that imploded. Many times big
size does not make big P & L. Our best traders trade 2000 share positions in NYSE. Just curious.
Gene Weissman
Lieber & Weissman Sec., L.L.C.
gweissman@stocktrade.net
One important question. Does the guy make money? We had a couple of big guns im the past that imploded. Many times big
size does not make big P & L. Our best traders trade 2000 share positions in NYSE. Just curious.
Gene Weissman
Lieber & Weissman Sec., L.L.C.
gweissman@stocktrade.net
So you're saying size doesn't matter?
I've seen traders that do size big enough to get a cap rebate be negative P&L at the end of the month and be up thousands with the cap rebate. And I've seen traders who do large size be up and down like yo-yo's day in and day out. And I've seen traders who do size blow out. On the other hand, I've seen traders who trade a few hundred shares of 20-60 stocks a day making 4 figures nearly every day. So, in answer to that age old question, size doesn't matter. What matters is what you do with the size of trade you use
Some people work better with large positions, some with small.cashonly,
My point is exactly what you are saying. Many traders think that big size means big P &L and that is not always the case. It
is much harder to "trade" size especially in this .01 market. If the
Market in IBM is BID 99.89 ASK 99.01, can I buy 10,000 shares at
99.01? Most of the time the answer is "no". In the current market environment(.01 speads) , trading & especially daytrading size , may not mean bigger P & L. I think traders that are trading only for rebates would be wise to trade smaller size and make money off their P & L, not just generate commissions for
their firm.
Gene Weissman
Lieber & Weissman Sec., L.L.C.
gweissman@stocktrade.net
My point is exactly what you are saying. Many traders think that big size means big P &L and that is not always the case. It
is much harder to "trade" size especially in this .01 market. If the
Market in IBM is BID 99.89 ASK 99.01, can I buy 10,000 shares at
99.01? Most of the time the answer is "no". In the current market environment(.01 speads) , trading & especially daytrading size , may not mean bigger P & L. I think traders that are trading only for rebates would be wise to trade smaller size and make money off their P & L, not just generate commissions for
their firm.
Gene Weissman
Lieber & Weissman Sec., L.L.C.
gweissman@stocktrade.net