I wanted to share how my orders are getting handled now that I am paying $5.00 + $.45 per contract. My rates did increase from Cheap Brokerage but please evaluate the evidence and find out through your Monthly Statements how many of your "Market Order" fills are way below the Offer or far above the Bid, there is a reason your Cheap Brokerage Guys are driving $200k Cars!
There's a stock option that's got a $1.16 x $1.40 price, the stock start's to tank and I threw out 25 contracts that got filled at $1.33. I was using two different Clearing Houses to test how badly the fills are at "F-the-Customer Clearing House" I was up pretty good and decided to test out how orders are handled with two different CHs, White Knight and F-the-Client Clearing House".
Testing my theory in a Wild Market, I threw out 25 contracts on a stock that was declining, the Bid was $1.16 x $1.40, my 25 contracts got filled instantly at $1.33 which surprised me.
Why can those Brokerages offer you $.15 or $.35 per Option Contract, they must be really good people looking out for your best interest? Hell No! These assholes can't even keep a Trading Platform that does not crash on the Active Trader, so where is all that money going? I am under no obligation to trade heavily to avoid getting dinked with $300 in platform fees plus all the extras even though my other platform is covered by all my trades. So how do the fills work, if your paying $5 per Option Order or $3.00, your saving money, right?
I had 100 contracts of Company XYZ that's got some volume, each Clearing House has 50 contracts so lets see how the fills went on Tuesday's crazy day.
The Bid is $1.14 x $1.40, Options that are not super traded like Apple's weeklies, this is one of the more mild spreads. The stock begins to tank, I throw out 25 contracts and this new Broker fills them at $1.33, am I seeing things straight because at Brokerage F-the-client, you don't see this!
I sell have to sell my 50 contracts at Brokerage F-the-Client in smaller lots, I throw out 15 contracts and they get filed at 5 at $1.14, 5 at the next level $1.11 and 5 at $1.10!
I wait a few minutes and the XYZ is up a few pennies, the spread is back to $1.17 x $1.47, so I throw out another 25 contracts at the Market(I bought them at $.30 so I am going to make money unless the HFTS Gang kill the Market in that nano second). My 25 contracts get filled at $1.43! I shake my head, can't believe this is real!
Now with 1.17 BATS willing to buy 7 contracts,AMEX, COBE, PHLX and PCX are at $1.14, I am safe, right? I throw out 18 contracts and I get 9 filled at $1.17 and the rest get filled at $1.14(I noticed that none of those exchanges were used except BATS at $1.17, they took the 7 and gave me 2 extra at $1.17 and internalized that order at $1.14 because no prints from any of those Exchanges were used!
To get out of the rest of my contracts with this Broker, I used a limit order to get the rest filled at $1.30 by waiting a few minutes it got filled. You get what you pay for, people who use limit orders on Big Spreads, these Brokerages are great only if you never have to use a Market Order. If your bidding on a Option that's $2.10 x $2.50 and your bidding at $2.20 when $2.10 is already thin, these Brokerages make lots of sense and will save you money. What's scary is when there is a Clearing House that has filled me at $2.16 when I was bidding on the $2.10 x $2.50 stock, that made me shake my head asking "How much money did I actually lose or is "Ignorance Truly Bliss" if we don't care about Slippage?
In one day I saved over $800 in price improvements vs F-the-Client Brokerage, my terms might be harsh but you Traders really need to understand there is a reason they can afford to send you a email saying "Today is $2 Trade a thon!" Or "We are the lowest price, we offer you trades at $.15 or $.35 per contract. They don't make money on your limit orders, their gravy train is when the Market is moving and you need to get on board that stock or option. I can show you 900 trades I made this week, only 6 might have been at the Offer, that's nothing compared to getting filled at the Offer my favorite $3.10 x $3.90 and they fill you at $3.89 on 3 contracts and you get filled at $3.90 on the 27 more. I had to pay up because that stock is hauling ass up and those contracts would eventually get sold at $6.30.
Market Orders are a necessary evil, the question you must ask yourself is, are you paying $500 for your $5.00 +.30 Options or you getting a fair deal? I forgot to mention the buy side of this equation, at F-the-Client Clearing House, I had to use limit orders, the other Brokerage filled them very nicely without using limit orders when stock began to move.
Today's Apple and AGN trades were more examples how your really getting slammed if you don't examine how your Market or even your limit orders are filled. I had a limit-order Bid $3.90 x $4.10 and I use a Limit Order to sell at $4.00 and I get filled at $4.08, that's just weird, if you shop around and get a good Brokerage your going to be amazed how bad those Cheap Brokerages actually screw you over!
There's a stock option that's got a $1.16 x $1.40 price, the stock start's to tank and I threw out 25 contracts that got filled at $1.33. I was using two different Clearing Houses to test how badly the fills are at "F-the-Customer Clearing House" I was up pretty good and decided to test out how orders are handled with two different CHs, White Knight and F-the-Client Clearing House".
Testing my theory in a Wild Market, I threw out 25 contracts on a stock that was declining, the Bid was $1.16 x $1.40, my 25 contracts got filled instantly at $1.33 which surprised me.
Why can those Brokerages offer you $.15 or $.35 per Option Contract, they must be really good people looking out for your best interest? Hell No! These assholes can't even keep a Trading Platform that does not crash on the Active Trader, so where is all that money going? I am under no obligation to trade heavily to avoid getting dinked with $300 in platform fees plus all the extras even though my other platform is covered by all my trades. So how do the fills work, if your paying $5 per Option Order or $3.00, your saving money, right?
I had 100 contracts of Company XYZ that's got some volume, each Clearing House has 50 contracts so lets see how the fills went on Tuesday's crazy day.
The Bid is $1.14 x $1.40, Options that are not super traded like Apple's weeklies, this is one of the more mild spreads. The stock begins to tank, I throw out 25 contracts and this new Broker fills them at $1.33, am I seeing things straight because at Brokerage F-the-client, you don't see this!
I sell have to sell my 50 contracts at Brokerage F-the-Client in smaller lots, I throw out 15 contracts and they get filed at 5 at $1.14, 5 at the next level $1.11 and 5 at $1.10!
I wait a few minutes and the XYZ is up a few pennies, the spread is back to $1.17 x $1.47, so I throw out another 25 contracts at the Market(I bought them at $.30 so I am going to make money unless the HFTS Gang kill the Market in that nano second). My 25 contracts get filled at $1.43! I shake my head, can't believe this is real!
Now with 1.17 BATS willing to buy 7 contracts,AMEX, COBE, PHLX and PCX are at $1.14, I am safe, right? I throw out 18 contracts and I get 9 filled at $1.17 and the rest get filled at $1.14(I noticed that none of those exchanges were used except BATS at $1.17, they took the 7 and gave me 2 extra at $1.17 and internalized that order at $1.14 because no prints from any of those Exchanges were used!
To get out of the rest of my contracts with this Broker, I used a limit order to get the rest filled at $1.30 by waiting a few minutes it got filled. You get what you pay for, people who use limit orders on Big Spreads, these Brokerages are great only if you never have to use a Market Order. If your bidding on a Option that's $2.10 x $2.50 and your bidding at $2.20 when $2.10 is already thin, these Brokerages make lots of sense and will save you money. What's scary is when there is a Clearing House that has filled me at $2.16 when I was bidding on the $2.10 x $2.50 stock, that made me shake my head asking "How much money did I actually lose or is "Ignorance Truly Bliss" if we don't care about Slippage?
In one day I saved over $800 in price improvements vs F-the-Client Brokerage, my terms might be harsh but you Traders really need to understand there is a reason they can afford to send you a email saying "Today is $2 Trade a thon!" Or "We are the lowest price, we offer you trades at $.15 or $.35 per contract. They don't make money on your limit orders, their gravy train is when the Market is moving and you need to get on board that stock or option. I can show you 900 trades I made this week, only 6 might have been at the Offer, that's nothing compared to getting filled at the Offer my favorite $3.10 x $3.90 and they fill you at $3.89 on 3 contracts and you get filled at $3.90 on the 27 more. I had to pay up because that stock is hauling ass up and those contracts would eventually get sold at $6.30.
Market Orders are a necessary evil, the question you must ask yourself is, are you paying $500 for your $5.00 +.30 Options or you getting a fair deal? I forgot to mention the buy side of this equation, at F-the-Client Clearing House, I had to use limit orders, the other Brokerage filled them very nicely without using limit orders when stock began to move.
Today's Apple and AGN trades were more examples how your really getting slammed if you don't examine how your Market or even your limit orders are filled. I had a limit-order Bid $3.90 x $4.10 and I use a Limit Order to sell at $4.00 and I get filled at $4.08, that's just weird, if you shop around and get a good Brokerage your going to be amazed how bad those Cheap Brokerages actually screw you over!
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