SCALPERS - Any around?
- Thread starter Aranha
- Start date
Magna
Administrator
Aranha,
they must have LOW RATES to trade, otherwise It would kill their profits to trade using a regular trader fee.
Not true, not if you are trading size. And good scalpers trade size, minimum 1000sh, often 3000-5000sh. Obviously, you have to have a very liquid stock to get in 'n out smoothly with that kind of size, but there are a number of those like CSCO, MSFT, DELL, QQQ, etc.
In fact, if you are not trading size then what's the point of scalping .10 and .15, even if you have cheap commissions?
they must have LOW RATES to trade, otherwise It would kill their profits to trade using a regular trader fee.
Not true, not if you are trading size. And good scalpers trade size, minimum 1000sh, often 3000-5000sh. Obviously, you have to have a very liquid stock to get in 'n out smoothly with that kind of size, but there are a number of those like CSCO, MSFT, DELL, QQQ, etc.
In fact, if you are not trading size then what's the point of scalping .10 and .15, even if you have cheap commissions?
Most scalpers I know perform over 75 trades a day.
The number of shares you are right. It goes between 2.500 to 5.000. Only high liquidity stocks.
The point is that if you don't have cheap comissions, you're dead.
I just want to know if there is any SCALPERS around, and with which firms they're trading with. That's all.
Like a survey.
Because I'm interested too in open an account with a firm to start scalping, and I was looking for an advice.
If you or anybody knows a firm that can offer good rates for direct access, please recommend me...
Some guys like to recommend firms to get a rebate from their own comissions..No problem about that! Just tell me the anme of the firm and your name, And I will tell them that you made the referral.
Good luck
The number of shares you are right. It goes between 2.500 to 5.000. Only high liquidity stocks.
The point is that if you don't have cheap comissions, you're dead.
I just want to know if there is any SCALPERS around, and with which firms they're trading with. That's all.
Like a survey.
Because I'm interested too in open an account with a firm to start scalping, and I was looking for an advice.
If you or anybody knows a firm that can offer good rates for direct access, please recommend me...
Some guys like to recommend firms to get a rebate from their own comissions..No problem about that! Just tell me the anme of the firm and your name, And I will tell them that you made the referral.
Good luck
To have good scalping you need great, fast, software with connection to many ECN's. Quick Order routing and Fast hot key capable. I trade with the watcher now. Its great software. But my commissions now 1.2/share plus ECN fees. I have found a new company, www.pointdirex.com that has commissions as low as .0075/share. I am using their Level One software and it the fastest order routing i have seen. I am now looking to open an account with their 4.13 product.
I also trade with PointDirex and am already using their 4.13 platform. Better still, their Platinum platform is rolling out next week I believe (or sometime very soon) and has some major feature enhancements over 4.13. As I have stated before, the executions and order entry capabilites are truly amazing.
Regarding the low commish/size issue I think the two first posts missed the main issue. Its not so much a matter of size, but rather how you accumulate the shares of a size position. If you are paying 10 bucks a ticket or 1 penny per share you pay the same on 1000 share order (obviously). Depending on conditions I often trade size and am mostly a scalper. However with the whippy unpredictable post decimal/SuperSOES Naz markets, where the bid can evaporate 35 cents in 5 seconds on no volume in higly liquid stocks, I am more wary of opening my 2000 share position with a 2000 share order. I do not like a minus $750 in my P & L on a quick 30 cent BS move against me and will avoid it whenever possible (obviously)
Rather I like to build (even on a momentum trade) the position over a minute or two (or several) by bidding/offering 100-300 share blocks at a time. Assuming I am buying, I will likely take the offer on some of these lots, while simultaneously bidding out several lots at or below the bid. If I am really watching the L2 screen and tape, I can often accumulate decent amount of the position 3-15 cents (average) below what was the initial offer price price while the stock is flipping around.
This way my average cost is much better than what it would have been had I just taken the offer for all 2000 shares, and I will not take as much heat in my mark to market P & L if I open the position with 2000 shares and the position moves against me on a BS wiggle. Any way this is just my "one cents" worth on the penny per share vs per ticket issue lol.
Finally, you could say the downside of this accumulation style might be that you potentially miss the "scalp move" if it happens whan you only have 300 shares or whatever. While this certainly happens, the order entry and execution ability of the Direx platform enables me to deal with it much more efficiently. If the market starts to move fast and I want in or out, I can start taking offers hitting bids faster than most so I can often still get a decent number of shares quickly. And when you want to get short in a tanking Naz stock, well that's another story but suffice it to say....I get short.
Regarding the low commish/size issue I think the two first posts missed the main issue. Its not so much a matter of size, but rather how you accumulate the shares of a size position. If you are paying 10 bucks a ticket or 1 penny per share you pay the same on 1000 share order (obviously). Depending on conditions I often trade size and am mostly a scalper. However with the whippy unpredictable post decimal/SuperSOES Naz markets, where the bid can evaporate 35 cents in 5 seconds on no volume in higly liquid stocks, I am more wary of opening my 2000 share position with a 2000 share order. I do not like a minus $750 in my P & L on a quick 30 cent BS move against me and will avoid it whenever possible (obviously)
Rather I like to build (even on a momentum trade) the position over a minute or two (or several) by bidding/offering 100-300 share blocks at a time. Assuming I am buying, I will likely take the offer on some of these lots, while simultaneously bidding out several lots at or below the bid. If I am really watching the L2 screen and tape, I can often accumulate decent amount of the position 3-15 cents (average) below what was the initial offer price price while the stock is flipping around.
This way my average cost is much better than what it would have been had I just taken the offer for all 2000 shares, and I will not take as much heat in my mark to market P & L if I open the position with 2000 shares and the position moves against me on a BS wiggle. Any way this is just my "one cents" worth on the penny per share vs per ticket issue lol.
Finally, you could say the downside of this accumulation style might be that you potentially miss the "scalp move" if it happens whan you only have 300 shares or whatever. While this certainly happens, the order entry and execution ability of the Direx platform enables me to deal with it much more efficiently. If the market starts to move fast and I want in or out, I can start taking offers hitting bids faster than most so I can often still get a decent number of shares quickly. And when you want to get short in a tanking Naz stock, well that's another story but suffice it to say....I get short.
I'm in the same position, in that I have found that I'm more comfortable(and more successful) scaling into positions -- however, the per ticket costs can start to dilute the benefit derived. I would like to ask DATTrader if he could elaborate on his experience with PointDirex. I would be interested, based on the commission structure I saw on their page, if they are reliable, etc. DATTrader, can you give us some details on your experience?
I used to trade with AB Watley. The per ticket charges can kill you. Per share is definately the way to go IMO, especially if you like to scale in and out.
I have found Point Direx to be extremely reliable considering the internet version of the software is relatively new (November). Previously the software was written for Direct connections only (eg trading on a floor) as Point Direx has historically been a proprietary trading firm. I can tell you that I was one of the first to trade the internet based platform and it has been remarkably stable for me ( I am NY, PD is in FLA)
Gene I agree with you that there is no reason in the world to consider IB with the competitive commission structure of PD considering the (in my opinion) vastly superior order entry/execution capabilities of PD.
TO answer your question Gene, the way the order entry interface works, I can enter bids offers very efficiently (ie quickly). So when accumulating say 500 shares of a stock, I will usually take the offer on a 100 or 200, bid out 200 at the bid price, bid out 100 at the bid minus a cent, and bid out a 100 at the bid minus a few cents etc. Often, as the stock is wiggling around within a 5-10 cent range, I can get many shares passively (cheaper) than by taking the offer on all 500 to open the position.
With 1 cent spreads, I think we are all a little guilty of the "Oh heck I will just pay the offer price its only a penny more" syndrome. But when you consider that you can often acquire a good chunk of the position at or slightly below the bid if you give it a few seconds, it can start to add up.
For example, assume 10000 shares a day traded (thats ten 500 share trades with round trip). THen assume you can get a penny better price on 1/3 of these shares with better execution features/tactics I've just described. That's about $7,000 a year in reduced commissions if I do my math right, which based on what I have seen since converting to PD is not unrealistic. FInally, this ignores the impact of getting stock at the offer or selling it to the bid when the market is moving quickly which the PD platform is simply awesome at. If starts to move fast, I am getting in or out way faster than I used to that is for sure. Hope that helps.
Gene I agree with you that there is no reason in the world to consider IB with the competitive commission structure of PD considering the (in my opinion) vastly superior order entry/execution capabilities of PD.
TO answer your question Gene, the way the order entry interface works, I can enter bids offers very efficiently (ie quickly). So when accumulating say 500 shares of a stock, I will usually take the offer on a 100 or 200, bid out 200 at the bid price, bid out 100 at the bid minus a cent, and bid out a 100 at the bid minus a few cents etc. Often, as the stock is wiggling around within a 5-10 cent range, I can get many shares passively (cheaper) than by taking the offer on all 500 to open the position.
With 1 cent spreads, I think we are all a little guilty of the "Oh heck I will just pay the offer price its only a penny more" syndrome. But when you consider that you can often acquire a good chunk of the position at or slightly below the bid if you give it a few seconds, it can start to add up.
For example, assume 10000 shares a day traded (thats ten 500 share trades with round trip). THen assume you can get a penny better price on 1/3 of these shares with better execution features/tactics I've just described. That's about $7,000 a year in reduced commissions if I do my math right, which based on what I have seen since converting to PD is not unrealistic. FInally, this ignores the impact of getting stock at the offer or selling it to the bid when the market is moving quickly which the PD platform is simply awesome at. If starts to move fast, I am getting in or out way faster than I used to that is for sure. Hope that helps.
I scalp the emini ES and NQ. Both generate about 10-15 RT per day. I have very close profit objectives and as a result, the commission IS very important as it is a per contract commish.
I am currently using IB and am very pleased with the $4.80/RT commish rate. I used to trade the large ND contract via Lind, but the waiting for a confirm was annoying, so the emini is great!
I am currently using IB and am very pleased with the $4.80/RT commish rate. I used to trade the large ND contract via Lind, but the waiting for a confirm was annoying, so the emini is great!