OT: When is a trade not a trade?
I just received an Email from E*Trade Customer Service stating that after they confirm a transaction they have a 72 hour period in which they can inform you that your order was never filled.
This might work for people who only trade once every three days. What about the Day Trader who might make 6 or 8 transactions a day. What if all of these trades are made using the same money. At the end of the 8 trades he is informed by his broker that the first transaction never occurred. Does this mean that all of the rest of the trades are then not valid?
Assume he sends his broker $10,000 and orders $10,000 worth of a stock. He gets his confirmation and sells this stock and buys another and repeats this several times a day. The next day his broker tells him he never bought the first stock. If he didn't buy it then he couldn't sell it. But then his next transaction was another buy. Since the first order was never filled, he still had $10,000 in his account, so the second buy could have been made if it did not exceed the original $10,000. What if the first stock he ordered, which he never really bought, had doubled in value? He then sold it for $20,000 and bought $20,000 worth of another stock. Actually, since he never bought and sold the first stock, he never had $20,000 in his account. I think you can see how complicated this becomes.
If E*Trade is correct, think how spooky this make |
