If you are a trader and a consumer like all of us, the lower commissions only help you to make more money, whether you are presently the record holder money maker amongst day traders or just an average day trader who is trying to make it.
Lower commissions have nothing to do with whether one knows the market or not. It will benefit us all. The cost of doing business on line has decreased significantly since 3 years ago, yet we have not seen the savings passed on to us.
Next, I was not recommending MBTrading as the broker with lower rates. I simply stated that they provide traders with $5 a trade for the first 3 months. That is one step in the right direction, but not what I would like to see as a trader. It is very much like trading, once one lowers the price, we can demand all brokers to lower their prices or business will flow out of that outfit.
If you read some of the books published by day traders who made a name for themselves and a fortune for their families in the 1980s, you will notice that they all emphasize on the fact that one of the keys to keeping your costs down and increase the chance of your success is to keep the commission fees below 2 cents a share.
Lastly, in order to ensure that I dont give anyone an impression that I was advertising for MBTrading, I share the following with you all but make it very clear that I have NO opinion about them one way or the other. Landmark securities offers commission rates as low as 2.5 cents per share.
As you see, if we all demand lower rates from our brokers, we can all benefit--both those of use who make 10k a day or $200 a day.
If you can make a profit with $150 a ticket, you too will benefit from lower cost of commission.
As to the data feed cost, I am in the midst of negotiating with one of the major data providers and will post how much they charge for providing data to brokers or a group of day traders who have got together and trade at the same location. The fee of $250 or so for receiving data is less than the savings you can have in ONE day if you did 10 round trips of 100 shares (20 tickets) and your commission was $5 instead of $20. As you see, the brokers are not doing us a favor by providing free data if you do more than so many trades. We will all be better off if brokers charged for data and lowered the commission rates, even if you only did 20 tickets a MONTH, rather than a DAY.
The bottom line is that We are not getting a free lunch. |
