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Strategies & Market Trends : The Final Frontier - Online Remote Trading -- Ignore unavailable to you. Want to Upgrade?

To: TFF who wrote (7688)	9/21/1999 10:40:00 AM
From: Eric P	Read Replies (1) \| Respond to of 12617

Interesting offering. A recent post on the AB Watley thread posted the e-mail that Watley sent to their existing customers regarding this change. One portion of this e-mail was as follows: There is no money market sweep feature for this new service level. For example, at the end of each day and as an average throughout the month there must be a $20,000 free cash balance in your account. UltimateTrader FREE accounts are not eligible for a money market sweep unless the cash balance exceeds $100,000.00. Funds over $100,000 will be swept into the Alliance Capital Reserve Fund. UltimateTrader FREE accounts will receive a fixed interest payment on free cash balances of 1.5 percent. If I understand correctly, it sounds like this UltimateTrader Free account is targeted to the low volume customer who wants the software 'free'. The tradeoff is the lower interest rates paid on cash balances in the account. For a customer with the minimum $20k cash balance and very few trades, the ~2.5% interest rate reduction (1.5% versus ~4.0%) will 'cost' the trader approximately $40/mo. For a trader with higher account balances of $100k, the lower interest rate will 'cost' about $210/month in reduced interest. Not exactly 'free', but still perhaps attractive for some people with relatively small accounts (i.e. less interest lost) and few trades (software not already 'free'). -Eric

To: TFF who wrote (7688)	9/21/1999 2:40:00 PM
From: Dan Clark	Read Replies (1) \| Respond to of 12617

There is one "catch" in this - cost of the trade. Each ticket varies from $19 to $24 based on volume. Here is a comparison between ABWatley UltimateTrader Free and CyberX+QCharts (my choice). # Trades CyberX + Qcharts ABWatley Low High Fixed Comm. Total Fixed Comm. Total 1 9 $140 $15 $155 $0 $24 $24 10 24 $140 $15 $290 $0 $23 $230 25 49 $140 $15 $515 $0 $21 $524 50 99 $140 $15 $890 $0 $20 $998 100 199 $140 $15 $1,640 $0 $19 $1,895 The breakeven comes at about 25 tickets per month or about 1 round trip trade (two tickets) every two days. Not much for a modestly active trade, but probably adequate for the beginner. Note that my breakeven analysis does NOT take into account the additional monies lost by not having the money in a money market sweep with ABWatley Ultimate Trader Free. Regarding the charting and Order entry. IMO, QCharts provides better data and charting than ABWatley. CyberX order entry is very easy-to-use, flexible and smooth. ABWatley's order entry is probably somewhat more flexible at the cost of some ease-of-use. For true scalpers (average 10-60 second trades), ABWatley's integrated (with Level II) order entry probably is worthwhile. For short-term and longer position traders (average 60+ second trades) trades), integrated order entry may be a toss up. Disregarding the specific numbers, one thing that I don't like about any scaled commission structure (regardless of vendor) is that I'm afraid that I will overtrade. I.e., execute extra trades to try for the next lower commission level. Watley's new product and the CyberX/QCharts, IMO, are a preview of more aggressive marketing by many brokers. The next twelve months should be interesting. Regards, Dan