How To Lose

[scose-no-doubt]

liquidity provision rebates

 

[ChocolateDigestive]

I shall add: Consistent loser strategy that can be reversed.

Broker's bread and butter can't be reversed

can be but difficult. need to trade through a prop with $3 commission per 1000 shares and use an appropriate ECN to get paid for adding liquidity with limit order on the bid/ask. this was commonplace until recently on citigroup (C) so much so that they did a reverse stock split to try and kerb it.

News Headlines

 

[Ross Spur]

transaction cost that is.

you will have to pay it; whether you reverse the strategy or not

Not with my guaranteed no loss, no trade strat.*



* CBA Trading System, only $1000 per month.

 

[tar]

transaction cost that is.

you will have to pay it; whether you reverse the strategy or not

If you trade futures you definitely have the right to place your limits at the bid or the ask , and in many futures markets the commission you have to pay is just a fraction of the bid-ask spread that you are trying to earn ...

 

[alphadude]

liquidity provision rebates

Two issues with that:
- that depends on the market you trade. in FX; you won't get it.
- even where you get it (i.e. US equities); if you trade passively (providing liquidity); execution is not guaranteed when you need it most. It's a type 2 error. you end up missing few trades; and hence you have not reversed your losing strategy in full.

 

[ChocolateDigestive]

can be but difficult. need to trade through a prop with $3 commission per 1000 shares and use an appropriate ECN to get paid for adding liquidity with limit order on the bid/ask. this was commonplace until recently on citigroup (C) so much so that they did a reverse stock split to try and kerb it.

News Headlines

look here is the BATS schedule.

http://batstrading.com/FeeSchedule/

you can capture $0.0029 per filled limit order plus you get the spread of $0.01 so that is +$0.0158 per share traded. Your commish would be 2 x $0.003 per share traded so you make $0.0158-$0.006 = $0.0098 per tarde. you do volume so say you trade in lots of 1000 shares. = $9.80 profit per fill across the spread.

there are ECN's that pay you higher.

it's a nasty job but if you want to grind out a income doing this it is feasible.

if you are doing it on a $50 stock then you need $50,000 capital, prop firms will gear up 20:1 so you will need $2500 margin, some props will prob gear you higher if you can show them some blotters.

this is the beauty of trading prop. I pay $0.005 with a prop firm which is the same as IB however I get full ECN pass through so I can get nice rebates plus 20:1 leverage not pants 4:1

 

[ChocolateDigestive]

If you trade futures you definitely have the right to place your limits at the bid or the ask , and in many futures markets the commission you have to pay is just a fraction of the bid-ask spread that you are trying to earn ...

sure isnt that what Arabian was up to with his STIRs tick whoring?

 

[The Leopard]

liquidity provision rebates

Who needs those when you can get some trading know-how slapped into you by the great Losebooby?

Yours for only £10,000 and an overnight stay in hospital.

 

[ChocolateDigestive]

Two issues with that:
- that depends on the market you trade. in FX; you won't get it.
- even where you get it (i.e. US equities); if you trade passively (providing liquidity); execution is not guaranteed when you need it most. It's a type 2 error. you end up missing few trades; and hence you have not reversed your losing strategy in full.

i believe most tarders would wait for the 1st fill and scratch with a market order if market went against them either that or strap yourself in for the ride. lol.

 

[tar]

sure isnt that what Arabian was up to with his STIRs tick whoring?

that is what many locals do at the pit and prop shops ...

 

[alphadude]

i believe most tarders would wait for the 1st fill and scratch with a market order if market went against them either that or strap yourself in for the ride. lol.

lol: at the end of the day it boils down to the mechanics of your strategy.

Execution algos are quite useful in this area; but your order must be huge so it can get diced up.

 

[Splitlink]

I have a feeling a lot of people lose money just because they don't realise the cost of trading regardless what system they use.

The thing I noticed early on was that a loss would always be the full 2% or whatever I risked but a win would reach say an equal 2% profit then pullback to say 1% profit and I'd take the 1% because I didn't want to lose the profit. I'd need 2 winners for every loser just to breakeven.

I don't see that. My trading platform gives me the level at which I bought and, also gives me the PL. It is simple to put the stop at breakeven, if I want, and it would include the spread, when triggered.

Anyway, it is a minor point. I agree that many new traders do not take into account the spread. In fact, the trade must register a loss as soon as the it is opened.

 

[ChocolateDigestive]

the 3rd most traded stock on the nasdaq yesterday was SIRI (sirius XM radio), 48.9m shares traded. now I wonder why all those people were trading such a small stock lol.

 

[ChocolateDigestive]

i got the maths wrong rampton - edited the last example on a $50 stock it's actually fkin easy to make money.

lets take the example of SIRI which currently tardes at $2.14. Lets say we are going to tarde this in 1000 share blocks. to keep things simple we have negotiated $0.003 per tarde commission and we get $0.003 rebate from our ECN, so basically if we get filled we capture the spread of $0.01 and the rebate and commission cancel each other out. so we make 1000 x $0.001 = $10 every time we get filled. at 20:1 BP only have to put up $107 in margin (= 1000 x $2.14 / 1000). got me thinking now if you could clip 10,000 at a time that would be $100 per fill. do that 10 times a day and you earn $1000 per day. of course we pay a 5% profit split to the shop but that is still nice. I might have some of it. lol.

 

[scose-no-doubt]

Too easy. Overlooking something.

And your maths is poo by the way.

 

[ChocolateDigestive]

check out yesterday's price action. got a bit flat in the afternoon lol. I just cant think what they were up to.

 

[The Leopard]

And your maths is poo by the way.

I thought the same. 100 clams 10 times a day? That ain't 10,000 sheets, that's 1,000 green.

 

[wackypete2]

I thought the same. 100 clams 10 times a day? That ain't 10,000 sheets, that's 1,000 green.

geez..I was ready to sign up for whatever he was selling!!

Peter

 

[scose-no-doubt]

Only a thousand a day? 50-100 pisp a day at £20 sounds better. Tax free too.

 

[The Leopard]

geez..I was ready to sign up for whatever he was selling!!

Peter

You don't want to go with him, he's a looser.

You need to get some training from Losebooby, that's the way to 300% per trade.

You'll need a big wadge of this:

And one of these:

You can check him out in his Livebooby webinar tomorrow. That's right! Watch the world's foremost expert on price behaviour call out retrospective trades - 100% live!

Live retrospective trading - the hallmark of the champion!