Home > Boards > Free Zone > Education > Investor Help (NO Ihub questions)

There are other risks from free trading---namely, that

Public Reply | Private Reply | Keep | Last ReadPost New MsgReplies (1) | Next 10 | Previous | Next
cintrix Member Profile
Member Level 
Followed By 319
Posts 111,084
Boards Moderated 5
Alias Born 12/28/00
160x600 placeholder
cintrix Member Level  Thursday, 10/03/19 10:25:03 AM
Re: Wildbilly post# 5446
Post # of 5512 
There are other risks from free trading---namely, that brokerages may recoup the costs in less transparent ways. The first is by widening the bid/ask spread. You may have noticed that when you trade a stock in your account you almost instantly lose money compared to the market price. This is because of bid/ask spreads; to compensate the market maker for constructing a market in a stock, you typically don’t receive the market price when you buy or sell. You pay a little bit more than the prevailing price when you buy and receive a little less when you sell. Of course, a brokerage may provide an unattractive spread for you regardless of fees, but the absence of trading commissions means that less efficient trading could be a way for brokerages to capture revenue from trades in a way that’s less obvious to the customer, such as routing trades in a way that leads to wider spreads.
https://www.forbes.com/sites/simonmoore/2019/10/01/the-hidden-costs-of-commission-free-trading/#5600a22e62b7

Public Reply | Private Reply | Keep | Last ReadPost New MsgReplies (1) | Next 10 | Previous | Next
Follow Board Follow Board Keyboard Shortcuts Report TOS Violation
X
Current Price
Change
Volume
Detailed Quote - Discussion Board
Intraday Chart
+/- to Watchlist