How do I gauge how many shares of a stock I can purchase or sell without effecting it’s price?
For example, say we have a security with price $20 & avg daily vol of 1m share. That’s $20m a day infused into the stock divided by 390 (the # of minutes in a trading day) that’s about $51,200 a minute that changes hand in that stock. If I see a trading opportunity and want to buy $100,000 worth of stock that minute how will that affect the price? Is there a factor like 2X, 3X, 4X, etc that I can use to know how much more (or less) than the normal 1 minute dollar flow I can successfully trade. Also, I use limit orders so I can’t just put in a market order and accumulate shares over a few minutes until I’m filled. This is a day trading strategy so price is very important to me and often times I need to get filled that minute.
Thanks for the help!
I hope it’s a hypothetical question because if you were to implement the strategy you are likely to be fleeced.
You don’t have enough information. Every stock is traded by a handful of specialists / MMs who have a good feel for it and can easily spot an abnormal activity, an outsider, and outsmart them.
If you want to trade against them you have to do the same – watch the stock until you get a feel for it. There are too many games you have to be aware of to list them all here. Having Level II and knowing who the players are is a first step. How your bid size (5,000 shares) compares to the current ask is a second. Suppose there are 10,000 shares at the ask. You shouldn’t have a problem. But what if there is only 1,000? What if there is a seller who is not showing his hand? Or a shrewd trader spots you, jacks up the price on your order, sells you 5,000 shares by going short on the spike, drops the price back and covers? And so on…
Trading on Margin and unsettled funds…?
I had a question about margin trading with regards to unsettled funds. Here is my (hypothetical) situation:
I have a margin account with $25,000.00 cash in it. I have 4x margin buying power, but I use only cash on Monday to trade $25,000.00 cash. Since it takes 3 days for the cash to settle on the sale of equities, would I have to wait until Thursday to resume trading, since the initial margin requirement is 50%? Or could I trade on Tuesday and Wednesday using just margin, and not my own cash? I am kind of confused on this, so any help is appreciated. Thanks.
If you have a margin account you do not have to wait for the settlement date. Margin accounts allow you to continue using just your cash available from selling. Without a margin account you would need to wait until a sale is settled in order to use that cash for any transaction. Even if you never use the brokerage (margin) cash you may buy and sell instantly with proceeds from a sale.
What do you know about “4X CURRENCY” ?
I SAW THIS COMMERCIAL ONLINE ON HOW TO successfully trade currencies WITH THIS PROGRAM CALLED 4X CURRENCY. IM CURRENTLY IN A FINANCIAL JAM AND I ONLY HAVE $1000 TO MY NAME. IM THINKIN ON INVESTING IN THIS PROGRAM BECAUSE IT LOOKS LEGIT BUT I THOUGHT I SHOULD ASK FOR PEOPLES OPINIONS 1ST. IF ANYBODY HAS ANY INFO THAT MIGHT HELP OUT IT WOULD BE HIGHLY APPRECIATED.
If you have only $1000, why would you engage in speculative behavior which upfront tells you that there is a chance to lose all that you own. This is gambling with a bit of class.
Can I use two different share trading websites?
I am an occasional buyer and seller of UK Shares. I use E-trade and choose to hold the purchased stock in a nominee account (i.e. I do not receive share certificates) – I think this is the norm these days!
However iii.co.uk have a service whereby if you are investing for the long term, you can buy and sell stock for £1.50 commission (you are limited to just 4x days a month when you can trade).
My question is – Can I trade stock through two separate brokers and hold stock in two separate nominee accounts? Is it legal?
1 or 2 or 10. It does not matter at all. You may have as many brokerage accounts as you wish. At one time I had 4. I am now down to 2 but and considering a 3rd. There are some advantages to having multiple brokerage accounts. The different accounts might have different research offerings and also provide different services.
4x made easy/wisetrade – anybody bought it?
Wisetrade and 4x made easy -computer progarms to trade stocks and currency , have you bought one of these and made any money – any negative comments ?
I tell you this, you won’t make money in the market using a program, you have to use your brain. If it were the easy, then everyone would use these programs.
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