Real Time Trades = Real Time Profit
Thanks to the internet, investing in stocks with the click of a button has become a breeze. However, many novice investors are losing money with one of the simple things a new investor should know – not trading real time. Real time trades can equal real time profit, but the question is for whom?
When a new investor starts trading online, one of the big things they’ll typically take into consideration are the fees of a potential trading site. Many sites lure in new investors with a blanket charge for a blanket buy or sell.
This blanket charge is significantly less than the price of trading in real time and for a new investor it seems like a more profitable option than paying a large fee to trade.
This may seem like a more profitable option, as nobody wants to pay a lot of cash for something you are just learning. However, for investors purchasing a large quantity of a certain stock in a blanket trade, keep this in mind - these blanket fees give the online companies the option to make money at your expense.
Here’s how it works: a real time trade is exactly what it sounds like, a trade that happens in real time. With a real time trade, you type in exactly how much you are willing to pay for a stock and exactly how many shares you want. This means that the moment the stock becomes available at that rate and for that price the company will purchase it for you.
When you participate in a blanket trade, you are still saying the same thing. You are requesting a certain number of shares be purchased for you at a certain rate. The difference is, when you do a blanket trade, the online company has the option to profit at your expense.
You told the company to purchase a certain amount of stock for you at a certain price. Well, they will do that. However, if that stock dips, they may purchase that stock for much less than you requested, but you’re still billed for the price you said you’d pay. The company pockets the difference in the amount and that’s how they make their money on a blanket trade.
This practice is totally fine and totally legal, but it’s a fact a novice investor often overlooks. After all, if you are purchasing a large quantity of stock, isn’t it much better to ensure you’re only paying exactly what you said you’d pay? Some would argue that a few pennies here and there don’t matter, especially if it results in a guaranteed larger fee.
This is true. However, when purchasing a large quantity of stock, just make certain to do the math and determine which trade is guaranteed to serve your pocketbook. After all, that’s the name of the game.
When a new investor starts trading online, one of the big things they’ll typically take into consideration are the fees of a potential trading site. Many sites lure in new investors with a blanket charge for a blanket buy or sell.
This blanket charge is significantly less than the price of trading in real time and for a new investor it seems like a more profitable option than paying a large fee to trade.
This may seem like a more profitable option, as nobody wants to pay a lot of cash for something you are just learning. However, for investors purchasing a large quantity of a certain stock in a blanket trade, keep this in mind - these blanket fees give the online companies the option to make money at your expense.
Here’s how it works: a real time trade is exactly what it sounds like, a trade that happens in real time. With a real time trade, you type in exactly how much you are willing to pay for a stock and exactly how many shares you want. This means that the moment the stock becomes available at that rate and for that price the company will purchase it for you.
When you participate in a blanket trade, you are still saying the same thing. You are requesting a certain number of shares be purchased for you at a certain rate. The difference is, when you do a blanket trade, the online company has the option to profit at your expense.
You told the company to purchase a certain amount of stock for you at a certain price. Well, they will do that. However, if that stock dips, they may purchase that stock for much less than you requested, but you’re still billed for the price you said you’d pay. The company pockets the difference in the amount and that’s how they make their money on a blanket trade.
This practice is totally fine and totally legal, but it’s a fact a novice investor often overlooks. After all, if you are purchasing a large quantity of stock, isn’t it much better to ensure you’re only paying exactly what you said you’d pay? Some would argue that a few pennies here and there don’t matter, especially if it results in a guaranteed larger fee.
This is true. However, when purchasing a large quantity of stock, just make certain to do the math and determine which trade is guaranteed to serve your pocketbook. After all, that’s the name of the game.