Commissions and slippage might ruin your trading strategies. The market offered a nice opportunity to show how bigger bid-ask spreads eat into your profits. This article covers the newly implemented 5 cents spread in certain stocks and how that has influenced my trading profits negatively. Why bid-ask spreads increased On October 3 in 2016 SEC…
Lately, I have done some research trying to develop some new daytrading strategies. I have tested many trading strategies that buy or sell at the open (OPG). The exit has been after two hours or on the close (MOC). An OPG trading strategy limits slippage. Likewise, a MOC trading strategy does the same. In this…
Trading is very difficult. Not only is it difficult to find profitable strategies, but you also have to overcome slippage and commission costs. Slippage is difficult to estimate. Commissions costs, however, are easy to calculate. Personally, I pay .001 per share in clearing plus ECN rebates and taxes/fees. So far in 2012, I have paid…
What is slippage in trading? Slippage is a hidden cost that is difficult to quantify. It’s the difference between a theoretical price and the price you get in real and live trading. What is slippage in trading? Slippage is the difference between fictional results when testing strategies, and the actual results in real life adjusting…
