Commission Structure/Order Types
Original Q/A and discussion: http://community.tradeking.com/forum/topics/689/forum_posts
Q: Hello, could someone tell me how many times you pay a commission on a single trade? I recently prepaired my first ever oto order only to see two $4.95 commissions, one for the buy/stop/limit side and one for the sell/stop side for a total $9.90 commision on 1 trade. Is this normal or specific to conditional orders? Also is this how all brokerages do it? Always thought $4.95 meant buy stock, hold into profit, then sell, one price. How does it work? Thanks in advance.
Q: Since we're discussing commissions, I've been wondering something myself. If I were to use all my available funds on a trade (leaving my account balance under $4.95) - When I go to sell the stock/option will TK deduct the commission from the proceeds of the trade or does the commission need to be available in the account when you are making the sale?
Q: Here's something I don't understand (my first order with TK) : I'm doing a "one triggers the other" Option order >> buy 1 option to open, $5.60, then sell 1 option to close, $5.60 (total=11.20) . So, why does the est order total = $21.21 ? (I'm trying to buy an option with a limit order, then sell with a STOP it if it goes in the wrong direction).
A: First off let me say thanks to everyone for all the great answers that have been given in this thread. That is what this community is all about; people helping other people become more savvy and educated investors. I want to clarify a few things that have been discussed in this thread to make sure everyone is clear on how our commissions operate.
1. Partial Fills - We charge one commission for any partial fills that execute over the course of the same day. If you change your order or the order takes multiple days to execute, you will be charged a new commission for each day a partial order executes or for each changed/new order you create.
2. OTO Commissions - Because an OTO order consists of two orders, you will be charged two commissions. Please remember though that you are only charged a commission once an order has executed. We will never charge you a commission for an order that never executes.
3. Estimated Order Total - RetireOnTime explained this just as I would have. The Est. Order Total is either the net credit or debit, including all fees and commissions, that occurs in your account when your order(s) execute.
Hope this adds a little clarity to all the questions in this thread. Give us a buzz at 877-495-5464 if anyone has any account specific questions. Thanks everyone!
Q: Regarding what Chris said about partial fills:
Assume I am putting an order in for multiple contracts, on a lower volume option (like not in the hundreds/thousands), and not at the ask price - should I always place these orders AON to avoid partial fills over multiple days?
Also, if I were to roll the dice and not put it in as AON and only got a partial fill - Would the order automatically still be in effect the next day (even if it wasn't GTC) because it was only partially filled?
Just looking for elaboration on partial fills regarding multiple days and the best way to avoid multiple commissions if anyone can help on that. Thank you.
A: AON is an alternative to avoid split and partial fills, however that does also make it harder for the order to be executed. This is particularly problematic when dealing with an options without much liquidity. If you place a day order which is partially filled, the unfilled portion of the order would expire at the close of business on the day it was placed. The decision to weigh when considering whether or not to use AON, is the possibility of not being filled at all worth the cost of the possible extra commission you may incur if you do not qualify the order as AON.
