Jul 07

New Institutions for Online Trading

Online Trading Comments Off on New Institutions for Online Trading

New Institutions for Online Trading The current online trading industry is in upheaval. This is in large part due to the down turn in stock prices and its gradual clawing back at the whim of the global economic crisis. People are looking for a change and don’t want to pay exuberant brokerage fees to trade online. That is where the new wave of online brokers comes into the fold. Many of the new brokerage institutions that specialise in online trading have disposed of the outdated methods that were employed by brokers in the past. Many have turned to a flat fee based on the amount you intend trading. New brokers are also offering a relatively new trend in the industry known as Straight Through Processing (STP).

This negates the need of slow manual processing methodology. It ensures that your trade goes straight through to the market and ensures you get the best price for the stocks you want. Manual processing was often slow and by the time the broker had collated all of the orders for a specific stock – the stock had lost (good for the buyer) or gained points (bad for the buyer). This can also be a curse in that because of the speed of the transaction you will have no time to actually change your order to best suit your requirements. STP puts a little more power into the hands of the buyer rather than the broker. However, it is important that you do not make any mistakes in the order.

Don’t be afraid to utilise the services of a new brokerage institution. You can save yourself thousands of dollars in fees over the course of your share trading career. Because online trading is a relatively new method of conducting share trades; it may be in your best interest to use a new service that is competitive and innovative.

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