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Investing - General (not P2P) / Re: Anyone Use FOLIO Investing for Stock Investing?
« on: December 01, 2013, 09:03:32 PM »I see that these 'window trades' get matched at exactly the spread midpoint, it says. Do you not have any control over this, like a limit price on the window trade?
I am curious about this, too. I would be very uncomfortable about being forced to purchase only during their trading window, especially if you can't limit the purchase price. It opens up the very-real possibility that someone is front-running their trades. At minimum, it allows them to make an off-market deal with a market maker of their choosing, to place a market order straight into the bid/ask (assuming it's even the best price among the exchanges) in return for some form of kickback.
You are most likely paying much higher than $29/month for these trades.
While your conspiracy is an interesting one, I would I highly doubt its true, seeing the close regulation of the SEC on all stock holders/employees of the company.
There can be multiple exchanges that a stock trades on; not just the NASDAQ or NYSE. This is especially true for options. Who is to say they don't have a deal with a specific market maker at one of the smaller, less-liquid exchanges (where the bid/ask spread is 3-4 times larger)? It's a 100% legal way to rip clients off and it happens all the time.
Don't doubt the amount of unethical behavior that exists on Wall Street. Heck, since the beginning of time, virtually every brokerage firm has been lending shares in their client's accounts to traders and hedge funds to sell short, while keeping the interest for themselves (instead of paying it back to the client). And don't even get me started on the IPO process...
It's much more likely to happen with options. I will say you are NOT allowed to choose exchange explicitly like you are in something like TradeStation. Then again, choosing your exchange though isn't necessarily common practice for internet brokerages either. Not too many stocks are traded this way anymore and while it is possible its not all THAT common. ADR's and smaller companies sometimes still do this like .TO exchange companies and foreign based like stuff based in the carribean and netherlands. I'm not saying it doesn't happen, I'm saying it is the minority of companies and Folio is kinda geared towards making your own "ETF" strategy further diversifying you and making any possibility of a cross listed holding be an even smaller % of your holding.