“Free Trades won’t make you a better investor” according to Fidelity Investments. If that’s the case, then why does Fidelity offer commission free trading, (with conditions) as an incentive to entice new accounts? Most large brokerage firms offer similar free trading programs to new investors, so Fidelity is not alone in this. The reason is simple. Reducing costs can improve the bottom line.
As stated many times in previous blogs, having an “EDGE” can make a big difference in the results you achieve. Or as I like to say “All I want is an unfair advantage”! The ability to trade for free provides investors an “edge” and I completely disagree with the opening statement and here is why:
- New investors tend to dip their toe in the water by starting with a small amount of money. Whether they do so out of fear or because it’s what they are comfortable with does not matter. However the smaller the account size, the more important the cost of trading becomes.
- When investors focus on trade costs, they tend to not sell when they should, and that can be a very expensive mind set. As a result, investors engage in the “hold & hope” death trap.
Over the last couple months the markets have become more “volatile” for a variety of reasons. When volatility sets in, investors are unnerved and often make mistakes simply because they don’t have a strategy, a discipline, or rules in place that they follow. Mistakes are inevitable when investing. The answer to mistakes is to write them down, and read your notes often so you don’t repeat your mistakes.
Before I continue, a few words on volatility. First the definition: it’s a statistical measure of the tendency of a market (or a security, fund, etc.), to rise and fall sharply in a short period of time. WHY this happens is not important in the context of today’s blog. Second: all the various instruments that make up the market have different levels of volatility and it depends on what’s considered a “normal trading range or pattern”. Third: Ignore all the experts who will tell you to “ignore” volatility —“it’s just part of investing” — this is a “long term” commitment — and the list continues. Do what makes you sleep at night and most of all do NOT IGNORE SELL SIGNALS!!!!
And now here is your EDGE — ROBINHOOD.com — you can trade for FREE with ROBINHOOD via your iPhone or iPad.
They have a mission to give EVERYONE access to the financial markets by offering free trading on U.S. listed securities. It’s the “NO more excuses” to all who let costs stop them from investing.
If you are thinking “Oh sure, what’s the catch? No one can operate without making money.” On their web site they explain how they make money and I encourage you to read it. One example is they charge for trading on margin. That said, BuySelliQ investors now have the perfect complement to trading stocks, ETFs, & Mutual funds.
February is almost over and Cupid hit the mark with RobinHood.com and BuySelliQ with $0 commission trading platform and our unmatched market trend signals. BuySelliQ provides the timing, the quality score, the performance history, and most importantly, we give you the ability to get in on positive trend changes and out, when the trend turns negative. Protection of capital is critical as part of your overall strategy. As I was told long ago, without inventory (available cash), you can’t take advantage of new opportunities.
Make volatility your friend by taking the signals from BuySelliQ, and trading at ROBINHOOD.com for $0 cost.
No more excuses! Trust the Dot™!