I just spoke to a sales guy from OEC and he told me that Collective2 charges traders $3.98 per round trip for gen3 futures trading. WOW! Add to that the commission for the broker and you are close to $8 to $9 round trip for each trade! Now that gets expensive in a hurry and may greatly reduce any profits made via for instance a small swing scalping strategy. Let’s not forget that C2 also charges the strategy’s author 30% of all profits - so both sides get charged.
Can someone confirm please that C2 traders fee of $3.98 per round trip? I want to be sure about that before I move on to greener pastures. If this is true then scalping strategies through C2 are simply unaffordable.
Thanks,
Michael
Is that $3.98 PER CONTRACT per round trip, or just per round trip, regardless of # of contracts?
Click on Auto Trade > How It Works, go to How much does it cost near the bottom - it is all there. And yes, it is per contract.
This is one reason (among others) that I have not seen a scalping system on C2 yet which has stood the test of time.
Thanks Karl!
Yeah well, unfortunately this get rich quick scheme by charging everyone for everything is, in my opinion, seriously affecting this site potential…site that is kind of unique with a very original and good idea behind. Who knows maybe one day we will have competition from another company using the same idea and then fees will drop like they did with brokers.
The C2 Autotrade text (How it works) indicates the fee is charged by the broker "If you choose a Gen3 broker, the broker may charge a small execution fee". If that fee in fact goes to C2 and not the broker, then that needs to be changed IMMEDIATELY …
GG
Let me address some of the questions about AutoTrading fees.
First, for the sake of the many new users here at C2 for the first time, let me stress that AutoTrading is completely optional. No one is forced to use AutoTrade technology. Indeed, many people follow systems at C2 on their own, and then type in their own trades at their own brokers.
Second, there are many flavors of C2-compatible AutoTrading. C2 Members can AutoTrade any system at C2 using whatever technology and software they want. For example, the companies that currently offer commercial Gen1 autotrading software do not charge any per-trade charges. So if this is a concern, you can certainly choose one of these providers. Also, we have an open API, so anyone can write their own AutoTrading software. Many people do this. (We don’t charge any technology license fees – it’s completely free.)
One of the many flavors of AutoTrading technology that is available is called Gen3 AutoTrading. It is not, technically speaking, offered by Collective2 LLC. Rather, Gen3 technology was created by a software technology company (Trade Integration LLC) and is licensed by brokers so that it can be offered to brokers’ customers. (In the interest of full disclosure, while Trade Integration and Collective2 are separate legal entities, with separate ownership, I own at least part of both companies). Brokers pay Trade Integration LLC a fee for using Trade Integration technology and services. Brokers are free to charge whatever they want to their own customers for this service. Indeed, at least one broker (Open E Cry) offers volume discounts to its futures customers. While I wish there was a more robust ecosystem with many more brokers competing to offer their brokerage customers Gen3 technology at lower and lower rates, currently the rates are pretty standardized at $1.99 per futures contract. Perhaps, if C2 does its job properly, and encourages widespread adoption of C2 AutoTrade technology, that will change, to the benefit of C2 members.
Some people feel that the current cost of Gen3 Autotrading ($1.99 per contract) is too high. Of course each individual who is considering using Gen3 AutoTrading technology needs to weigh the costs versus the benefits of using the technology. (Or using Gen1 technology, or using no technology…) For some people, the convenience of not needing to run any software on their computers, and of allowing everything to run auto-magically “in the sky” – which is what Gen3 is all about – is appealing. As for why there’s any cost at all… well, the reality is that providing this service in today’s technical, legal, and regulatory environment is costly. I wish it could be otherwise, believe me.
Finally, regarding Gregg’s implication that there is somehow inadequate disclosure about costs and fees: I think the costs of Gen3 AutoTrading are fairly disclosed. The corporate relationships between Collective2 LLC and Trade Integration LLC – while they make for some mind-numbing legalistic reading – are also disclosed during AutoTrade setup, etc. The main points, which are noted in all the various disclosure docs is: that your broker will charge you a fee for Gen3, that the broker is offering software created by Trade Integration LLC, and that Trade Integration is compensated by the broker.
Our goal at Collective2 is to offer the most amazing trading-system platform available anywhere. We spend a lot of time, heartache, and resources to do so. We have a lot of exciting announcements about new brokers coming up soon, so hang on.
Matthew
Matthew, talking strictly from a (otherwise a valid and very profitable) scalping strategy point of view where auto trading AND gen3 is absolutely required Collective2 charges way to much, simply making it not worth for subscribers and here I did not took in to consideration the inevitable slippage which combined with high charge from collective2 and broker fee will definitely make any scalping strategy a losing one.
Scalping IS part of the trading game AND CAN BE a very, very profitable way to play the market, gen3 is required the most exactly for that but ironically can not be used. For someone that is not scalping gen2 or first version of autotrading is OK, orders can be placed manually because theoretically there is enough time for that but for scalping, gen3 is like I said absolutely required.
Collective2 is a great idea and a great website, don’t get me wrong, I do appreciate your efforts and I definitely think that you should be recompensed for this idea and this company but still, there are some issues you still have to think at.
PS:
One day I will try to see if what I do (scalping) can be done trough collective2 for subscribers however I have serious doubts about it…
Paul -
C2 is a place primarily for retail traders. My experience is that your typical retail trader should not be attempting any scalping strategy (not just C2 systems, but any system at any retail broker). Just too many delays involved.
On another note, why are so many people ignoring you (34%)? Did you change your name?
Kevin
Paul, have you used the C2 software to personalize the results of many systems? With that you simply add the appropriate costs in the commission section. You can also add a few cents per share slippage, and the additional gen 3 $3,90 fee per in the stocks and futures section by adding it to the commissions. The difference you will see will amaze you…
If you have any comments or questions I can be contacted privately at babsontrading@gmail.com
Ron
Kevin, I got that nice 34% ignored after the discussion about brokers where my opinion was that the broker does not matter if one can really win this game. Never changed any name.
Oh, and…Kevin, I suppose your experience is not very large if you think in that terms about scalping and retail traders. Of course there is also the issue with what do you understand by scalping.
Cheers,
Paul
Hi Paul -
I’m surprised I missed the broker conversation. I agree with you, if you are saying brokers know most clients are going to lose money, and so they try to milk the clients for the most $ possible.
My experience is that most retail traders are ill equipped to scalp (be it hardware, software, cost, quant/algo skills or emotions). I base this on knowing people who successfully scalp, and numerous retail traders. In my view, these groups have little overlap. But, many exchange members with co-located computer equipment are successful scalpers.
Of course, maybe in the past 20 years I have just met all the wrong people!
If you have different story, I’d love to hear it.
Kevin
By scalping, I mean a strategy where most of the trades have profits equal to the bid/ask spread. So, with mini S&P (ES), a scalping strategy would have most trades at .25 point, or $12.50 per contract. This trading was historically the role of the pit floor traders.
Since for retail (non-exchange member) traders the RT commission & exchange fees are usually $5 minimum, this means 40% of a profitable trade goes to comissions and fees.
As one goes for more ticks, the costs goes down, and becomes less of a scalping strategy. Some people refer to 1 point in the ES as a scalping strategy. I agree this could be done by retail traders.
Kevin you are definitely right, but with scalping I was talking about a few ticks (between 4-12) not the bid/ask spread…obviously! Call it retail traders scalping then…whatever.
Paul -
OK, then we do agree.
Unfortunately, I do know people who try to scalp the bid/ask spread (or maybe 2 ticks). Their simulation/backtesting engine shows them it c be profitable. Then they go to real money, and fail miserably.
Thanks for clarifying.
Kevin
