
JPMorgan unveils free trading - pmart123
https://www.cnbc.com/2018/08/21/jp-morgan-to-unveil-new-investing-app-with-an-eye-catching-disruptive-price-free.html
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TheAlchemist
There is no such thing as 'free trading'.

As the saying goes - "if it's free, you are the product". Especially in
trading.

If the broker / bank is getting charged by the exchange for executing your
orders (aggressive orders in the US), then one way or another it will be
charged on you (+broker's cut).

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bananabiscuit
Someone I know who works at a hedge fund told me it was not a secret that
retail order flow (trade requests from “ordinary people” on scottrade and
etrade) was so misguided that, if it was allowed by the SEC, you could end up
positive just by betting against it by taking the opposite position.

Maybe JPmorgan has some way of doing just that without breaking regulations.

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dubhrosa
The hedge funds don't bet against it, they actually pay the large retail
brokers for this order flow, ie they execute it for them, because it is non-
alpha-bearing, ie generally clueless, it gives them opportunities to cross
their own trading flow (ie if they are selling and retail is buying, thereby
getting a trade they were going to do anyway done for no cost at the current
mid-price in the market) with the rest they can aggregate it with their own
flow, and since it's not alpha-bearing, they use it as inventory in their
market making algos, ie they execute it passively, always on the near side of
the spread, and also pick up the rebate from the exchange for being a
liquidity provider.

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crb002
If you have a large enough book it works. The big boys pay fees and the little
guys get aggregated. All depends on what a "market order" is.

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nickthemagicman
How does Robin Hood provide free trading?

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pmart123
I haven't read anything recently, but typically, the idea is you can make
money through:

1\. Interest from lending securities to hedge funds to short them

2\. Margin maintenance fees

3\. Selling order flow to trading firms

4\. Other services

