Multiple commissions on partially filed ETF orders

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tc101
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Multiple commissions on partially filed ETF orders

Post by tc101 » Wed May 26, 2010 3:31 pm

Today I put in a limit order on a non vanguard ETF, good for 60 days. It was partially filled. I only got 9 shares, and a $2 commission. I just called Vanguard and learned that if it is filled or partially filled again tomorrow, I will get another $2 commission.

It is very unlikely, but in theory, if I leave the order open and only get a few shares a day every day for the next 60 days, I could pay a total of $120 in commissions on this one trade.

Something to think about with thinly traded ETFs.
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tfb
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Re: Multiple commissions on partially filed ETF orders

Post by tfb » Wed May 26, 2010 3:44 pm

tc101 wrote:Today I put in a limit order on a non vanguard ETF, good for 60 days. It was partially filled. I only got 9 shares, and a $2 commission. I just called Vanguard and learned that if it is filled or partially filled again tomorrow, I will get another $2 commission.

It is very unlikely, but in theory, if I leave the order open and only get a few shares a day every day for the next 60 days, I could pay a total of $120 in commissions on this one trade.

Something to think about with thinly traded ETFs.
Not sure about VBS, but at other brokers, you can specify 'all or none' as a condition of your order. Getting a partial fill means you are getting the lowest price of the day. Paying $2 is worth it IMO.
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Re: Multiple commissions on partially filed ETF orders

Post by Ed 2 » Wed May 26, 2010 3:45 pm

tc101 wrote:Today I put in a limit order on a non vanguard ETF, good for 60 days. It was partially filled. I only got 9 shares, and a $2 commission. I just called Vanguard and learned that if it is filled or partially filled again tomorrow, I will get another $2 commission.

It is very unlikely, but in theory, if I leave the order open and only get a few shares a day every day for the next 60 days, I could pay a total of $120 in commissions on this one trade.

Something to think about with thinly traded ETFs.
That`s why I will never convert my Index Funds to ETF`s , seams to me they will always create some kind of " shipping and handling fee" to make up loss on free trade of ETF`s. How else they going to make money from retail investor?

Nothing is free in this world. :annoyed
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Doc
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Post by Doc » Wed May 26, 2010 3:47 pm

I think that all trades made to fill a single order on one day get only one commission but if that order is filled over several days you get a commission for each day.
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Post by livesoft » Wed May 26, 2010 3:52 pm

At the brokers that I have used, I only use Good-for-day orders. I get partials fills routinely, but they count as a single trade for no commission since they are part of the same-day same order.

However, if I get a partial fill, then change the remainder of the order, then that's a new order.

There is no way I would put in a good-for-60-days order. I guess you were trying to grab some shares like on May 6th without paying any attention?

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Re: Multiple commissions on partially filed ETF orders

Post by HueyLD » Wed May 26, 2010 4:07 pm

tc101 wrote:Today I put in a limit order on a non vanguard ETF, good for 60 days. It was partially filled. I only got 9 shares, and a $2 commission. I just called Vanguard and learned that if it is filled or partially filled again tomorrow, I will get another $2 commission.

It is very unlikely, but in theory, if I leave the order open and only get a few shares a day every day for the next 60 days, I could pay a total of $120 in commissions on this one trade.

Something to think about with thinly traded ETFs.
Hi tc101,

Next time, you might want to stay away from thinly traded ETFs because liquidity could be a big problem and you have only experienced the easier side-the buy side. In addition, use only GFD (good for the day) limit orders because trading ETFs across the dateline can be very dangerous to your financial health.

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Re: Multiple commissions on partially filed ETF orders

Post by Carpe » Wed May 26, 2010 4:07 pm

tfb wrote:
tc101 wrote:Today I put in a limit order on a non vanguard ETF, good for 60 days. It was partially filled. I only got 9 shares, and a $2 commission. I just called Vanguard and learned that if it is filled or partially filled again tomorrow, I will get another $2 commission.

It is very unlikely, but in theory, if I leave the order open and only get a few shares a day every day for the next 60 days, I could pay a total of $120 in commissions on this one trade.

Something to think about with thinly traded ETFs.
Not sure about VBS, but at other brokers, you can specify 'all or none' as a condition of your order. Getting a partial fill means you are getting the lowest price of the day. Paying $2 is worth it IMO.
VBS allows the option of "All or None" for a buy or sell. Used it today with no problems.
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tc101
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Post by tc101 » Wed May 26, 2010 4:29 pm

I think that all trades made to fill a single order on one day get only one commission but if that order is filled over several days you get a commission for each day.
That is correct. That is how the Vanguard rep explained it.
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Post by GammaPoint » Wed May 26, 2010 4:32 pm

I usually use 'all or none', although I'm usually buying in pretty small amounts so it wouldn't matter either way.

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Post by tc101 » Wed May 26, 2010 5:19 pm

Getting a partial fill means you are getting the lowest price of the day. Paying $2 is worth it IMO.
Most of the time that would be correct. Today I only got 9 shares and saved about 15 cents a share over the asked price when I placed the order. If the price goes up tomorrow and

We are talking about very small amounts of money here. This is a good learning experience.
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Re: Multiple commissions on partially filed ETF orders

Post by SP-diceman » Wed May 26, 2010 6:56 pm

tc101 wrote:Today I put in a limit order on a non vanguard ETF, good for 60 days. It was partially filled. I only got 9 shares, and a $2 commission. I just called Vanguard and learned that if it is filled or partially filled again tomorrow, I will get another $2 commission.

It is very unlikely, but in theory, if I leave the order open and only get a few shares a day every day for the next 60 days, I could pay a total of $120 in commissions on this one trade.

Something to think about with thinly traded ETFs.
I would think if you changed the limit a few cents
the whole thing would be filled.


Thanks
SP-diceman

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Post by LadyGeek » Wed May 26, 2010 8:44 pm

tc101 wrote:We are talking about very small amounts of money here. This is a good learning experience.
Speaking of learning, I just added your example to the wiki.

Please see Orders on the Bogleheads Wiki.

Comments / questions / corrections are welcome.
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.

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