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September 19, 2012, 07:48:54 PM |
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There would be significantly more trade on MTGox if they updated there commission schedule. Charging a percentage (instead of a flat fee) makes it impossible to momentum trade. It would be nice if I could trade 1000 shares at a time and make a few pennies. If I buy BTC at 12 (assuming a .5% commission), I have to sell it at 12.10 just to break even. Assuming risk, that really means I need to sell it at $13, and that's not a momentum trade. This problem will get worse as the price rises.
Percentages work great for the one-time investor if the price is $3 and you buy 10 BTC, but if you want liquidity in a market, you need momentum traders. I hope they decide to put a cap on the per trade commissions soon.
The good thing is, when they do this, BTC price will rise significantly just from the act of traders taking positions.
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