# People who buy little amounts of shares



## LiL_JaSoN (7 March 2011)

Why is it sometimes when i look at the course of sales, there is alot of little amount of shares sold

eg - 1 - 10, or values less than $500, like 30$, or 100$ etc.

Jason


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## Agentm (7 March 2011)

LiL_JaSoN said:


> Why is it sometimes when i look at the course of sales, there is alot of little amount of shares sold
> 
> eg - 1 - 10, or values less than $500, like 30$, or 100$ etc.
> 
> Jason


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## LiL_JaSoN (7 March 2011)

I thought it maybe bots, but wouldnt it still charge them brokage?


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## ROE (7 March 2011)

LiL_JaSoN said:


> Why is it sometimes when i look at the course of sales, there is alot of little amount of shares sold
> 
> eg - 1 - 10, or values less than $500, like 30$, or 100$ etc.
> 
> Jason




ignore them cover numerous time on this forum, algorithm and bot trading


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## Tyler Durden (7 March 2011)

While we're at it, I've been wondering, if I want to avoid the $500 minimum and just buy $10 worth of shares, could I just buy, say, for example 510 shares and then do a sell order of 500 immediately after?


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## ROE (7 March 2011)

Tyler Durden said:


> While we're at it, I've been wondering, if I want to avoid the $500 minimum and just buy $10 worth of shares, could I just buy, say, for example 510 shares and then do a sell order of 500 immediately after?




You can then you left with an unmarketable parcel, ie you cannot sell that $10 worth until you get another $500


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## pixel (7 March 2011)

LiL_JaSoN said:


> I thought it maybe bots, but wouldnt it still charge them brokage?



 The Brokers - or more likely the big Instos - own those 'bots. So they don't charge themselves brokerage on every single trade; even the "better-equipped" online brokers will let their clients bundle a certain number of small trades (same share, same direction, same day) and only charge one brokerage per contract note.

PariTrade: http://www.paritrade.com.au for example, let me take up to a dozen little bites out of the same cherry and only charge once for the Total.


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## Agentm (7 March 2011)

man.. thats so weird

i thought bots were lonely little whooh bots with pocket munney buyin whittle shares..

now i hear they r instos..


crazy world..

imho bots are positive,, means they see value,,


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## Wysiwyg (7 March 2011)

It is a pointless exercise and should be banned. The amounts are too small to move the market, they have insignificant impact on the daily volume and only artificially inflate the daily number of trades. So really what is the point of doing it? Brokers ????


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## Tyler Durden (7 March 2011)

ROE said:


> You can then you left with an unmarketable parcel, ie you cannot sell that $10 worth until you get another $500




There is a minimum sell amount as well?!?!



pixel said:


> The Brokers - or more likely the big Instos - own those 'bots. So they don't charge themselves brokerage on every single trade; even the "better-equipped" online brokers will let their clients bundle a certain number of small trades (same share, same direction, same day) and only charge one brokerage per contract note.
> 
> PariTrade: http://www.paritrade.com.au for example, let me take up to a dozen little bites out of the same cherry and only charge once for the Total.




I asked this before and didn't get a response, but the general attitude seems to be that bots are used to keep prices down. If this is the case, why not use bots to bring BHP shares down to 10 cents?


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## skyQuake (7 March 2011)

Tyler Durden said:


> There is a minimum sell amount as well?!?!
> 
> 
> 
> I asked this before and didn't get a response, but the general attitude seems to be that bots are used to keep prices down. If this is the case, why not use bots to bring BHP shares down to 10 cents?




Bots are used to break down a large order. Thats all there is to it.

eg mkt depth shows 5k shares every level but Im a fund manager with 100k shares to sell i wont hit market. I'll get the algo to sell bits and pieces here and there. Program it to sell into strength or let the market drift up then sell etc.


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## Tyler Durden (8 March 2011)

skyQuake said:


> Bots are used to break down a large order. Thats all there is to it.
> 
> eg mkt depth shows 5k shares every level but Im a fund manager with 100k shares to sell i wont hit market. I'll get the algo to sell bits and pieces here and there. Program it to sell into strength or let the market drift up then sell etc.




I understand now, thanks


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## Beams (8 March 2011)

For the pros:

Is there any truth to small volume buying to test the waters? Eg. The indicators are looking good, but this share has burnt me before, Ill buy small amount eg. $100 to force me to watch it and commit larger if it shows signs of being a winner?


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## skyQuake (8 March 2011)

Beams said:


> For the pros:
> 
> Is there any truth to small volume buying to test the waters? Eg. The indicators are looking good, but this share has burnt me before, Ill buy small amount eg. $100 to force me to watch it and commit larger if it shows signs of being a winner?




Not that I know of.


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## Julia (8 March 2011)

Beams said:


> For the pros:
> 
> Is there any truth to small volume buying to test the waters? Eg. The indicators are looking good, but this share has burnt me before, Ill buy small amount eg. $100 to force me to watch it and commit larger if it shows signs of being a winner?



 As far as I know you can't buy only $100 worth of anything.
And how will that prove a thing?  Why not just paper trade or simply observe a company's performance before making a decision?
Either you believe something is worth buying or you don't.


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## Beams (8 March 2011)

Julia said:


> As far as I know you can't buy only $100 worth of anything.
> And how will that prove a thing?  Why not just paper trade or simply observe a company's performance before making a decision?
> Either you believe something is worth buying or you don't.




Yeah I suppose your right. My thinking was that having actual shares in any quantity forces an eagle eye over prices movements, as opposed to the casual glance in free time.


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## pixel (8 March 2011)

Julia said:


> As far as I know you can't buy only $100 worth of anything.
> And how will that prove a thing?  Why not just paper trade or simply observe a company's performance before making a decision?
> Either you believe something is worth buying or you don't.



 If you spread your buy orders over a day and end up with a marketable parcel, I'm sure you can take small bites. Since the advent of algothmic trading (aka "bots"), the ASX no longer insists (if they ever did) that you buy at least $500 worth every time; and online brokers have followed the trend and will allow you to buy a few here, a few there, then still charge you only one brokerage per contract note.

There are at least two ways one can take advantage of this opportunity:


When a stock moves up and down during a day, buy some low, sell at resistance, buy back during the lunch break (quite often a time of lull), and sell back towards the end or top up if the chart suggests the rise may continue next day.
When you are unsure whether the reversal is finding follow-through, buy only a small position at support; if your hunch (or chart reading) was good enough, keep buying until you have a full position. That way, you have a low-risk, low cost-base entry, which can be especially helpful for newbie traders, who find their insecurity psychologically challenging and tend to procrastinate even though they should know better.


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## Julia (9 March 2011)

pixel said:


> If you spread your buy orders over a day and end up with a marketable parcel, I'm sure you can take small bites. Since the advent of algothmic trading (aka "bots"), the ASX no longer insists (if they ever did) that you buy at least $500 worth every time; and online brokers have followed the trend and will allow you to buy a few here, a few there, then still charge you only one brokerage per contract note.



I've just run this by Etrade who contradict what you say.  They say they definitely have a min parcel of $500 and that this applies to most other online brokers also.


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## pixel (10 March 2011)

Julia said:


> I've just run this by Etrade who contradict what you say.  They say they definitely have a min parcel of $500 and that this applies to most other online brokers also.



 E*Trade may still have the old rule; and if they say "most other" onliners still have similar rules, they may also be correct. One of my former online providers had a similar rule - which caused the status change to "former". :
DYOR, and if you wish to trade more flexibly, change to one that offers more flexibility.


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## boofhead (10 March 2011)

I know Commsec allow trades less than that although I did have a bigger order it was only partly filled. $200

Seller dropped price to sell me 2 units. Only 2 units traded at that price for the day. Somewhat annoyed but I guess that's the price of buying something with not much liquidity.


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## Julia (10 March 2011)

boofhead, as with pixel's remark, I've just phoned Comsec about this.  They are emphatic that $500 is their minimum parcel.
So I don't know what you mean unless it's that your order was partly filled at one stage to the value of $200.
That doesn't constitute the broker allowing a TOTAL buy order to the value of $200.
Companies that have low liquidity can take days to fill an order in small dribs and drabs.


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## luke256 (10 March 2011)

ROE said:


> You can then you left with an unmarketable parcel, ie you cannot sell that $10 worth until you get another $500




On etrade (over a year ago) i was able to sell a parcel of shares with a market value less than $500.

I sold some IAG shares and forgot about the DRP i was entitled to and a few days later i saw about $300 of IAG shares in my account. I was able to sell these through etrade even thou the mv was less than $500.

Maybe some of the DMA CFD brokers allow people to trade parcels under $500. 

I think Julia's explanation regarding illiquid stocks is probably the best reason.


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## jimmyizgod (10 March 2011)

luke256 said:


> On etrade (over a year ago) i was able to sell a parcel of shares with a market value less than $500.
> 
> I sold some IAG shares and forgot about the DRP i was entitled to and a few days later i saw about $300 of IAG shares in my account. I was able to sell these through etrade even thou the mv was less than $500.
> 
> ...




you are able to sell less than $500 of shares, but the minimum BUY is $500


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