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Launch HN: Double (YC W24) – Index Investing with 0% Expense Ratios

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Re: Launch HN: Double (YC W24) – Index Investing with 0% Expense Ratios

#341

Post by rjrdi38dbbdb »

WiSaGaN wrote: post #288
wrsh07 wrote: post #25

Earlier quoted context omitted.

Pfof is woefully misunderstood In general, citadel wants to pay to trade with retail investors because it knows it isn't going to face adverse selection. So it will give them tighter bid/ask ratios (this is better for the customer) than they would get if they were trading in the open market, citadel isn't going to get hosed by one of them (because there's no adverse selection) It's win win win

It's not. Centralization of liquidity is better for everyone. HFT thrives on fragmentation of liquidity. HFT is not wrong, but fragmentation of liquidity is.

Nope. It's not better for known uninformed traders. If you mix them in with informed traders, market makers must widen spreads.

This is very obvious in institutional FX. Pure "retail" flow will get quoted much tighter spreads by banks and market makwrs than you'll see on any ECN. Yes, it can get skweded against predictable flow, but a true "noise" trader won't be affected by that and will definitely be better off with tailored liquidity.

Re: Launch HN: Double (YC W24) – Index Investing with 0% Expense Ratios

#342

Post by johnnyo »

jjmaxwell4 wrote: post #216
hn_throwaway_99 wrote: post #16

I saw the "Your Money is Secure" section, but after things like the Synapse fiasco, I would like to get confirmation from you. It says my money would be SIPC insured, which means if anything goes missing (obviously not through loss of equity value, but through missing funds or a ledger bug), I get my money back, up to the SIPC limit, right? I just want to ensure this isn't the same situation with fintechs that say yo…

If Double goes out of business, your assets are safe and held in your name at Apex Clearing. They have processes in place for these scenarios to help you access and transfer those assets. SIPC protection covers against a brokerage firm failing, which in our case is Apex Clearing. We are not currently a brokerage so SIPC would not apply if Double goes bankrupt.

How are the SIPC premiums being paid?

Let’s say I invest $250k with you. From my research it appears the SIPC premiums on that amount would be more than $12/year.

How does that work?

Re: Launch HN: Double (YC W24) – Index Investing with 0% Expense Ratios

#343

Post by WiSaGaN »

rjrdi38dbbdb wrote: post #341
WiSaGaN wrote: post #288

Earlier quoted context omitted.

It's not. Centralization of liquidity is better for everyone. HFT thrives on fragmentation of liquidity. HFT is not wrong, but fragmentation of liquidity is.

Nope. It's not better for known uninformed traders. If you mix them in with informed traders, market makers must widen spreads. This is very obvious in institutional FX. Pure "retail" flow will get quoted much tighter spreads by banks and market makwrs than you'll see on any ECN. Yes, it can get skweded against predictable flow, but a true "noise" trader won't be affected by that and will definitely be better off wit…

You don’t have to trade with market makers.

Re: Launch HN: Double (YC W24) – Index Investing with 0% Expense Ratios

#344

Post by frakkingcylons »

I'd be interested to see your rates for margin if you do decide to offer margin.

I don't use the margin to get more market exposure. I treat it as a lower APR credit card with a sizable credit limit. Interactive Brokers will charge me 6% instead of 20+% of a typical credit card. I don't use it much, but I like having it. I don't know if it makes business sense to offer lower margin rates than IBKR to retail customers, but I'd be interested. Before someone lectures me: I consider 10% of my holdings to be my "credit limit".

Re: Launch HN: Double (YC W24) – Index Investing with 0% Expense Ratios

#345

Post by rjrdi38dbbdb »

WiSaGaN wrote: post #343
rjrdi38dbbdb wrote: post #341

Earlier quoted context omitted.

Nope. It's not better for known uninformed traders. If you mix them in with informed traders, market makers must widen spreads. This is very obvious in institutional FX. Pure "retail" flow will get quoted much tighter spreads by banks and market makwrs than you'll see on any ECN. Yes, it can get skweded against predictable flow, but a true "noise" trader won't be affected by that and will definitely be better off wit…

You don’t have to trade with market makers.

So you're hoping get price improvement by crossing with other trader orders in the book?

Unless you have a good high frequency predictor and low latency order management (you don't), you're going to experience adverse selection. Either because you're taking resting orders that HFTs are smart enough to avoid or because your resting orders get run over by informed traders.

Re: Launch HN: Double (YC W24) – Index Investing with 0% Expense Ratios

#347

Post by voidmain0001 »

eagleinparadise wrote: post #317
bboygravity wrote: post #253

Earlier quoted context omitted.

Search keywords: Apex clearing and trade 385. They're basically criminals. A guarantee by Apex is worthless IMO.

Alright, I did the google search based on your incendiary comment and whatever you're trying to suggest does not seem to be the case. pg 79: https://democrats-financialservices.house.gov/uploadedfiles/... "Apex provides these same clearing services to many other introducing brokers, including Ally Invest, Betterment Securities, M1 Finance, Marcus by Goldman Sachs & Co., SoFi Securities, Stash Capital, Tastyworks Inc.…

There are some Reddit threads about this - https://old.reddit.com/r/Superstonk/comments/1dz57am/trade_3...

Take them with a grain of salt.

Re: Launch HN: Double (YC W24) – Index Investing with 0% Expense Ratios

#348

Post by murderfs »

e1g wrote: post #125
jjmaxwell4 wrote: post #109

Earlier quoted context omitted.

The account is opened in your name and your securities are held in your name at Apex Clearing. Apex has more than 19M brokerage accounts opened. We are Registered Investment Advisor (RIA) regulated by the SEC.

If you want to hold people's serious money and not play money, understand that priority #1 is not growth or expense ratios - it's risk mitigation. Swiss banks are notoriously expensive and have terrible investment products that hold trillions because of their obsession with protecting capital. As a startup, you must figure out how to convince ordinary people to change their family safety net. Full transparency, audit…

> Swiss banks are notoriously expensive and have terrible investment products that hold trillions because of their obsession with protecting capital.

What? Their second largest bank, Credit Suisse, imploded only last year. They hold trillions because of their nominal neutrality (though their cooperation with western sanctions against Russians appears to be hurting this significantly) and banking secrecy laws that serve as shelter for proceeds for all sorts of crimes.

Re: Launch HN: Double (YC W24) – Index Investing with 0% Expense Ratios

#349

Post by stocknoob »

divbzero wrote: post #330
_benj wrote: post #290

Hi, and congrats on the launch! I'm curious about how this service compares to, say, the offerings of zero expense mutual funds from Fidelity of Schwab? I guess there's a lot more variety since I don't think those brokers have 50+ indexes. Have you found or might expect to find liquidity issues or spread costs with fractional shares? I imagine that if you have an account with, say, $3000 that is trying to implement S…

> If you could convince me that I could implement, say, S&P 500 and be cheaper, more tax effective than holding those ETFs, that would be something interesting! The lowest-cost S&P 500 index fund currently has an expense ratio of 0.015%. Assuming similar performance (minimal tracking error) Double's fee of $12 per year would cost less for any portfolio over $80,000.

The zero fee total market funds are almost identical to S&P

https://portfolioslab.com/tools/stock-comparison/FZROX/SPY

Unless you have a very good reason, just go for the cheapest.

Re: Launch HN: Double (YC W24) – Index Investing with 0% Expense Ratios

#350

Post by charlie0 »

Glyptodon wrote: post #243

Looking through the surface level details of Double, I quite like what I'm seeing. That said, I use Schwab, Wealthfront, and M1 and am not entirely happy with any of them so I am probably a targeted type of customer. I haven't lookeded too deeply (no idea if implementing things like HFEA style leveraged portfolios in an efficient way is possible, for example, or if there are non-index means of handling hold-till-matu…

What is it you don't like about M1?
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