Re: Bid - Ask spread

From: MsProf2U <MsProf2U@aol.com>
Subject: Re: Bid - Ask spread
Date: Mon, 25 May 1998 22:08:00 -0400 (EDT)

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<<No, you avoid none of this by using limit orders.  All you do is assure that
you get a specific price **IF** you get any transaction at all.  Bid-ask
spreads, payment for order flow, etc. all still exist and are factored into
your transaction.>>

I phrased my letter poorly. Of course all the above still exist; what I meant
was that I determine what I'm willing to pay for a stock, then I set that
limit. I dislike the uncertainity of market orders. Especially since I do a
lot of quick-trading.

<<You will, of course, avoid paying a higher price.  But, for that assurance,
you might miss the transaction entirely.  Perhaps you avoid paying an extra
fraction, but you might end up missing a good stock entirely.>>

When I began investing fifteen years ago, I used to believe that. Now, at the
ripe old age 38,  ;) I've learned that when one bus leaves another one is
usually right behind it. I've rarely missed out on anything by being unwilling
to pay its current asked price -whether it's for a stock, a car, or a house. 



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