Alpaca pricing seems quite shady, hope you guys can clear this up.
You should create an exhaustive pricing page and link it on your homepage.
While you advertise commission-free trading, it seems that several users are being charged 0.4 cents per share:
Here you explain reasons users can be flagged as non-retail:
Apparently if you start making too much money (bigger order sizes) and try to avoid paying slippage (by splitting up your orders or trading the auctions), they will arbitrarily start charging you extra fees.
I don’t understand why alpaca needs to flag certain accounts and charge them commissions, since other commission-free brokers don’t have a similar policy. If you aren’t taking advantage of users, what’s the cost of having users that can trade well on the platform? Seems that Alpaca only wants users who trade poorly and pay a lot of slippage, if you win too much they kick you out like a casino.
Aside from the forum post (and other similar posts on the web), i cant find a page mentioning this 0.4 cents fee anywhere.
What I would like to know is, do these 0.4 cents also apply to users paying the 99$/month under the “unlimited plan”( “for algo traders and quants”), or “professional plan” (“for professional traders and hedge funds”)? What about people building with the broker api? Can they also randomly start getting charged these fees for each trade? This is all unclear.
How can we trust a broker whose main advertising point is “zero fees”, targeting “algo traders and quant funds” but at the same time reserving the right to start charging random fees to any customer?
Hope this policy will be changed or clarified.
@licnep Alpaca intends and tries to be transparent with all fees which are charged. On the homepage there is a link
That link displays
Note the text “Commission free trading is available for Alpaca’s retail customers. Alpaca reserves the right to charge additional fees if it is determined that orders flow is non-retail in nature.” There aren’t any hard rules defining ‘retail’ order flow but there are some guidelines in this FAQ. Less than .1% of all Alpaca accounts are ‘non-retail’ so this doesn’t apply to most traders.
Alpaca works with a number of execution partners who actually execute the trades. Many of those partners pay Alpaca for orders we pass to them which then allows Alpaca to offer those trades commission free. However, each execution partner has guidelines for the types of orders they accept, and each partner has slightly different guidelines which is why there aren’t hard rules for which orders are considered commission free. In any case, the determination is made on an account basis and not an order basis. One will never see a charge without first being notified, and given the option, to going with a non-retail account.
To answer the specific questions
"do these 0.4 cents also apply to users paying the 99$/month under the “unlimited plan”.
The data plan one subscribes to is completely entirely separate from trading and therefore does not impact any trading fees. Market data is a standalone product one can subscribe to but one could also subscribe to any third party data as well. There is no impact to how orders or trades are executed.
“What about people building with the broker api?” Order fees for developers using the Broker APIs are generally negotiated on an individual basis. However, 99%+ of all those orders are again commission free because they are ‘retail’ in nature.
"Can they also randomly start getting charged these fees for each trade? " No, fees will never be charged without first discussions with the account holder. If an account is determined to be placing too many non-retail type orders, an associate from the Alpaca Trading Team will reach out and 1) give the account holder an option to change their order characteristics back to ‘retail’ or 2) negotiate a commission fee.