Here at Double, we strive to provide transparency in our trading cost estimations. We model potential trading costs based on the historical bid-ask spread.
To do this we gather the National Best Bid and Offer data every day for securities that are tradable on Double. By averaging the daily 50th percentile bid-ask spread over the past 90 calendar days, we aim to capture a realistic estimate of the stock slippage that may occur during trade execution. In cases where Best Bid and Offer (BBO) data is unavailable, we utilize a default value of 3 basis points (bps) to account for potential slippage.
Important Disclaimers:
Past Performance: Historical bid-ask spreads are not always indicative of future market conditions or trading costs. Actual slippage may differ significantly from our estimates due to market volatility, order size, and other factors.
Other Costs: Our model focuses solely on estimating slippage costs related to bid-ask spreads. It does not encompass other potential trading costs, such as commissions, exchange fees, or taxes.
No Guarantees: This information is for educational purposes only and does not constitute financial advice. We make no representations or warranties regarding the accuracy or completeness of our estimations.
Consult a Professional: Trading involves risks and may not be suitable for all investors. Before making any investment decisions, it is crucial to consult with a qualified financial advisor who can assess your individual circumstances and risk tolerance.
Not an Offer: The content provided herein is not an offer to buy or sell any securities or financial instruments. Investing involves inherent risks, including the potential loss of principal.
While we strive to provide valuable insights into potential trading costs, it is essential to remember that all investments carry inherent risks.