I don’t “trade” stocks. I buy shares in companies I intend to keep for at least several months and more usually for several years or decades. I don’t like investing in the stock market because the volatility makes me uneasy. I can’t get a decent return, however, entirely from my fixed income investments at the current time. So I pick the occasional dividend-paying stock that appears to be a reliable source of income for part of my investment dollars. Today, I decided to buy some shares of a company that was being traded heavily at high volume and was on the slide; as usual I used a limited price order in my BMO InvestorLine account but what price did I actually pay?
If I Put In a Share Purchase Price of $40 Will I Pay Exactly $40 Using BMO InvestorLine?
I never buy or sell “at the Market Price.” I have this fear of technology and getting caught by a computer glitch that momentarily moves the price a few dollars per share too high or low. I always set a bid or ask price for any shares I’m buying or selling.
Usually, if my offer is accepted, the transaction occurs at exactly the price I offered.
Today, however, I got a deal!
I put in a bid at $40.68 for 200 shares of a pipeline utility stock that is in free-fall in part due to the rapid painful decline in the price of oil. That was a few cents per share lower than the trading range at the time.
I expected it to fill quickly as the stock was jumping up and down 1-2 cents every second.
How I Saved Money on My Share Purchase at BMO InvestorLine
Still, I was surprised when I checked the details on my fill a half hour later:
I had bought the first lot (100 shares) at $40.61 and the second lot (100 shares) at $40.60!
So even though I had authorized BMO InvestorLine to bid $40.68, I had paid 7 and 8 cents less per share on two lots.
How I Traded for Free Today at BMO InvestorLine
The savings is not substantial, of course. I saved $15. However, since I only pay $9.95 a trade, it means I made the purchase “for free” versus my original decision to buy and I saved an additional $5.05. Not bad!
Can I Expect to Save Money Like This Often at BMO InvestorLine?
I don’t expect to see the same savings any time soon at InvestorLine. Over the course of a couple of dozen trades over three years, I’ve only had this happen once before. Still, it was a pleasant surprise.
I have NEVER had a purchase or sale go through that cost me more than I bid, by the way.
PS I have very carefully NOT checked just how far that stock I purchased today has slid by the end of the day. Something tells me I would have saved even more by waiting till tomorrow to buy it. Still, it was a fair price by my estimates at what I paid so I will just ignore it if I could have received an even bigger bargain by waiting.
- How to Purchase Shares at BMO InvestorLine
- How to Buy Stocks Using the InvestorLine App
- Is There a Minimum Number of Shares I Can Buy of a Stock?
Have you ever had a purchase fill at a lower price than you offered at your brokerage? Please share your experience with a comment.