|
PureBytes Links
Trading Reference Links
|
In a message dated 98-05-19 09:32:29 EDT, azlcpa@xxxxxxxxxxxxxxx writes:
<<
Although Commissions and Slippage may be (somewhat?) outside the traders
control, from a business accounting perspective they are variable expenses; no
trade, no expense.
Data feed would be a better example of a fixed cost; trade or not, this bill
must be paid.
>>
Asher,
You are correct. As ona accountant said to me about a similar cost in a
manufacturing setting "they are a variable fixed cost" . After hearing that
explanation I was glad I was getting ready to change professions.
I looked at it as a fixed cost because I typically have a pretty good handle
on how many trades per month my system will generate and I can also determine
in advance what my average margin of success needs to be to cover my costs.
So as a result I consider them as fixed. Regardless, as you pointed out the
real issue is how does that cost impact my system and how do I evaluate that
cost.
Thanks for your input.
Terry Quinn
|