[cuban leaf]

I bought a few stocks in the early 90’s. I’ve never heard of the round lot and those were not round lots or close. I think that is a relic of the days before the 1980’s.

[SeekAndFind]

RE: I bought a few stocks in the early 90’s. I’ve never heard of the round lot and those were not round lots or close.

A larger player only had to make a fraction of a percent to pay for his commission. This is why the institutions and big investors ruled the markets and the little guy was shut out. This “hurdle” made the individual investor stay in a trade longer just to get to profit territory. So he traded less often.

He was also priced out of buying stocks such as Amazon or Nvidia which have stock prices of over $3,000 and over $700 per share.

A round lot of Nvidia would be $70,000 just for that one position! Most individuals don’t have that kind of money to trade in a single stock if they’re trying to be diversified into 10-25 stock.

But Now, we have “fractional share” ownership. Anyone can buy just a slice of Amazon with as little as $50. This fractional ownership, which only just came onto the scene in the last few years, has solved the round lot problem and made it a term we may never hear about again.

[Mouton]

It was a testament to how the “system” worked before the advent of the discount brokers. Further complicating things was the trades were made in 1/8s or 1/4s point or more on more expensive stocks. There was no option market either except through “houses” that gave you a take it or leave it price which was not on a quote machine. Broker commissions were I believe regulated to boot. The backoffice bureaucracy was stifling too. Lastly, you got into your possession actual stock certificates if you wanted them.

[vikingd00d]

oddlot trading has been around since at least the 1940s.