Breaking: Interactive Brokers lite commission free

[Maverick2608]

The most important piece of information to gauge the attractiveness of zero commission is:

What payment per share does the broker receive when they sell your order?

Anyone?

 

[mskl]

you got it

this is not a good thing for existing active users

they will need to allow trading with api or tws to compete with free brokers, or they will bleed customers over time

Exactly. This is not for existing users. Just like that recent marketing campaign "Bet, Learn, Win".

Nothing in this for "active" existing customers who use the tws/api. 20+ years of loyalty and constant 6 figure commissions paid and nothing in this for me (once again). On some level I feel insulted by this.

But I will be patient......

 

[qlai]

The most important piece of information to gauge the attractiveness of zero commission is:

What payment per share does the broker receive when they sell your order?

Anyone?

Why is it important? When you buy groceries, do you ask them what their margin is? PFOF is not the only way to make money on the orders.

 

[tonyf]

Exactly. This is not for existing users. Just like that recent marketing campaign "Bet, Learn, Win".

Nothing in this for "active" existing customers who use the tws/api. 20+ years of loyalty and constant 6 figure commissions paid and nothing in this for me (once again). On some level I feel insulted by this.

But I will be patient......

The only game changer for people like us is independent custody and API where we can route orders to multiple brokers from a spreadsheet...

 

[d08]

I'm not familiar with Gateway, but why can't they allow Lite accounts trade via Gateway? Should not require any development for them and they would hit a few birds with one stone. If Robin Hood creates a decent API ...

API has routing options which are not available in this Lite version, they'd have to modify a lot.

 

[d08]

Why is it important? When you buy groceries, do you ask them what their margin is? PFOF is not the only way to make money on the orders.

It's by far the most important thing. Buying groceries, you can compare prices easily - when trading you'd have to trade side-by-side to see how much better execution actually is. Execution differences are actually dramatic and I suspect Robinhood traders in practice pay more to trade than I do despite them thinking it's "free". People are notoriously ignorant about math.

 

[trend2009]

if the order is limit for liquid stocks, I doubt the order information sold to funds would affect the trader at all.

 

[tommcginnis]

TWS is an entire rolling tool cabinet 4' high with a dozen drawers and 3-4 cabinets.

MOST TWS users have learned how to open 1 drawer, and bitch/complain about the things they wish to do, having no idea of the rich conformability of the platform in front of them. These users are IB's target market for "Lite."

This "LITE" thing is IB's recognition that TWS -- despite 1,000 pages of documentation and hours of webinars -- is simply too much for the majority of customers. It can also re-brand TWS as something meant for traders who take their trading seriously. Hence, "Pro." {Which is to say, for whom a highly-customizable platform and "Direct Market Access" have some meaning.}

 

[qlai]

It's by far the most important thing.

I'm saying it's irrelevant how much they make on your orders, not that execution quality is irrelevant. Just because they get paid for flow, doesn't automatically mean you get worse executions.

 

[d08]

I'm saying it's irrelevant how much they make on your orders, not that execution quality is irrelevant. Just because they get paid for flow, doesn't automatically mean you get worse executions.

That last part is almost never true. The only reason to buy order flow is to give worse execution, otherwise you'd just use the free flow. There's no free lunch.