Broker Ratings--

A

AAAintheBeltway

I hate to be critical of a free service, but I don't really understand the comments in the broker ratings section. Why would one RT broker have any better quotes or connections or executions than another? Don't they all come from the same source? Ok, I know some brokers use SP Comstock for quotes and others PC Quote, but the brokers themselves don't have anything to do with how fast or slow the service is. am I wrong about this?

The selection of one RT broker over another should turn on fees, policies, clearing and customer service . Fees and policies are pretty easy to understand. Customer service probably is not much of an issue for experienced traders.

Clearance seems to me to be important. This is an area where you can't tolerate errors, and financial stability is important, even if they all claim to have insurance. I know at one time people hated Soutwest Securities. Are they ok now? How about Instinet? Penson seems reliable but their reporting is hard to follow for me.

I am looking at JPR Capital. Their rates are rock bottom and they seem to know what they're doing. They clear through Southwest. Anyone have any experience?
 
AAA:

Why would one RT broker have any better quotes or connections or executions than another? Don't they all come from the same source?

Voodoo:
I believe they do, the source these days is TAL feed, Townsend Analytics own data feed.

AAA:
The selection of one RT broker over another should turn on fees, policies, clearing and customer service . Fees and policies are pretty easy to understand. Customer service probably is not much of an issue for experienced traders.

Voodoo:
Don't agree about customer service not being important, it lowers risk. Being able to dial and have the phone on the other side picked up immediately or being able to monitor a chat room where any possible problems are discussed even before they affect you personally is a big plus. Traders waiting to take your orders over the phone is another backup that could prove crucial.
The broker I use is also very good at helping resolve clearing problems, again, clearing systems fail sometimes.

Many brokers do not use RT, so that's why the coments about speed. IB from what I heard is significantly slower than RT brokers.

voodoo

edit: I guess <i> <b> and other quote tags don't work :confused:
 
There was a discussion about VTS and other platforms awhile back. One of the big differences is does the broker use the software's servers or their own. Do they route through the slow ISI broker for ECN routing ? How backed up are their servers? Can they handle all of their customers logged on and trading at the exact same time?

How about customer support? When I need out of a trade do they pick up on the first ring? or make you wait for 5?

rtharp
 
Originally posted by AAAintheBeltway
Why would one RT broker have any better quotes or connections or executions than another? Don't they all come from the same source? Ok, I know some brokers use SP Comstock for quotes and others PC Quote, but the brokers themselves don't have anything to do with how fast or slow the service is. am I wrong about this?
More...

I think you are wrong for several reasons:

1) In the case of an office-based firm, you are relying on the office internet connection to access the TAL, PC QUOTE, or Comstock quote servers. If a firm has a T1 line for all of the traders in the office to share, when it really should have multiple T1s or possible even a T3, then there will undoubtedly be data and execution problems, especially during peak times.

2) The firm may have chosen their ISP just because it was cheapest around. The ISP may not have the infrastructure to handle the demanding data traffic of a day trading office, which will of course screw up data and executions.

3) Although the quote data comes from one of the primary quotation companies, many brokers run their own order servers. These machines can easily slow down or fail during periods of high order flow, thus affecting order execution speed significantly. Order server problems affect office-based traders and remote traders as well.

4) I think everyone would agree that all trading platforms are definitely NOT equal. If a firm uses home-grown software that is resource-intensive and poorly designed, quote and execution speed can definitely be affected.
 
Baron,

OK, I agree that there are additional issues for a trading office and that not all software is created equal. I was really just talking about remote, RT brokers.

The idea of being able to get someone on the phone during an outage makes sense, but in my experience that is just not going to happen if there is a big systemwide problem. I think it is a good idea to have redundant connections and a backup broker for these issues.

The main question I have is do RT brokers differ in the way they handle orders? Baron, you say that some brokers use in house order servers and some do not. How do you know which is which, and do any RT brokers use in house order servers? Do the others use Townsend or does it go through the clearing firm? Is Townsend better?
 
I agree with rtharp, and i.m.o, the most important things are the speed of the soft to execute and confirm the orders, and so, the reliability of the customer support : if they make me wait 5' on the phone, it could be really disastrous if I need to be out of a trade in emergency because PC crash or DSL cut.
 
ADCtrader, voodoo, rtharp,baron,more,

Thanks for your input. All make valid points. I wish someone would answer my main question though, which rtharp and baron pointed up, namely do all RT brokers handle orders the same or do some use their own order servers and therefore might be suspect? And how do you ever find out?

I also suggest we compare notes next time there is a major outage to see which brokers were responsive and which left you on hold for 20 minutes.

ADC, are you still with JPR? They seem incredibly helpful over the phone. You actually talk to someone who seems in the loop, not a newbie customer service rep who started last week and has to look everything up.
 
I wish someone would answer my main question though, which rtharp and baron pointed up, namely do all RT brokers handle orders the same or do some use their own order servers and therefore might be suspect?

And while we're at it, does anyone know exactly what happens to orders, from the time I click the mouse to buy stock on Island, or SuperSoes, to the time the transaction is cleared. Any web pages or perhaps someone here could describe the entire process? I always wondered about that.

voodoo
 
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