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Closing my IB account
- Thread starter Trade_Cents
- Start date
Originally posted by SProbability
So what are the alternatives to IB for trading the Minis? Requirements:
1) More reliable system than IB
2) Very good bandwidth for phone orders
3) Helpful, friendly & knowledgeable Customer Sevice
4) Commission less than $10 a round turn
5) Take financial responsibility for system outages
No 5 might be asking too much, but one can dream.
For me it's all about risk management. Let's say IB works fine 95% of the time, but the 5% it doesn't work your gains for say only one month are wiped out. Is it worth it? I think I would prefer to pay higher fees, if nothing else for the peace of mind.
As traders, we already have too many hurdles to scale and shouldn't have to accept liabilty for somebody else's failure, especially when you pay them to deliver a good service.
try FFastTrade US LLC
ffastfill
My 2 cents. Trade with IB to get low commish on the 97% of the time they are up. Establish an alternative account with option permissioning w/ any other broker-even old fashioned telephone broker. Having a backup broker will work in most cases except for when the system hangs whle you have an unfilled order since you don't know whther you are flat, long, short.,etc. That is why it pays to brush up a little on your options.
Scenario 1: You have a position on and system is down. Pick up the phone and hedge with stock to flatten or establish synthetic position so you limit downside and still participate upside.
WORST CASE is...
Your orders hang so you don't know whether you are long 1000, or flat or sometimes in a fit of panic you press the button more than once so now the ? is are you long, flat , short 1000,2000,Yikes...
Call your option guy and hedge at least 1/2 your position.As the market move against you on your possible position, buy more protection.
Eg you are long 1000 shares of xyz and you don't know if you sold it out since system went down when you submitted your sell 1000.
Hedge 1/2 of position initially and watch it. If xyz keeps going down buy a couple more, worse case you did flatten out the stock and you are long puts on an averaging down basis. Your screwed is xyz whips back up hard, BUT you've got the gamma of the option working for you so as it whips back up you are getting hurt less and less.
Bottom Line: Any system outages will COST you money! That is the price WE pay for the benefit of waking up, rolling out of our bed and being ready to trade anywhere in the US. The question is will the losses be manageable or catastrophic.
Scenario 1: You have a position on and system is down. Pick up the phone and hedge with stock to flatten or establish synthetic position so you limit downside and still participate upside.
WORST CASE is...
Your orders hang so you don't know whether you are long 1000, or flat or sometimes in a fit of panic you press the button more than once so now the ? is are you long, flat , short 1000,2000,Yikes...
Call your option guy and hedge at least 1/2 your position.As the market move against you on your possible position, buy more protection.
Eg you are long 1000 shares of xyz and you don't know if you sold it out since system went down when you submitted your sell 1000.
Hedge 1/2 of position initially and watch it. If xyz keeps going down buy a couple more, worse case you did flatten out the stock and you are long puts on an averaging down basis. Your screwed is xyz whips back up hard, BUT you've got the gamma of the option working for you so as it whips back up you are getting hurt less and less.
Bottom Line: Any system outages will COST you money! That is the price WE pay for the benefit of waking up, rolling out of our bed and being ready to trade anywhere in the US. The question is will the losses be manageable or catastrophic.
Originally posted by stevet
i assumed he meant stocks as he would not be trading that much size at IBs futures prices, its on the edge, but i am sure he could get lower commish - would not stop the breakdowns though - but he might get a freindly voice to soothe the pain
p.s i bet he's had a few emails from some freindly and helpful brokers!
p.p.s maybe a post like that is a great way to get your commish down!!
You will shortly be in that club ...
Originally posted by ElvisOnMargin
As I read his post, his essential--and legitimate--beef is not about the outage or not being reimbursed for his loss: it's about not being able to pick up the phone during the outage and act on his positions as needed. Outages are going to happen once in a while: it's a given. Telling him to use stop orders (which some people don't want to use and I'm one of them, having been picked off once too often) or to keep a second account somewhere else is just going on a tangent. He may make 20 times the money you make trading and don't need your advice on how to manage his account or his trades.
Elvis
Exactly. I understand system downtime is going to happen but not being able to phone in an order is unacceptable.
Originally posted by metooxx
Your kidding, right?
LOL
i could ask scalpers the same thing. i always knew these guys put their brokers' kids through college by churning their accounts into the stratosphere; it's still a mild shock to see hard numbers though.
Ever wonder why growth stocks always get hit harder than value stocks when the boom goes bust? Because they tend to be smaller companies and/or have higher fixed costs relative to incoming profit (like hard dollar commission costs).
Lean businesses with low absolute costs relative to the profit stream can weather drought periods without fear of going under. Strong survivability.
But expensive businesses with high fixed costs- i.e the ones that need significant profits month in and out just to pay their nut- are much more likely to die of thirst when the drought comes. Weak or even zero survivability.
The only businesses where high fixed costs or razor thin margins make sense are the ones with extremely high probabilities of continuation, a built in structural edge, or both. Grocery store chains can have razor thin margins, for example, because they have mass economy of scale and people always need to eat.
Small traders are the exact opposite of grocery stores- high exposure to drought, no built in structural edge, finite capital, nowhere to hide when profits take a siesta but costs don't. They are the WORST candidates for the high cost model business. In fact, the real world odds are SO tilted against the "at home market maker" or the "off the floor floor trader" that the only way he could really survive and thrive is if there were a temporary strong aberrance in his favor, like, say, a monsoon in the desert- or a major bull run in stocks, where so much cash was flowing it swamped all other negative considerations. Like the bull run we just saw. Which is now over. Hmmm...
But hey, different strokes for different folks.
Originally posted by darkhorse
LOL
i could ask scalpers the same thing. i always knew these guys put their brokers' kids through college by churning their accounts into the stratosphere; it's still a mild shock to see hard numbers though.
Ever wonder why growth stocks always get hit harder than value stocks when the boom goes bust? Because they tend to be smaller companies and/or have higher fixed costs relative to incoming profit (like hard dollar commission costs).
Lean businesses with low absolute costs relative to the profit stream can weather drought periods without fear of going under. Strong survivability.
But expensive businesses with high fixed costs- i.e the ones that need significant profits month in and out just to pay their nut- are much more likely to die of thirst when the drought comes. Weak or even zero survivability.
The only businesses where high fixed costs or razor thin margins make sense are the ones with extremely high probabilities of continuation, a built in structural edge, or both. Grocery store chains can have razor thin margins, for example, because they have mass economy of scale and people always need to eat.
Small traders are the exact opposite of grocery stores- high exposure to drought, no built in structural edge, finite capital, nowhere to hide when profits take a siesta but costs don't. They are the WORST candidates for the high cost model business. In fact, the real world odds are SO tilted against the "at home market maker" or the "off the floor floor trader" that the only way he could really survive and thrive is if there were a temporary strong aberrance in his favor, like, say, a monsoon in the desert- or a major bull run in stocks, where so much cash was flowing it swamped all other negative considerations. Like the bull run we just saw. Which is now over. Hmmm...
But hey, different strokes for different folks.
How much a day do you pay in commisions?
So, if the system is down, then what is the status of your server held stops?