Cost Structure for CME Futures Traders

Quote from scalper21:

My accountants clients are primarily traders. He understands the business. He was an options trader before he did taxes for traders.

Thank you for adding your opinion about the topic. It is helpful that all the traders on this board understand all the costs/benefits of CME membership.

I trade 300-1200 sides a day. My only option is trading as a member.
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Hi scalper,

I just sent you a pm...
 
Quote from jim c:

I know you cant say exactly and there are alot of variables but what could one expect, being a member, to pay round turn or per side. Even if you paid 25 cents per round turn on the commision. thx jim
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For the ES:

with IOM ($195,000) -> $0.69 per turn + up to $50 per day for Globex fees.

For ER2:

with GEM ($27,000) -> the rate is the same

For both with ECM ($1000 app fee) -> $1.38 per turn all in.

The CBOT products are a bit different. Is this what you are asking?

The best way to do this is to see how much you trade (turns per month) and then compute the fees across different products. For many people, for example, who trade the ER2, they will quickly find that BUYING a membership is actually cheaper when amortized over 2 years or whatever. This is even more true for the YM on the CBOT.
 
Quote from FuturesTrader71:

For the ES:

with IOM ($195,000) -> $0.69 per turn + up to $50 per day for Globex fees.
So this is .69 per round turn..in and out? I guess im confused with "per turn".
For both with ECM ($1000 app fee) -> $1.38 per turn all in. So with ECM its more @ 1.38 per round turn. sorry im a little thick. i can see where the best deal would be to purchace ...esp GEM. Also, if i have GEM seat only but want to trade some ES would the clearing firm still give u decent rate? thx for all the answers and help. jim
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Quote from jim c:

Quote from FuturesTrader71:

For the ES:

with IOM ($195,000) -> $0.69 per turn + up to $50 per day for Globex fees.
So this is .69 per round turn..in and out? I guess im confused with "per turn".
For both with ECM ($1000 app fee) -> $1.38 per turn all in. So with ECM its more @ 1.38 per round turn. sorry im a little thick. i can see where the best deal would be to purchace ...esp GEM. Also, if i have GEM seat only but want to trade some ES would the clearing firm still give u decent rate? thx for all the answers and help. jim
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The ECM is a temporary program available until Dec 31, 2006. You have to be trading under an LLC or Corp to get that rate. They charge $0.88 and then your clearing firm would charge a commission on top of that. Again, this is a temporary program. Another option is to lease. The lease on an IOM for the ES is $900 / month. The rates are close to member rates. Again, it all depends on how much volume you trade. The $900 per month may be peanuts given the retail rates at most brokers.
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Does anyone know about leasing just the GEM seat. I saw on the CME site that the lease is only $200 per month for this and you can trade the ER2.

Since I trade only the ER2 this would be a great starting point for me since my monthly volume is borderline.

I talked to Velocity Futures but they did not seem to know much about it. They were telling me I had to get the IOM seat for $900 per month , but I think X-trader is included in that.

If I could lease the GEM seat and get the reduced commitions this would be ideal.

Thanks for any info.
 
Quote from millydog:

Does anyone know about leasing just the GEM seat. I saw on the CME site that the lease is only $200 per month for this and you can trade the ER2.

Since I trade only the ER2 this would be a great starting point for me since my monthly volume is borderline.

I talked to Velocity Futures but they did not seem to know much about it. They were telling me I had to get the IOM seat for $900 per month , but I think X-trader is included in that.

If I could lease the GEM seat and get the reduced commitions this would be ideal.

Thanks for any info.
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Milly-
If you're an independent trader, and you only trade the ER2, then you should definitely lease yourself a GEM and find yourself another professional trading firm- (ie: Advantage Futures) Velocity doesn't know much about this because there's no money in it for them. Check out the very helpful spreadsheet at the beginning of this forum; from there, it's a simple matter of plugging in your average monthly volume to see if you would be saving any money with a GEM.
Best of luck
 
Thanks Covert

Yes my monthly volume is more than suficient, I just need to find a broker to clear through. Yes your probabbly right about Velocity. Can you recomend a broker to clear through. Advantage??, anyone else.
 
Quote from Covert:

Milly-
If you're an independent trader, and you only trade the ER2, then you should definitely lease yourself a GEM and find yourself another professional trading firm- (ie: Advantage Futures) Velocity doesn't know much about this because there's no money in it for them. Check out the very helpful spreadsheet at the beginning of this forum; from there, it's a simple matter of plugging in your average monthly volume to see if you would be saving any money with a GEM.
Best of luck
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Covert is right you should look at Advantage Futures to clear your trades if you are going to lease a membership. If you call them they will be happy to answer any of your questions. They will walk you thru the leasing process and drop off the paperwork and checks to the CME. You do not want to deal with the CME directly. Let the clearing firm do that for you.
http://www.advantagefutures.com/


You should also look at buying a GEM seat. I own my GEM seat. At the moment the offer is 27,500. Members pay .095 clearing fee. Leasees pay .21. Do the math and see if owning would be helpful.
 
Yes I am already considering purchasing the GEM seat, But my plan right now is to start by leasing the seat for a few months and then go from there.

Thanks, I will check out Advantage this week.
 
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