Direct Globex connection

[Joe D]

Cooltrader,

Yes the saving is from eliminating the middleman - the IB. That's what I meant by saying "directly through an FCM".

Front running is one possiblity (I think I read that Interactive Brokers were fined recently for doing something like this).
Technical problems in your broker's system is another.
So there are additonal risks - but my question was: "Where's the advantage?" If the cost is the same, then.........???

OK my mistake - I understand now - Yes - if you trade more than 10 r/t's per day, the money saved should be more than the $400/month fixed cost.

 

[Joe D]

Originally posted by PuffyGums
Lets give you 5 millisecond for faster turnaround and 15 millisecond for the retail broker's latency. In a market as deep the the emini that 20 milliseconds is giving you what exactly?

You presuppose that I accept your assumed times which have vacillated from 5 to 70 - my testing and your uninformed guesses show that you have no idea how bad the delay is at times.

 

[Joe D]

Originally posted by PuffyGums

Ugh! The CME IS doing exactly what your broker would do if you used one of the products that the broker hosts. Nothing is being saved. No hops are being skipped.

You just don't get it do you?

Do you think the CME simply accepts your broker's validation and allows your trade to enter Globex without it clearing the trade itself ???

It goes through the very same process that my trade encounters -but my trade did not have to go to your broker's machine and your broker's ADDITIONAL validation first.

 

[PuffyGums]

Originally posted by Joe D


You just don't get it do you?

Do you think the CME simply accepts your broker's validation and allows your trade to enter Globex without it clearing the trade itself ???

It goes through the very same process that my trade encounters -but my trade did not have to go to your broker's machine and your broker's ADDITIONAL validation first.

I certainly do get it. The additional broker's machine you are worried about still exists but it is being run by the CME rather than the broker. The fact that the CME also runs GLOBEX doesn't mean that a step is being saved. The broker hosted trading system and the CME hosted trading system are functionally equivalent.

 

[Joe D]

Originally posted by PuffyGums

I certainly do get it. The additional broker's machine you are worried about still exists but it is being run by the CME rather than the broker. The fact that the CME also runs GLOBEX doesn't mean that a step is being saved. The broker hosted trading system and the CME hosted trading system are functionally equivalent.

The CME only vaildates once - it does so for trades regardless of whether they came in direct or via a broker and that validation process is the same for all trades.

The journey to your broker and the validation perfomed there is 'extra'.

 

[PuffyGums]

Originally posted by Joe D


You presuppose that I accept your assumed times which have vacillated from 5 to 70 - my testing and your uninformed guesses show that you have no idea how bad the delay is at times.

Read first, then comment. The 5 millisecond referred to potential savings in broker server turnaround. The 70 milliseconds refers to internet latency. I've done traceroutes, pings, taken measurements on my end, examined broker server logs.

 

[PuffyGums]

Originally posted by Joe D


The CME only vaildates once - it does so for trades regardless of whether they came in direct or via a broker and that validation process is the same for all trades.

The journey to your broker and the validation perfomed there is 'extra'.

The CME runs GLOBEX. It also runs a trading platform which it offers to retail traders. As the host of a trading platform, the CME completes all the functional steps that your broker does. There is no super direct access. The broker's orders are hitting the GLOBEX API directly. Your orders to the CME's trading platform are not doing that. You are talking to a trading platform server (much like the brokers server) and that server is in turn passing the order to GLOBEX.

 

[CoolTrader]

PuffyGum, I saw your point. The thread should be renamed as "Trade on Globex directly through CME".

 

[Joe D]

Originally posted by PuffyGums
The CME runs GLOBEX. It also runs a trading platform which it offers to retail traders. As the host of a trading platform, the CME completes all the functional steps that your broker does. There is no super direct access. The broker's orders are hitting the GLOBEX API directly. Your orders to the CME's trading platform are not doing that. You are talking to a trading platform server (much like the brokers server) and that server is in turn passing the order to GLOBEX.

Your broker's order is not routed directly to the book (the CTE, Central Trading Engine). It is routed to the SLE which serves as the gateway for ALL orders.

The Interface Control Layer for GL/Trade is at the SLE level and performs the permissioning and Credit Control functions. This process is also performed for your trades.

My orders go here directly but yours get here indirectly - via your broker's system.

Once here, the path both orders take is the same.

 

[redzuk]

Originally posted by Joe D

I should add that my FCM also offers TT and, more recently GL/Trade.

CME offers 2 choices;
1. $200 for order entry software only, plus direct line
2. $400 includes order entry software, and vpn.

The GL/Trade you mentioned is a third option? And if using the above $400 package do you get access to the GCC desk?

Do you mind saying who your FCM is? Anybody have a screen shot of the cme platform.