IB commission fee vs standard pricing.

FWIW, I took the total number of US equity contracts I traded in May and divided by the total commissions for US equity contracts (IB breaks down commissions/fees by asset class, so was easy to do). Granted there are going to be differences affected by things such as some options I allowed to expire worthless, some I closed at <= $0.05 (IB charges no commission for these), and I've had trades where my exchange rebates are greater than my commissions, so keep that in mind. In any case, my average per contract cost was basically $0.50/contract. I don't do massive volume either. I'm on IB's $0.70/contract commission schedule (their lowest volume tier), so I must be getting rebates on a good chunk of my trades.

I'm assuming the other posters were primarily focused on stock rather than stock options, but figured my real world IB data might be useful to someone.
 
JSOP said:
Hence the SMART routing would not get you the lowest commissions and if you want the lowest commissions, you need to use direct routing.



EXACTLY what I said 3 posts earlier. And my personal experience really confirms this too.

Conclusion: IB's commission is not the most competitive, lowest among all discount brokers, at least not anymore. And this is before any other fees that IB chooses to charge like inactive account fee, exposure fee and etc.
More...

Thank you for all the information.
 
i read too much inexact things in this post.
first, tired comission is better than all...
never use direct rotuing as they ouver charge you if you dont let them the possibility to take your order for them internally using SMART. they fuck us as they prevent us to direct our flow where we wish.

on the other hand, if you trade alot fees becomes almost acceptable that is 0.0025 without rebate.

i have tuned smart to lower fees and i see since that it send a maximum order number now to PSX instead of ISLAND previously. i can say that i saw a decrease in fees.

but anyway anyway anyway IB f... all of us, beleive me, i trade moore than 70k shares a day, and finding 0.001/0,0015 cents per share as proposed by big names like BAC, UBS or GS is difficult with a second class brokers...

big banks today doesnt only recquire that you trade big volume, they dont care, they want a big account for collateral....
 
If the lowest commissions is all you care about, use Robinhood which has zero commission. The truth is that without access to auctions, algo trading, etc you are almost guaranteed to end up paying more overall to execute. You have to remember that commissions are just one factor in the cost of trade.

As for flat rate brokers, trading 1000s of shares in a single order is only efficient in some limited contexts like at the auctions (as others have mentioned) the most liquid stocks, or penny stocks.. if this is your strategy then great. But in general IB's fee schedule is more flexible and will be cheaper for a lot of strategies. Combined with their margin rates, universal account, etc, IB has always come out on top for me whenever I do the math.
 
arbitech said:
never use direct rotuing as they ouver charge you if you dont let them the possibility to take your order for them internally using SMART.
More...
I'm new to IB so jut getting familiar with it. One thing that I don't like about SMART route is when I send a market(able) buy order on a stock with large spread, it executes in their dark pool at the offer. If I sent it direct, I may have been improved by hidden orders. Isn't there a way to customize the SMART route to exclude certain destinations? I can do more research but just wanted to see if people could share their routing preferences for TAKING liquidity.
 
for large spread use IEX you usually get unbelievable exec price improvment. but ib prevent us to send business to iex they charge you crazy fees if direct route.
that why i say ib f... us.

on the other hand you have some ecn whch pay you rebate for Taking liquidity.

taking liquidity if you are big make the price jump above all if large spread stock....

usually if you are executed IBDARK that means that you have paid almost zero fees because ib want you order because you are on the wrong side (90%cases): they adverse selected you.

they claim to not ressell our flow....ibdark is for internal matching...but why then 90% time in wrong side....

you cannot do what you say with ib smart...

the worst exec experience i have is with NYSE, very expenssive and a lot of adv selection...

currently i am develloping my own SOR to track hidden liquidity...
 
cruisecontrol said:
If the lowest commissions is all you care about, use Robinhood which has zero commission. The truth is that without access to auctions, algo trading, etc you are almost guaranteed to end up paying more overall to execute. You have to remember that commissions are just one factor in the cost of trade.

As for flat rate brokers, trading 1000s of shares in a single order is only efficient in some limited contexts like at the auctions (as others have mentioned) the most liquid stocks, or penny stocks.. if this is your strategy then great. But in general IB's fee schedule is more flexible and will be cheaper for a lot of strategies. Combined with their margin rates, universal account, etc, IB has always come out on top for me whenever I do the math.
More...


thx for your kind reply but i forgot to tell that i am colocated to equnix and i am around 1 ms from my data provider....as you can figure out, all is automated... robinhood is manual.

above all for market neutral business i dont find ib margin exceptionnal
 
qlai said:
I'm new to IB so jut getting familiar with it. One thing that I don't like about SMART route is when I send a market(able) buy order on a stock with large spread, it executes in their dark pool at the offer. If I sent it direct, I may have been improved by hidden orders.
More...

I don't have much experience with this but I'm curious. How likely is it that there are hidden orders inside the spread and why would anyone be placing such orders? What is the point if the internalizing brokers are allowed to steal all your fills?

Seems to me like market orders don't make much sense for large spread stocks unless you need to get in or out super urgently. What about putting in a limit order at the midpoint or at 3/4 of the spread depending on how aggressive you are.

arbitech said:
thx for your kind reply but i forgot to tell that i am colocated to equnix and i am around 1 ms from my data provider....as you can figure out, all is automated... robinhood is manual.

above all for market neutral business i dont find ib margin exceptionnal
More...

I was replying to the OP actually, sorry if that was unclear.

by margin rates I meant the interest rate, not margin requirement.
 
Is there any service that let's you:
Take the list of all your trades for the last month/year.
Run it through a 'simulator' to deduce what the fees would be for various brokerage firms?

At least, IB's Standard vs. Tiered? Or compare to other brokers?
 
You must log in or register to reply here.
Back
Top