IB commissions for low priced stocks
- Thread starter Bitstream
- Start date
IB is great if you aren't trading many shares, but as my account grew, I was paying more and more commission since I had the ability to trade more shares. I don't trade enough volume to get any special treatment, so I just moved almost all of my account back to Ameritrade to take advantage of the flat commission. If I go back to trading more options, I'll move back to IB, but for stocks, their commission is below average unless you're trading Google or something. Also, AMTD gives you more overnight leverage.
ib would become the most competitive broker of 'em all--hands down--if they lowered their commies for stocks under $10...no question. dunno how many on this board trade low priced issues but since they are very attractive alternatives to the usual suspects, i think volumes would jump up considerably.
But this is not a direct-access firm.
Normally, none of things are a factor for the way I trade, and yes I trade well over 2000 shares at a time. I'll see how it works out. I already have an account with AMTD, so it's not like it was tough to move the money. If it ends up being more expensive, then I'll move back. I don't see why anytime anyone questions whether IB is best for them, some people feel the need to attack. It's a matter of trying to minimize costs while still getting acceptable service. IB has done a couple other things that have annoyed me recently, so I'm not in love with them like some people on here.
Is there any direct-access firm that has a fixed price for limit orders?
I don't see how there could be. The only way a fixed price can work is if a firm accepts payment for order flow from a market-maker for sending them the order. If you send a marketable order for an ETF or NASDAQ stock to an ECN, like INET or ARCA, the broker pays $0.003/share to take liquidity. That's $30 on a 10K share order. He obviously can't charge you only $10, unless most of his customers have much smaller orders, and you ride for free on their backs.
Look very carefully at the footnotes on a lot of the supposed "flat-fee" brokers - there are often add-on charges depending on routing and other things.
I don't see how there could be. The only way a fixed price can work is if a firm accepts payment for order flow from a market-maker for sending them the order. If you send a marketable order for an ETF or NASDAQ stock to an ECN, like INET or ARCA, the broker pays $0.003/share to take liquidity. That's $30 on a 10K share order. He obviously can't charge you only $10, unless most of his customers have much smaller orders, and you ride for free on their backs.
Look very carefully at the footnotes on a lot of the supposed "flat-fee" brokers - there are often add-on charges depending on routing and other things.
Have anyone considered IB's unbundled plans (for US shares)?
The plan is complex to me. I can't figure in what situations I should join this plan.
Here's a few things I notice:
- if you are a trader who will queue your orders and wait for execution (ie using non-marketable limit orders to trade), you can even buy/sell shares with money received[?]
- but if you take the orders, will the commissions + other fees be lower than that of bundled plans?
<=300,000 Shares--------------- $0.0035
300,001-3,000,000 Shares------- $0.002
3,000,001-20,000,000 Shares---- $0.0015
>20,000,000 Shares------------- $0.001
The plan is complex to me. I can't figure in what situations I should join this plan.
Here's a few things I notice:
- if you are a trader who will queue your orders and wait for execution (ie using non-marketable limit orders to trade), you can even buy/sell shares with money received[?]
- but if you take the orders, will the commissions + other fees be lower than that of bundled plans?
<=300,000 Shares--------------- $0.0035
300,001-3,000,000 Shares------- $0.002
3,000,001-20,000,000 Shares---- $0.0015
>20,000,000 Shares------------- $0.001