IB Data costs for Partnership - TOS/OptionHouse?

C

Coderblix

I have setup a general partnership to trade through per my CPAs advice (has a lot to do with my W2 job and taxes...). I currently trade Calls/Puts/simple spreads through Schwab streetsmart and Jpmorgan (online and through advisor) and want to move. Streetsmart just isnt doing it for me and Jpmorgan bleeds me dry on comms and delayed trades. I trade frequently (~100K dollars last quarter). I have been trading options for 4 years and am profitible but not overaly sophisticated yet (i.e. the calls/puts and simple spreads) as I do have a day job.

Question is, with IB, I need to open a pro account (due to partnership) and am overwhelmed by all of the data choices and their costs. I have no idea what I need data wise (have always just used what Schwab provided through streetsmart). Do I need any of the subscribed feeds to get the realtime quotes and data I received through streetsmart? Should I be looking at TOS or OptionHouse for my style/level of trading? I plan to incorporate some more "advanced" trades as I progress but am working my way into understanding them. Any advice will be greatly appreciated!!!!
 
If you need the live data to show up in your IB option trader you will need to pay their professional data fee. But you can also check the live data elsewhere and trade through IB, where you should see 15mns delayed data.
 
Quote from luisHK:

If you need the live data to show up in your IB option trader you will need to pay their professional data fee. But you can also check the live data elsewhere and trade through IB, where you should see 15mns delayed data.
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Would I need to do the same thing with TOS or OptionHouse? Or do they provide the live data for free?

Anyone familiar with what data feeds at IB would be equivalent to the one data I am getting from Schwab on the Streetsmart platform?
 
Quote from luisHK:

If you need the live data to show up in your IB option trader you will need to pay their professional data fee. But you can also check the live data elsewhere and trade through IB, where you should see 15mns delayed data.
More...

Holy smoke...I just did a quick compare on the data. To meet the "free" data individual traders get I would need the following:
AMEX - $30.20/month
NASDAQ Level I - $25/month
NYSE Level I - $127.25/month

I found a reference on the Schwab site to NASDAQ total view - which on the IB site is another $76/month.

Really struggling with this...why would anyone pay $258/month for the data at my level of trading?

Looking at the pricing- I traded 1022 contracts in August - average trade was about 31. With the IB Smartroute orders the fees on a 31 contract order would be about $15. Am I seeing this correctly? Is that the fee for prof as well as individual? I am paying about $25 average currently with some larger trades costing more. So if I do 33 trades a month on average with an average commision from IB of $15 that would be about $495/month in comm. With my current setup I would be at 33 trades a month with an average comm of $25 so $825/month. But no data fees.

So...if this logic is correct it would be on average $495 + $258 per month for IB so $758

And current is $825

Am I reading this correctly? Sorry...just trying to make sure I understand this before making any changes...
 
If you are trading through an entity (as you are with your partnership) you are by default a "professional subscriber", and as such you must pay for data. This is an exchange rule. It does not matter who your broker is. The reason you never paid for anything at Schwab is because you were trading as an individual which is considered a "non-professional", and that group gets data for free. All you need is the standard NYSE/AMEX/Nasdaq package which is $182/month.
 
You don’t have to pay pro fees if the entity was set up solely to manage your own personal money.
As long as you are not doing anything in a pro manner, or holding yourself out as a business, but just using an entity to trade your own money then you can be viewed as a family partnership and don’t have to pay pro fees.
 
family office wont avoid the fees... doesnt work that way... and having a SMLLC investing own money makes no change on being categorized as a non-pro... if you are a legal entity, you are a pro... period....

lastly, I dont get it why people complain so much about market data... first, it will be a deduction... second, if you are making $20K+ ROI per month, the MDS is just the cost of doing business... and btw, all brokers will be the same... and lastly, NYSE bills directly... so the broker wont be billing you for that piece...
 
^I should have mentioned that it is broker specific. Some will allow a husband and wife partnership to avoid all pro fees, while some brokers don’t want to bother with giving you the exemption even though they can.

“Non-Commercial Organizational Use:
NASDAQ's definition of non-professional subscriber permits individuals associated with certain non-commercial organizations (i.e., family investment trusts, investment clubs, etc.) to access NASDAQ market data at non-professional rates. Please note that the organization itself cannot be considered a non-professional subscriber, nor can any professional staff paid to support the organization’s activities (i.e., attorneys, accountants, administrative staff, etc.)

NASDAQ’s definition also permits individual subscribers associated with other organizations to access non-professional rates if the organization is established exclusively to manage accounts of the individual or the individual’s immediate family. In addition, non-commercial organizations solely owned by an individual and members of their immediate family (who themselves are non-professionals) utilizing the market data solely for their own personal investing may access data at non-professional rates.

To obtain the reduced non-professional rates for qualifying subscribers associated with non-commercial organizations, distributors are required to administer and maintain a separate NASDAQ Subscriber Agreement for each individual subscriber accessing NASDAQ data.”
 
Quote from opt789:

Please note that the organization itself cannot be considered a non-professional subscriber....
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an org is a pro, period... the rest of the things you quoted have to do with individually titled accounts, not LLC titled accounts...

in the case of the OP, he will be an LLC... I know as I have the same setup..

lastly, NASDAQ is a single market... they dont all follow similar rules.. the majority rules are simple... legal entity = pro...
 
Feel free to post all the incorrect info you would like, that is what this whole website is for right?
I know for a fact that there are brokers that don’t charge pro fees for family partnerships.
 
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