IB vs Thinkorwim - Options Trade Executions
- Thread starter rd100
- Start date
I trade with TOS and am a big fan of their platform. I have been thinking about switching over to IB but was afraid of their cancellation/modification fee. Is it really true that they donât charge it for spreads? I do a quite a bit of modifications when entering spreads so it would be a huge deterrent to me if they do charge a fee.
Also I have read that IB enters spreads as individual legs which I believe puts your orders lower in the Q. Does anyone know if there is any truth to that?
IB will liquidate your account at the same day when you have margin call whereas TOS gives you one day to reduce your margin or wire new fund.
When you trade with margin, it is better to use TOS because IB usually liquidate your position at the worst time.
TOS also have set-up similar to IB FF advisor. You can allocate trades among accounts, but sometimes one account gets filled whereas another account unable. They don't allocate positions after the trade. They send multiple orders to the exchange.
When you trade with margin, it is better to use TOS because IB usually liquidate your position at the worst time.
TOS also have set-up similar to IB FF advisor. You can allocate trades among accounts, but sometimes one account gets filled whereas another account unable. They don't allocate positions after the trade. They send multiple orders to the exchange.
Well I must take that back, the guy in the other thread had positions that caused the mess. I really wish I could go back and get rid of that, and let people debate tos and ib without that post. The whole 30 min thing makes it in stone. Oh well. At that time, I thought it was really important. I trade verticals, and that concerned me to no end. But it was wrong, so, I hope no one includes that post in deciding where to go.
Btw I trade at tos and couldn't be happier.
Btw I trade at tos and couldn't be happier.
They don't charge cancellation/modification fee on spreads. I change my spreads a lot and was never charged.
There is no doubt that customer service in TOS is no comparison to IB. In IB the customer service is close to non-existent. In addition, their margin requirements are much more flexible. For example, if you do double diagonal, IB will take margin from both sides, and TOS only from one side (like in iron condor).
Another example:
I had the following trade:
Buy 4 POT APR 10 125 call
Sell 8 POT APR 10 135 call
Buy 4 POT APR 10 140 call
The total debit was $1,060.
My maximum loss of this trade is the received debit - $1,060 but my margin was reduced by approximately $3,000. IB explanation was:
"Please be advised that your maximum loss from option strategy would not be only the premium if there is any short option leg involved. For the underlying POT as of 15:21:15ET, your 4 contracts of 125 APR call are currently paired up with 4 contracts of 135 APR call as a debit call spread with zero initial/ maintenance margin requirement required. Another 4 contracts of 135 APR call are paired up with 4 contracts of 140 call as a credit call spread with USD 2000 initial/ maintenance margin requirement required."
This explanation shows complete lack of understanding of options. The margin requirement should never ve more than the maximum risk. Their answer to this was:
"The margin requirements on option positions depend on how our system pairs up the legs at this time. Please note that Interactive Brokers utilizes option margin optimization software to try to create the minimum margin requirement. However, due to the system requirements required to determine the optimal solution, we cannot always guarantee the optimal combination in all cases. It is important to note that system cannot run through an unlimited amount of permutations to always ensure best possible combinations. As I explained, system is currently pairing up your POT options as two call spreads, therefore USD 2000 margin requirement is enforced."
However, my savings from commissions are too big, so I continue suffering from their customer service.