Lowest Price Commission and Highest ECN rebate?

[JesseJamesFinn]

I found another Broker for stock trading, they asked me to write a proposal, what should I request? Who is providing the highest rebates because each Firm is giving me a different story, when they write and say "ARCA is $.0019, BATS $.0016 and EDGX is $.002" they are not providing me with a accurate story.


With IB, do they make you wait until the end of the Month to get your ECN rebates or is it credited to your account once you make the trade? Who do you trust and what is the highest rebates and lowest per-share or set-commission you get?

 

[MoreLeverage]

IB rebates are credited at the time of the trade, not end of month. However, they aren't passing through the actual exchange rebate, which depends on the brokerage level volume hitting various rebate tiers and are generally paid monthly. If you were at a place that was giving you their full, actual rebates passed through, you should expect to get paid those monthly and also expect those to vary based on the level of trading by both you and the brokerage's other big customers.

https://www.interactivebrokers.com/en/index.php?f=commission&p=stocks1

IB’s Cost Plus commission models are not guaranteed to be a direct pass-through of exchange and third-party fees and rebates. Costs passed on to customers in IB’s Cost Plus commission schedule may be greater than the costs paid by IB to the relevant exchange, regulator, clearinghouse or third party. For example, IB may receive volume discounts that are not passed on to customers. Likewise, rebates passed on to customers by IB may be less than the rebates IB receives from the relevant market.

 

[1245]

I found another Broker for stock trading, they asked me to write a proposal, what should I request? Who is providing the highest rebates because each Firm is giving me a different story, when they write and say "ARCA is $.0019, BATS $.0016 and EDGX is $.002" they are not providing me with a accurate story.


With IB, do they make you wait until the end of the Month to get your ECN rebates or is it credited to your account once you make the trade? Who do you trust and what is the highest rebates and lowest per-share or set-commission you get?

The rebates offered by brokers is dependant on their DMA routes to the exchange and your relationship with your broker. It is very typical for institutional brokers to offer a flat rate maker/taker rate that mimics the worst rate offered at the ECNs because it is easier to implement and offers more revenue to the broker. To get better treatment, you need high volume. To get the best rebates, you need very high volume for them to give up the extra revenue and do the work involved to calculate your rebates and fees. As for why you are hit with this after month end, that makes sense because the brokers routes will bill your broker after month end. They don't get confirmation of fees until then. And, it's often provided by broker, not at the account level. So, you broker needs to do so work to calculate your rebates and fees.

Send me a PM with your contact information if you need more clarity.

1245