New IB option commission rates

F

freehouse

For US options:

$1.95 per contract if the option premium is over $0.25

$1 per contract if the option premium is between $0.10 to $0.25

$0.50 per contract if the option premium is between $0.05 to $0.09

$0.25 per contract is the option premium is less than $0.05


I am assuming that these commission rates are for options traded on the CBOE, AMEX, Philly, P-Coast, or ISE option markets (not options on futures).
 
Every day I expect to get an email from IB saying the party is over and we are going to have to start paying big $$$ to trade. Yet every email
I get from IB seems to be a note saying they are slashing prices.

Wow.

The only exception was the adding of the $10 quotes fee.
And speaking of that, I checked the status on both my accounts and I am most definately substribed. However, I can't seem to get a NASDAQ
line to come up anymore. (NYSE, AMEX, etc... all show fine) Anyone else have this problem?
 
Originally posted by freehouse
For US options:

$1.95 per contract if the option premium is over $0.25

$1 per contract if the option premium is between $0.10 to $0.25

$0.50 per contract if the option premium is between $0.05 to $0.09

$0.25 per contract is the option premium is less than $0.05


I am assuming that these commission rates are for options traded on the CBOE, AMEX, Philly, P-Coast, or ISE option markets (not options on futures).
More...

emini futures options are $3.95 per ccontract.
 
At first glance I'm shocked by IB's new lower options commission rates. But, wait one minute! Let's zoom in and I conclude that (at least to myself) this is the LEAST significant price slash IB ever announced.

Hey! Even the deep OTM options with 10 days to expire trade above .25.

My tentative options commission rates:

Minimum is $5.00

$1.50 per contract if the option premium is over $2.50

$1.25 per contract if the option premium is between $1.25 to $2.49

$1.00 per contract if the option premium is between $0.50 to $1.24

$0.50 per contract is the option premium is less than $0.50

Or a symplified (and more reasonable and preferred) one:

*Any minimum not exceeding $7.50 is ok.

$1.50 per contract if the option premium is over $2.50

$1.25 per contract if the option premium is between $0.75 to $2.50

$1.00 per contract if the option premium is less than $0.75

Personal opinion out of my own prudent reasoning. NOT INTEND TO OFFEND ANYBODY.
 
I got that email about the party being over today. Actually, I didn't get the email. IB froze my corporate account. After a long time on hold with IB help, it turns out all of the corporate accounts were held up. It seems they are forcing all corporate accounts to pay professional fees, even if the corporation has nothing to do with the securities industry. No notice, no email, no explanation. The rep told me, "In order to begin trading again, you will need to subscribe as a professional and pay the professional fees, about $300". I talked to a supervisor and he verified that this was true. It was effective today.

I wrote IB mgmt and haven't heard back yet. I also wrote the SEC to get their interpretation of a "professional". By IB's own former definition, it was basically a licensee or other party commingling or in the securites biz. Now, they will only tell me verbally that a "professional" is anything other than an individual. They really pulled the rug out from under me on this one. If IB has the discretion to change their definition of a "professional", what's next? Individuals carrying a certain balance? I'll wait to hear from the SEC. IB handled this very poorly. I am very disappointed in the way they handled this. The $300 is scratch, I just wish they would have emailed me or something...very unprofessional.
 
option fees: the new fees are to support cabinet trades which require a low commission. for reasons such as margining, some traders prefer to close out cheap option positoins. per their request, the new fees were implemented.

ktm, agree that things could have been done better. i'll let you know if I hear anytihng
 
As always...Thanks Def.

I am one who closes out cheap options - usually in order to write a more expensive one prior to expiry (and I don't wish to be uncovered).

Thanks Def
 
Well, maybe the new fees are not so much insignificant. Welcome that some fellow traders benefit from it.

But since IB already breaks the single 1.95 rate, how about re-evaluating the complete options fee structure to implement a real significant one?

As The Knight put it, "We started out paying the same rate as you and had it dropped to .75/ct. Still expensive".

Centeing on the $1~1.25/ct level with $2.5~7.5 minimum for the retail clients. Really competitive and attractive. And I don't think it will hurt IB's revenue, esp. when IB no longer has to absorb the market data fees.

Def, push it, pls.
 
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