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Options House is now junk!!
- Thread starter TM1982
- Start date
Quote from heiasafari:
The problem is this: When you are the ONLY ones out there that offer flat rate, well then you can be sure that you are going to attract every single big volume retail traders around... That means that your average trade size is going to be considerably bigger than your competitors and you just won't have enough small size lots (that are profitable) to cover for these big boys.
I know if I had access to a fixed rate broker I would have raped them, even if their system/platform is not the best considering the number of lots I trade... I agree that their model was flawed from the get-go, just look at those vultures at CBOE and see the fees they charge per contracts.
http://www.cboe.com/publish/feeschedule/CBOEFeeSchedule.pdf
And the first thing you'll see in that quote is that there is no fee on equity options. This has been pointed out by the OH CEO in interviews and discussed in threads here.
Quote from shannonpaul:
In fact if you�re looking to trade a single leg order with 1,000 contracts, it will cost $700 with Interactive Brokers and just $158.50 with OptionsHouse $8.50 +.15 rate.
Just curious, how many people trade 1000+ lot? Also if you do 100K+ per month volume, IB offers you .15 per contract flat. So you are still $8.50 costlier than IB.
So far my strategy was following; if I can afford 20+ contract per order (usually spread, so 10+ spread) I go OH. For smaller orders IB was my choice (usually multiple orders, 2 contracts each on some high priced stocks). Per contract pricing with no fixed cost is great for scale-in and scale-out.
So guess I'm out :-( My 2 cents:- Don't lose your edge else you'll lose your business.
Why can't you match eOption.com? $3 + .10 per contract. Equity trades are 2.95; so just make .10 or .15 per contract on top of that.
Quote from shannonpaul:
In fact if youâre looking to trade a single leg order with 1,000 contracts, it will cost $700 with Interactive Brokers and just $158.50 with OptionsHouse $8.50 +.15 rate.
In other words, "Using this particular example, you will now pay 16 times the former commission rate or a 1500% increase."
What about the closing transaction? That will be costly as well.
What about clients who trade 4000 contract positions? A $1200+ commission versus the former $20.
How can you possibly try to spin this as something beneficial for your clients?
AZD
Quote from SForce:
And the first thing you'll see in that quote is that there is no fee on equity options. This has been pointed out by the OH CEO in interviews and discussed in threads here.
BS... If you actually can find somewhere in the document or the cboe's website what is the definition of "customer", well 1) i'd be very happy to know and 2) you'd be my hero
Untill I see this definition, OH is either a market-maker. a member firm or a broker-dealer in my book so they do pay per contract
Quote from shannonpaul:
In fact if youâre looking to trade a single leg order with 1,000 contracts, it will cost $700 with Interactive Brokers and just $158.50 with OptionsHouse $8.50 +.15 rate.
Quote from
arizonadreamer:
In other words, "Using this particular example, you will now pay 16 times the former commission rate or a 1500% increase."
1500% commission jack up applies to me .. i trade 4 digit lots .. came to OH after ditching top 3 brokers that I had accounts with . .. well no point staying with OH now
Quote from key88sf:
Actually what they should do is keep the flat-rate for LESS than 1000 contracts. If they are stuck only with professional guys, hit them with the new rate for more than 1k contracts.
Guys like me who are just regular traders are getting screwed by this.
This. Or something like this that allows existing customers to keep the old rate (or something real similar) and makes everyone happy. I'm sure there's some middle ground..