Slippage & Stops & IdealPro

[granville]

I've been building a database off of IdealPro's API and today had a buy stop get filled with 3 pips of slippage (on GBPUSD).

I looked at the database and found that the inside ask hit my trigger price five times before my order was filled on the sixth and almost 5 and 1/2 seconds after the trigger was hit that last time.

How are stops handled on IdealPro? Are they usually this delayed? Is a trigger price hit when an inside bid/ask hits or passes them? I will call IB on Monday to try and figure this out.

Any help before then would be appreciated.

 

[granville]

Anyone?

 

[granville]

I found this in IB's website:

"Buy Simulated Stop Orders become market orders when the last traded price is greater than or equal to the stop price."

So if volume is thin on IdealPro (few or no trades take place), could a stop never be triggered even though the market passes waaaaay beyond it?

 

[ballyhoo]

Quote from granville:

I found this in IB's website:

"Buy Simulated Stop Orders become market orders when the last traded price is greater than or equal to the stop price."

So if volume is thin on IdealPro (few or no trades take place), could a stop never be triggered even though the market passes waaaaay beyond it?

Read in this forum and in other forums, always the same complaints about slippage and bad performance with Interactive Brokers IdealPro. Change the Broker, then you will be happy.

 

[Kevin Schmit]

Quote from granville:

How are stops handled on IdealPro? ... Is a trigger
price hit when an inside bid/ask hits or passes them?

In IdealPro a buy stop is triggered on the inside bid.
A sell stop is triggered on the inside ask. Since a buy
stop will be filled on the ask, you have to place it lower
by a few pips than where you want to be filled.

That said, I don't recommend trading spot Forex on
IdealPro. Trade the CME forex futures instead (you'll
get much better executions) or trade on a real Forex
ECN, not on IB's in-house interest-conflicted one.


.

 

[ballyhoo]

Quote from Kevin Schmit:

In IdealPro a buy stop is triggered on the inside bid.
A sell stop is triggered on the inside ask. Since a buy
stop will be filled on the ask, you have to place it lower
by a few pips than where you want to be filled.

That said, I don't recommend trading spot Forex on
IdealPro. Trade the CME forex futures instead (you'll
get much better executions) or trade on a real Forex
ECN, not on IB's in-house interest-conflicted one.


.

well said Kevin

 

[ddunbar]

Quote from granville:

I found this in IB's website:

"Buy Simulated Stop Orders become market orders when the last traded price is greater than or equal to the stop price."

So if volume is thin on IdealPro (few or no trades take place), could a stop never be triggered even though the market passes waaaaay beyond it?

For Idealpro, there is no last price. So you have to methods available.

In TWS under configure, order defaults, find the cash underyling you're looking to trade. For example, EUR.USD. Select EUR. You'll see a trigger method pull down menu. It should be set to default.

Default is double bid/ask. Meaning, for a BUY, two consecutive ask prices must be equal to or greater than stop.

You can change this to BID/ASK. In which case only a single ask that is greater than or equal to stop is required.

WARNING: if you use that method, you stand the risk of having your order executed on a single errant quote(which happens rarely) or a split second widening of the bid/ask due to a momentary loss of liquidity (which happens often enough to worry about it.)

My recommendation: USe stop limit orders for entry except set the difference between your stop and limit 2 pips from each other. I'd also recommend leaving the double bid/ask or setting it as such just to make certain that default is not single bid/ask.

Example entry order: BUY EUR.USD 1.2700 limit, 1.2698 stop. You'll receive an execution anywhere in between but usually at 1 pip above stop if not the limit. Exceedingly rare to get the stop's price.

During volatile times (eg news event) set stop 3 to 4 pips from limit.

This is how you control slippage. In essence you're factoring it in and putting a cap on it.

 

[ddunbar]

Quote from Kevin Schmit:

That said, I don't recommend trading spot Forex on
IdealPro.

Depending on one's trading style, I don't recommend it either.

Trade the CME forex futures instead (you'll
get much better executions)

I don't recommend this during news or with size during news events.

or trade on a real Forex
ECN, not on IB's in-house interest-conflicted one.

There aren't many "real" ECNS that are accessable to retail traders given the minimum volume requirements. IB is pretty much as close to a real ECN as you can get retail. But even with a real ECN, your stops will have slippage. Especially during news events. Not one of them is immune to it. It's the banks who control pricing. ECNs merely display BBO and pass the order onto the bank with the BBO.

As far as IB's in-house interest -conflict... what are you refering to exactly? The fact that IDeal pro also matches orders between customers? How is that a conflict? Do you know what banks act as IB's liquidity providers? No conflict there. Please detail the conflict of interest. Thanks.