Some newbie questions about Ninjatrader Brokerage

[nicbizz]

So, I've been using their platform (lifetime license) for years with another broker.

I recently took at look at their Brokerage offerings, and it looks like they clear through either Phillips or Dorman. I'm guessing in this case, NT Brokerage is the FCM?

Things get even messier at the next step, since there are three further options I have to choose from: CQG, Continuum or Rithmic.

1) What are those 3 options? Are they purely data providers, or do they do brokerage-y things like order matching, etc?

2) For some reason, Rithmic seems to cost more (in both commissions and monthly fees), though I have no idea why or what I'm getting in return. I only brought up Rithmic because its something I recognize from my other broker. If anyone has any pros and cons to share here, that'd be great.

3) Where are my funds ultimately held? In other words, which of the above have to go bust before my funds are affected?

I know these questions might seem peculiar for someone who has been in the markets for more than a decade, but I honestly never really bothered much about brokers and just stuck with what I knew. If my current broker hasn't decided to change some of their policies, I would have continued to remain blissfully ignorant (and probably overpaying in commissions!). So any insights here would be very much appreciated.

 

[xandman]

1) Understand the parts that make up the Futures market which is different from the stock market.

Introducing Broker (IB) - NT
Futures Commissions Merchant (FCM) - Phillips/Dorman
Data and Routing (almost always together) - CQG/Continuum/Rithmic
Order Matching - The Exchange where the product is traded.

2) Some are in the opinion that Rithmic data and routing is very fast and has fewer hiccups. There are probably many other factors that I am not aware of.

3) FCM holds the funds because they handle Margin and Clearing/Settlements.. IBs and FCMs have a retail/wholesale relationship. But, don't expect a better rate just because you went straight to an FCM. IBs often play an important role in negotiating better rates and free platforms for smaller traders who may not be served by some larger FCMs.

No worries. I am in the opinion that the best brokerage deals are still made by meeting people and making calls. But, you need to have a verifiable record of doing volume. Promises won't cut it. In any case, you are at rock bottom pricing with your Lifetime license at NT. What remains is for you to judge the customers tools and services.

 

[JSOP]

So, I've been using their platform (lifetime license) for years with another broker.

I recently took at look at their Brokerage offerings, and it looks like they clear through either Phillips or Dorman. I'm guessing in this case, NT Brokerage is the FCM?

Things get even messier at the next step, since there are three further options I have to choose from: CQG, Continuum or Rithmic.

1) What are those 3 options? Are they purely data providers, or do they do brokerage-y things like order matching, etc?

They are pure data providers. They do NOT do any order matching or offer any brokerage services.

2) For some reason, Rithmic seems to cost more (in both commissions and monthly fees), though I have no idea why or what I'm getting in return. I only brought up Rithmic because its something I recognize from my other broker. If anyone has any pros and cons to share here, that'd be great.

Rithmic's data is supposedly more superior than the other two. It is faster and it is less error prone. And it is also less prone to glitches or data spikes, so I have heard.

3) Where are my funds ultimately held? In other words, which of the above have to go bust before my funds are affected?

Your funds are ultimately held at either Philips or Dorman depending on what you trade. I believe one is for futures and the other one is not. I forgot which one is which. You will have to confirm with Ninja if you ultimately want to choose Ninja as the broker. And yes, Ninja Trader brokerage is just an what is called introducing broker. Philips or Dorman where your funds will be ultimately held is the clearing corporation where they do all the order matching and settlement of all your trades, your real broker.

I know these questions might seem peculiar for someone who has been in the markets for more than a decade, but I honestly never really bothered much about brokers and just stuck with what I knew. If my current broker hasn't decided to change some of their policies, I would have continued to remain blissfully ignorant (and probably overpaying in commissions!). So any insights here would be very much appreciated.

No problem at all. Glad we can help and hope we did.

 

[nicbizz]

That helped alot, thanks guys!