TWS with IB Discussion

[tommcginnis]

JSOP, IB markets itself as a DMA.
Should they *not* provide *direct* market access, it should make quite a splash.
I've not seen anything close to a ripple.

 

[eastern_warrior]

So you are still perpetuating the myth that IB does not receive PFOF? You've been corrected on this issue previously.

IB's own 606 acknowledges payments as high as .22 received from routing orders to venues such as Jane Street Execution Services.

https://www.interactivebrokers.com/download/4Q_2017_IB_ORDER_ROUTING_REPORT.pdf

I certainly read that differently and I'll quote because you conveniently left off what they say about best-ex, provide lower commissions if your order goes to dark (splitting the difference) and you forgot to mention they sold timber hill to two sigma. If they were intent on what you say, then more than 4.4% of the orders would go to their ATS for NYSE orders. The key to best ex which many of you miss is IB will route to one exchange and re-route to others if they can get a fill. The firms buying the flow don't need to do this (and pretty much don't) as that is when they can trade against or lean against your order.

From the 606 report. Note selling and receiving payment for getting best ex and paying back a piece of that to the clients is not the same animal.

6. Payment for Orders, Dark Pools, Liquidity Provider and Affiliate Relationships:

Interactive Brokers does not sell its order flow to another broker to handle and route. Through its SmartRouting system, IB evaluates each individual order and determines the best execution venue(s), from the perspective of the customer, where that order may be executed.

A. Dark Pool and ATS Executions for Stock and ETF Orders: IB maintains connections to “dark pool” ATS’s (including the IB ATS) that execute a portion of IB customer stock orders. IB customers benefit from IB’s access to dark pools, which provide a source of substantial additional liquidity. Dark pools charge no execution fees or lower execution fees than exchanges. Dark pools also provide fast executions and the possibility of executions at prices more favorable than the prevailing NBBO.

IB receives rebate payments for routing certain IB customer orders to dark pools. IB shares the benefit with IB customers as follows: Customers using the Fixed commission schedule pay no venue transaction fee and IB reduces the IB commission to $.004 per share from $.005 per share (a 20% commission savings) on orders routed to dark pools. Customers using the Tiered commission schedule pay no venue transaction fee and IB passes roughly 50% of the average rebates received from all dark pools/ATS’s and liquidity providers to customers for orders routed to any such venue.

 

[JSOP]

JSOP, IB markets itself as a DMA.
Should they *not* provide *direct* market access, it should make quite a splash.
I've not seen anything close to a ripple.

They are direct market access, only after holding your orders in their servers until they become marketable and became a market order then they allow you to have direct market access. Just sharing what I experienced. I used to get rebates and earn negative commissions too until I didn't. If it happened to me, it WILL happen to you. Just keep your eyes pried open on your commissions.

Don't believe in @eastern_warrior, his/her statements on IB is always biased. Not surprised if he/she paid by IB to be here doing some pathetic marketing.

 

[JSOP]

The key to best ex which many of you miss is IB will route to one exchange and re-route to others if they can get a fill. The firms buying the flow don't need to do this (and pretty much don't) as that is when they can trade against or lean against your order.

That is if they use "Smart Order Routing". We are talking about Direct Order Routing here. And how can the exchange buying the flow trade or lean against the order? They are just buying for flows, not directions??!!

 

[eastern_warrior]

They are direct market access, only after holding your orders in their servers until they become marketable and became a market order then they allow you to have direct market access. Just sharing what I experienced. I used to get rebates and earn negative commissions too until I didn't. If it happened to me, it WILL happen to you. Just keep your eyes pried open on your commissions.

Don't believe in @eastern_warrior, his/her statements on IB is always biased. Not surprised if he/she paid by IB to be here doing some pathetic marketing.

They've always done good by me and I return the favor (and I do have accounts at multiple firms but active trading goes to IB. You know they do publish their stats and execution quality reports which if you dug into (or actually watched your orders route) you'd know your statement is complete hogwash. You've never said anything positive about IB and pop up on every post regarding them so we wonder who really has an axe to grind - you paid or work for a competitor?

 

[JSOP]

They've always done good by me and I return the favor (and I do have accounts at multiple firms but active trading goes to IB. You know they do publish their stats and execution quality reports which if you dug into (or actually watched your orders route) you'd know your statement is complete hogwash. You've never said anything positive about IB and pop up on every post regarding them so we wonder who really has an axe to grind - you paid or work for a competitor?

It's strange that you and zdreg (perhaps your alter ego) are the only Elite Trader members here who sing praises out of your a$$ non-stop about IB. Nobody can say anything wrong about IB. As soon as they do, you would jump to IB's defense instantly even by lying. You are either a pathetic troll or somebody who's paid by IB to be here. My assessment about IB is not always bad. I confirmed that I did get paid rebates and even negative commissions but that all stopped all of sudden suspiciously until I discovered that IB holds orders, limit orders in their servers until they are marketable (that is confirmed by IB themselves) and then sent to the exchanges as market orders to essentially rob traders of rebates. You don't like what I said, go back and confront your boss.

Other brokerages have no incentive to pay anybody to be on some forum to promote their services because unlike IB, their quality of service/platform are all superior and their fees are even lower; their quality and fees speak for themselves. It's brokerages like IB who have to pay minions like you to come to a forum to advertise and defend their sub-standard service.

 

[cruisecontrol]

They confirmed this in writing.

I'm curious about this, can you please post what IB wrote here?

 

[sprstpd]

I confirmed that I did get paid rebates and even negative commissions but that all stopped all of sudden suspiciously until I discovered that IB holds orders, limit orders in their servers until they are marketable (that is confirmed by IB themselves) and then sent to the exchanges as market orders to essentially rob traders of rebates.

I've been trading with IB for 18 years and this has never happened to me. Either you are mistaken or you are not providing sufficient detail to your allegations that make any sense. They do not hold directed limit orders. I see my directed limit orders working in the market every day, every month, every year, for 18 years.

 

[JSOP]

I'm curious about this, can you please post what IB wrote here?

Private information, not going to happen.

 

[JSOP]

I've been trading with IB for 18 years and this has never happened to me. Either you are mistaken or you are not providing sufficient detail to your allegations that make any sense. They do not hold directed limit orders. I see my directed limit orders working in the market every day, every month, every year, for 18 years.

Like I said, just sharing what happened to me. Don't say I didn't warn you.