I find it amazing that people can toss around many thousands of dollars every day the way most people wipe a piece of dust off their sleeve, but cry bloody murder about having to make an extra mouse click or two.
Why IB sucks for futures traders: stops!
- Thread starter Simtrader
- Start date
With all due respect Quah, I doubt you are a real short-term ES trader if you claim to change a stop-limit order in less than a second. If you accept the view that IB plain stops are terrible (for reasons previously outlined) and you attempt to use their stop-limits as an alternative trailing stop-loss, here's what you must do in order to move your stop up/down:
- First straight cancel your existing stop-limit order
- Wait for confirmation of confirmed out (otherwise you risk getting two fills if you enter the follow-up order without this confirmation)
- Once out, enter your new stop-limit order with one stop price and a second limit price further away (to effectively act like a plain stop). Obviously with a protective stop-loss you should not use a stop with limit at the same price because you risk going unfilled.
The fastest system and the fastest hands in the world cannout do all this is one second. My unscientific guess would be 10 seconds. When you are trailing the ES by 3-4 ticks you need the ability move your stop extremely quickly. You just cannot do this if you are only using stop-limits. You also have the risk of being exposed albeit briefly to having no stop in the market while you enter the follow-up order. Real ES traders know this, and I suspect this is why people stick with IBs stop orders despite their inherent weaknesses (they can be changed quickly). Using stop-limits as alternative stop-loss orders is not a "real world" proposition when time is very important.
To clarify an earlier point: when I talk about plain stops being held on Globex, of course I am referring only to what the end-user is seeing. We all know that in reality the order goes into Globex as a stop limit order (stop+5 pts usually). Technically Globex doesn't accept stop orders but this is invisible and irrelevant to the end-user who is with a DECENT broker!
There is simply no getting around the fact that holding stop orders on IBs servers is inferior at best and risky at worst. At best you have an extra delay in getting the order sent off and receive lowest priority in terms of who gets filled first (potential for extra tick slippage). At worst, they have a datafeed problem at the wrong time for you, and your stop order never gets triggered nor filled. While this may not have happened to you personally, it HAS happened to other good people. IB knows this happened to a bunch of people as recently as last Friday. While they may say "we've fixed the problem" ...until they tell you that stops are being routed directly to Globex you simply cannot trust that such problems will not happen again.
I want to enter a protective stop-loss order in the market and know that even if my PC blows up, even if a nuke lands on my brokers servers, that I will be filled. I certainly don't want to rely on my brokers datafeed to execute my order. The only way to solve this problem is to use a broker that sends your order to sit directly on Globex. I have never in my life heard of a stop order sitting on Globex not get executed unless something happens to Globex itself (in which case everyone is screwed no matter what broker they are with). But these problems DO happen at IB.
No number of quick one-liners can detract from the seriousness of these flaws. I am not by the way, promoting J-Trader as an alternative per se. There are many J-Trader brokers in this forum who only use a version that holds your stops on your PC (with all the same risks and delay in execution). I wouldn't use them either. I ask a broker two initial screening questions:
1. What is your commission rate?
2. Does your platform enable me to send stop orders directly to Globex, or does it hold them on your servers or my PC?
People doing ES short-term trading should be aware of these issues before they get burned by them.
- First straight cancel your existing stop-limit order
- Wait for confirmation of confirmed out (otherwise you risk getting two fills if you enter the follow-up order without this confirmation)
- Once out, enter your new stop-limit order with one stop price and a second limit price further away (to effectively act like a plain stop). Obviously with a protective stop-loss you should not use a stop with limit at the same price because you risk going unfilled.
The fastest system and the fastest hands in the world cannout do all this is one second. My unscientific guess would be 10 seconds. When you are trailing the ES by 3-4 ticks you need the ability move your stop extremely quickly. You just cannot do this if you are only using stop-limits. You also have the risk of being exposed albeit briefly to having no stop in the market while you enter the follow-up order. Real ES traders know this, and I suspect this is why people stick with IBs stop orders despite their inherent weaknesses (they can be changed quickly). Using stop-limits as alternative stop-loss orders is not a "real world" proposition when time is very important.
To clarify an earlier point: when I talk about plain stops being held on Globex, of course I am referring only to what the end-user is seeing. We all know that in reality the order goes into Globex as a stop limit order (stop+5 pts usually). Technically Globex doesn't accept stop orders but this is invisible and irrelevant to the end-user who is with a DECENT broker!
There is simply no getting around the fact that holding stop orders on IBs servers is inferior at best and risky at worst. At best you have an extra delay in getting the order sent off and receive lowest priority in terms of who gets filled first (potential for extra tick slippage). At worst, they have a datafeed problem at the wrong time for you, and your stop order never gets triggered nor filled. While this may not have happened to you personally, it HAS happened to other good people. IB knows this happened to a bunch of people as recently as last Friday. While they may say "we've fixed the problem" ...until they tell you that stops are being routed directly to Globex you simply cannot trust that such problems will not happen again.
I want to enter a protective stop-loss order in the market and know that even if my PC blows up, even if a nuke lands on my brokers servers, that I will be filled. I certainly don't want to rely on my brokers datafeed to execute my order. The only way to solve this problem is to use a broker that sends your order to sit directly on Globex. I have never in my life heard of a stop order sitting on Globex not get executed unless something happens to Globex itself (in which case everyone is screwed no matter what broker they are with). But these problems DO happen at IB.
No number of quick one-liners can detract from the seriousness of these flaws. I am not by the way, promoting J-Trader as an alternative per se. There are many J-Trader brokers in this forum who only use a version that holds your stops on your PC (with all the same risks and delay in execution). I wouldn't use them either. I ask a broker two initial screening questions:
1. What is your commission rate?
2. Does your platform enable me to send stop orders directly to Globex, or does it hold them on your servers or my PC?
People doing ES short-term trading should be aware of these issues before they get burned by them.
So we're agreed then. With IB you can either use a plain stop order and change it quickly, or use a stop-limit limit order and go through the hassle of what I described. Which takes us back to the issue why IB stops orders are a problem.
I get the sense that you don't read what I write and have no interest in debating the serious issues I've raised, preferring instead to engage in blanket dismissals without ever providing anyone with any useful information.
What I am saying is simple:
- IB holds stop order on their servers and this is inferior to holding them on Globex
- Using IB stop-limit orders is not a real-world alternative for protective stop-losses because such orders cannot be modified quickly enough for the ES scalper
If anyone can either prove that these two points are factually incorrect or can provide a legitimate counter argument, please do so. I would love to hear it. Heh, if IB can get their stops native on Globex I'd love 'em too.
Call it "bashing" call it what you like. But this is a real-world issue and maybe just maybe, with enough people beating IB up over it, they will actually made CHANGE things and enable stops to go native on Globex. Some people are too content with the status quo. Others aren't even informed of these "differences" between brokers. They should be!
I get the sense that you don't read what I write and have no interest in debating the serious issues I've raised, preferring instead to engage in blanket dismissals without ever providing anyone with any useful information.
What I am saying is simple:
- IB holds stop order on their servers and this is inferior to holding them on Globex
- Using IB stop-limit orders is not a real-world alternative for protective stop-losses because such orders cannot be modified quickly enough for the ES scalper
If anyone can either prove that these two points are factually incorrect or can provide a legitimate counter argument, please do so. I would love to hear it. Heh, if IB can get their stops native on Globex I'd love 'em too.
Call it "bashing" call it what you like. But this is a real-world issue and maybe just maybe, with enough people beating IB up over it, they will actually made CHANGE things and enable stops to go native on Globex. Some people are too content with the status quo. Others aren't even informed of these "differences" between brokers. They should be!
Magna
Administrator
Simtrader,
Slow down in your immediate responses, read what people are saying. On IB I used straight stop orders for quite a while, still sometimes do, I realize they sit on IB's servers and aren't sent to Globex until triggered. Even so, I usually have no slippage whatsoever, and the worst I've experienced in both the NQ and the ES is 1 tick during a fast market.
Setting up stop-limit orders on IB solves the "non-native" problem, as now they sit on the Globex servers. Changing either stop or stop-limit orders in IB is a piece of cake, no need to cancel the existing order, simply change the price, etc. and re-transmit it. Can be setup with hot-keys if you are a scalper.
Anyway, not so sure what you are harping about and why you're so fired up in condemning IB....
Slow down in your immediate responses, read what people are saying. On IB I used straight stop orders for quite a while, still sometimes do, I realize they sit on IB's servers and aren't sent to Globex until triggered. Even so, I usually have no slippage whatsoever, and the worst I've experienced in both the NQ and the ES is 1 tick during a fast market.
Setting up stop-limit orders on IB solves the "non-native" problem, as now they sit on the Globex servers. Changing either stop or stop-limit orders in IB is a piece of cake, no need to cancel the existing order, simply change the price, etc. and re-transmit it. Can be setup with hot-keys if you are a scalper.
Anyway, not so sure what you are harping about and why you're so fired up in condemning IB....
This is degenerating! You have to enter two different prices for a stop limit don't you? It's obviously slower to modify a stop-limit order than to modify a plain stop order. The truth is also that many IB traders will not be educated enough to only use stop-limits for protection, because they are unaware of the problems with stop orders.
So can we at least agree that the way IB handles plain stop orders (held on their servers) is inferior and riskier than having them rest on Globex? C'mon, you may like IB but at least agree on that point! After all, it's IB stop oders that *most* people enter for protecton not stop-limits.
So can we at least agree that the way IB handles plain stop orders (held on their servers) is inferior and riskier than having them rest on Globex? C'mon, you may like IB but at least agree on that point! After all, it's IB stop oders that *most* people enter for protecton not stop-limits.
. So, lets get this straight - your complaint is that IB does not submit a stop-limit order for you when you tell IB to submit a regular (stop-market) order? LOL.
To answer your question - yes, of course there are two prices - but only one of them will need to be changed - the other one is already set far above (or below) the market, right?
You also neglect the fact that IB has more than one way to process a stop order held on it's servers - i.e. last price, double last, etc. So if you like those features, you will use regular stops anyway.
To answer your question - yes, of course there are two prices - but only one of them will need to be changed - the other one is already set far above (or below) the market, right?
You also neglect the fact that IB has more than one way to process a stop order held on it's servers - i.e. last price, double last, etc. So if you like those features, you will use regular stops anyway.