The problems that I have with IB is its high margin and less-to-be-desired trading software. Its margin is absolutely prohibitive and its in-house designed TWS is horrible to say the least and there is a not a lot of choices of platform that they offer. And for those reason, I stay away from them. Other than those problems, IB is fine. Never have to worry about not able to withdraw your funds and the execution is fast. Oh well, I guess with their low commission, you can't have everything.
Risk management at Fidelity is super hostile. You're lucky they didn't ban you from trading altogether and tell you to get out with no reconsideration. That's their usual response to anything odd.
A couple of questions: What do you mean by high margin in IB? Do you mean margin interest rate is high in IB compared to Fidelity? !!!. Actually it is lower and it is over 5% lower. Please elaborate because my blood started to boil when I read your statement as I have used both and many other brokers. Do you believe Fidelity's platform is better than IB's platform? Sorry I can not even compare them It is like comparing Lexus with a cheap car. Even Fidelity active trader pro is sub par to IB. Many traders that use IB platform are not familiar with bells and whistles of TWS. I hope you make a decision that makes sense and makes you happy but I was shocked with your statements. Can you trade between 4PM and 4:15 PM ET in Fildeity? The answer is no. Call them up and ask them why. Ask them can you put an order which is true for the regular hours and after hours? the answer is NO.
I assume he is saying that margin house rules are high. That is a very broad statement and not always true. I would say that equity and options margin rules are average vs other online brokers while futures margin is higher than most FCMs. I can't compare them to other online brokers for futures margin because I have no experience with that.
Sorry.I realized that you were not comparing IB to Fidelity and your statements were specifically to IB. While my statements are still true but I would like to know what you meant to margin rate is high in IB.
Well first, we are just discussing some brokers who take our money so no need for blood to boil. LOL Anyway, moving onto IB... When I mean margin, I am referring to the leverage that IB requires for trading for both Futures and Forex, they are high and not competitive at all comparing to other FCM and other brokers. Its DAY margin on Euro FX Futures for example is $4825!!!! That's FOUR times more than any futures brokers out there charges. Forget about the other popular futures contract like CL, GC, you won't be able to trade them unless you have at least #20K in the account. And even its day margin on E-mini SP 500, the most liquid Futures contract traded is still high comparing to other brokers. In Forex, its margin is 33:1 on MAJORS, that is the HIGHEST in all brokers in the Forex industry. The SEC from US imposed a maximum leverage cap of 50:1 to all Forex products and that is already the lowest among all the regulated countries but IB's leverage is 33:1 !! Second, regarding TWS, even with its bells and whistles that the software may offer, in my experience, it's still badly designed software that is horribly outdated which results in extremely slow performance at times and very prone to errors. What is even more concerning is that when you report these problems to the technical support, they completely ignore you; they either deny it pretending it doesn't exist or ridicule you the clients let alone do anything about it. On top of that, IB is the ONLY broker that I know that does NOT offer a decent charting facility. For the longest time, all you have is a clumsy, clunky and completely inaccurate charts that plots midpoints of price. Who, in this day 'n' age plots "midpoints" on a chart for trading?? IB's new charting software from MultiCharts is an improvement but still it still has a long learning curve and many of the indicators are still either missing or not properly programmed. And if you want to use MultiCharts to trade, you have to pay each month. Oh and btw, you cannot trade from 4:00 pm to 4:15 pm either on IB. It's their daily maintenance. And not only that, if you trade forex, you cannot trade the kiwi from 3:00 to 3:15 pm either. And IB is the ONLY broker in the forex industry that does this and it's absolutely ridiculous and inconvenient and risky. Anything can happen within these 15-min. period and you cannot do anything about it. They claim first it's compliance to regulatory requirement from the New Zealand exchange which is totally not true and is utter BS. There is absolutely no such requirement from the New Zealand financial authority anywhere and then when I probed more, no customer service can tell you an answer for sure. I later found out it's because IB is trying to sync the spot forex with the trading of the kiwi futures and somehow the kiwi futures has a trading halt from 3:00 to 3:15 pm something like that. WHY? They want to do that? I have absolutely no idea and nothing published from IB ever explains it. Like I said, NO any other brokers around the world in the forex industry has this "trading halt" on the kiwi and they are fine so obviously this is not needed. But the fact that they don't even properly explains to their own employees and their clients what that "trading halt" is all about is just appalling. Their swap rate, or roll-over interest rate on Forex currency is horrible, the LOWEST among all brokers. Like I said, the ONLY thing positive about IB is its execution, slippage, and the fast processing your withdrawal requests. Besides these, there is nothing else. Glad I left there because comparing to IB, any broker is a + and I am sure Fidelity would be too.
As every knows that reads my posts, I'm not a lover of IB or TWS. But to be fair, you can't build a platform that is great at everything. If you have high expectations for a platform that trades futures or options, I believe there are better ones available. It would be more fair to compare TWS to TOS or another clearing firm's platform that does many things. I have only used TOS and TWS. I find that TWS is better for equity trading but TOS is better for options trading. There are broker neutral platforms out there that excel at one asset class that are better in my opinion than both TOS and TWS. I have never used Fidelity.
LLXa , I enjoy reading your discussion and I hope people can find something out of it. Today was a slow day for me.I did 2 option trades in my IB account. Sold 4 contracts ETF Call premium of 0.67 and I paid $1.69 commission total Sold 6 contract stock Call premium of 0.2 and I paid $2.2 commission total. If I had done that in Fidelity it would be like $23 total instead of $3.89. There is a big difference. I don't trade Forex and Futures so I cannot comment on that but I have done many many trades executed at between 4:00 pm to 4:15 Pm with entering one order early in the morning good for the day including extended hours. I believe our trading styles are different and both of us are happy with the brokers that we use. IB is not for everyone. I believe it is more for active and reasonably funded traders. I see some brokers encourage traders to open an account with $500 to trade Emini. You can lose $500 in Emini in seconds and then what? Deposit another $500? Close the account?
You forgot the number of markets available, which other retail broker offer even close to IB, except more expensive Saxo ? Also whereas the swap rates are terrible with forex (as IB don't calculate it as swap rate, but just add/reduce the forex position to one's account balance) the margin rates are several times lower than their retail competitors.