Hello, my first post here. I have an IBKR Pro account because of the low margin rate. I also have a Fidelity brokerage account. When buying highly liquid ETFs with a penny spread, is there any benefit to using IBKR Pro compared to a retail broker that takes payment-for-order-flow and sends my order to Citadel, etc. (which gets me sub-penny price improvement and no commission)? For example, with Fidelity, a market Buy order for 100 shares of ITOT trading at $93.50/$93.51 would typically fill at something like $93.5051/share for $9,350.51 total. So $0.0049 price improvement/share. I probably got taken advantage of a little somehow, but at least I didn't pay NBO and there was no commission. At IBKR, I can't use a sub-penny offset (Retail Price Improvement order does, but that's not available for ETFs it seems), so the best outcome for buying ITOT at IBKR would be the order fills at NBB. Using my example above, I'd pay $93.50/share instead of $93.5051 with Fidelity. So I saved $0.0051/share, but IBKR commission can eat up most of that saving. And it's not a given that the order will execute at NBB with IBKR. If it executes at NBO, I definitely am doing worse than with Fidelity because of IBKR Commission. Am I thinking this right? Thank you.
It completely depends on your holding periods. For investing or swing trading you get away with payment for order flow. If you day trade order routing is absolutely key.
How much price improvement does 1 broker give you VS the other? Make sure your sample size of trades is enough and its not anecdotal.