Hi Everybody, I'm just an ordinary guy with a lowish 6 figure trading account (~300K), so definitely not a big swinging decks of this club by any means, I however trade a majority of equity options (SPX and /ES options) and also sometimes bitcoin futures (micro's); I averaged around $5K-$8K in commissions overall for my trading acct at IBKR for the past 3 years, My question is it worth it for me to get an CME IOM Membership (Seems like net-net a $25K cost)? I'm fully aware that my trading volume probably alone does not justify it. Main reason I'm thinking is: (a) Seems like the price of the seat will hold up well. If I trade /ES options and crypto micro futures on my current volume, I will save some money; will take probably 10 years for the discount to pay off the investment but I've been trading for that long too! On the off-chance, I don't commit myself to my long term journey, I can still lease it or sell it. (b) Pure vanity. Having a seat on an exchange has been a dream for me since childhood (yes I know very autistic childhood) similar to how some Packers fans wear proudly NFL Owner cheeseheads on their heads (yes I'm well aware that the real value of the seat has gone away as it no longer grants you equity ownership into the exchange - just like Packer shares are just empty shares); and I'd like tour CME floor before all of the pits close down. So this is pure vanity lol. Curious if anybody who has a membership say the lemon is worth the squeeze? Seems like most archived posts either are very dated in the 2010's or belong to big swinging decks where getting the seat is a no brainer… any micro-futures or 1 lot Johnny out there like me who have dreamed and took the plunge lol??? Thanks in advance for your help/info!
You would save the exchange fee. Call CME membership, they will email you the forms, Buy seat plus $2k admin fee, email IB and they will adjust your commissions.
You have to do the calculations. years ago, the commission fee I had to pay was $3k in a month. I applied for the exchange membership (not the CME exchange) immediately.
One more thing you need to factor into your savings calculation is paying Self-Employment Tax (15.3% up to 142,800, then 2.9% on anything greater than 142,800) on your gains from the products that are included in your membership. This assumes you are a US Citizen.
So if you have a seat and you just notify IB of it you can save the commissions? I don't understand, aren't you still trading through IBs system and therefore still paying their fees unless you are trading direct on the exchange? How does this work exactly if I trade though IB and have significant commission I'd like to reduce?
You pay IB to clear your trades plus the exchange at the moment. Members do not pay the exchange fee but do pay their clearer to clear their trades. Look on the IB website and it will break down the saving.
Hi Maxinger. I'm new to ET and I came here looking for help with lowering my exchange fees for trading SPXW. I only trade SPXW and I'm currently averaging $2,500 p/month on the exchange fees, this is not including the IBKR fees and commissions. So if I'm reading your post correctly for SPX trading I need to contact CBOE, NOT CME. Is that correct?