Execution: Retail vs Prop

Discussion in 'Retail Brokers' started by matador04, Oct 14, 2009.

  1. How much better is the execution at a prop firm than retail? Prop typically has direct access to exchanges, no? Retail goes through a couple of layers before reaching the MM doesn't it?

    For example, at IB they first try to cross your trade internally then they use Smart routing (but isn't Smart just a requirement due to NBBO?)

    Help a retail trader out...thanks
  2. google "reg NMS" "order protection rule"
  3. prop gets all the good fills every day, twice on Sunday., retail get the crumbs.

    Ask Don Bright
  4. bid4pk


    You can still trade retail and trade direct access. I have a great direct access broker. Executions are lightning fast and have access to NSDQ Total view.

    "Smart Routing" means they route your order to a preffered MM/ECN usually NSDQ and ARCA because they take payment for order flow. Due to the NBBO, all orders are "smart routed" Hope this helps.
  5. def

    def Sponsor

    wrong, smart routing means the order goes to the exchange with the best price. the IB execution stats and independent audits showing large price improvement over other brokers speaks for itself.
  6. I have gotten some very good prices with IB smart routing.

    I also believe that you can choose whether to "smart route" your trades or to force them on one exchange.
  7. So is Smart routing just used for marketing purposes? Wouldn't you have to send it to the exchange with the best price anyway?
  8. If I am a market maker on NYSE and my price is not as good as other market makers, how do I attract traders' orders?

    Simple, I PAY the brokers to send their customers' orders to me.

    If you are a broker and you can make money by sending your customers' orders to the paying market maker, what would you do?

    On many occasions, I sent market orders through my ex-broker and had to wait for 2-3 minutes to get filled. When I got fed up and tried to cancel the market orders, I couldn't, the "cancel" button doesn't work for market orders.

    You may ask: why didn't you change a broker?

    Well, I didn't know. Everybody started in ignorance. There are currently tens of thousands of retail traders who don't know that they are being deceived by their brokers.

    "Roger that.":D
  9. def

    def Sponsor

    markets are fluid. for example, you may place a bid at one exchange while your offer could get filled at another exchange and IB will re-route orders accordingly. It's not exactly as simple as that but the best I can say is that IB's execution stats and independent audits of price improvement are real and we'd encourage any trader - professional or otherwise - to give us a go against their current broker to see the difference themselves.
  10. Thank you
    #10     Oct 29, 2009