IB Forex - 25K >

Discussion in 'Retail Brokers' started by tonylznwlr, Oct 12, 2011.

  1. Hi

    I noticed there are a lot of IB users in this forum, so it will be great and very appreciated if someone with experience can help me out here understanding how it works

    According to IB website – any amount below 25K USD or equivalent “will generally be executed at slightly inferior prices ranging from 1-3 ticks outside the IdealPro quote. “
    Whatever the hell that means , I’m not sure I understand it correctly .
    For example , let say I want to convert (not to enter a Forex position) some of my CAD to USD .
    The amount is below 25K .
    The USD.CAD IdealPro bid at that moment is 1.0255 , and I place a limit buy order at the bid price .
    Whats going to happen next ?
    1. IB just slaps 1-3 pips on top of my limit order (1.0255 to 1.0256/7/8) the order is executed immediately.
    2. IB artificially widening the actual IdealPro spread I see in TWS by 1-3 pips , and execute my order at the limit price only when\if the bid price hit at least 1-3 pips above the limit (1.0256/7/8)
    I also wonder what exactly decides whether it will 1 , 2 or 3 ticks extra ? is it something totally random or its depends on the specific currency pair ?

  2. FGBL07


    You cannot submit an order below 25k to IDEALPRO, you have to use IDEAL. And here the spread is simply wider, that is that is meant by these 1 - 3 ticks wider.
  3. You no longer enter an order as IDEAL or IDEALPRO. Just enter the order. Generally you can expect it will be executed when the best bid or ask (depending on whether you are buying or selling) is 1 pip beyond your limit price. So for example, if you are buying USD.CAD at 1.0200, you will not be executed when the bid ask is 1.0199 / 1.0200 but you likely will be executed at 1.0200 when the bid ask has moved to 1.0198 / 1.0199.
  4. FGBL07


    Ooops.. Sure? It's a long time since I traded Forex with IB.
  5. Yes. Now when you set up a forex symbol (e.g. USD.JPY), you just enter the symbol on a blank line without specifying an exchange. When you want to trade, just hit the bid or ask and enter your quantity. Whether it's $1 or $1 million, the steps are the same.

    Note: I don't recall if the small $ trades show IDEAL instead of IDEALPRO but either way, IB handles everything within their system.