What does this mean, guys? CHANGE IN COMMISSION CAP Effective Monday, 12 March 2007, IB will be raising the commission cap for U.S. and Canadian stocks from 20 basis points (.2%) to 50 basis points (.5%). This change will impact very cheap stocks (e.g. those trading at less than 1 USD or 2 CAD) and is necessary to better align the fee structure with the costs and risks associated with low priced securities.
if you trade cheapies like me, the commission cap goes up. 50c stock * .2% = .001/share so, 1000 shares = $1. 5000 shares = $5, 10000 shares = $10 the new way, 1000 shares = 2.50, 10000 shares = $25.
Bye bye IB!!!! This outfit is going public and just like CBOT,CME,NYSE they will raise fess commissions etc.
well, i have no intention of leaving IB. they've been great to me on most things. however, this does mean they will be taking less of my trades. c'est la vie.
My concern is that there have been a number of "tweaks" in the last few months at IB all detrimental to their customers' profit margins. For example this whole business with bundled commissions not including ALL fees as they did for years beforehand. There is no way anyone should be using bundled anymore. I dont know why they even bother offering it now. They ARE clever about it though - they seem intent on only affecting a minority of traders. However if you believe, as I do, that it is MOSTLY this minority that are profitable, then the net result is that they hold onto customers that are generally losers. Whats next? The withdrawal of their free API service? From a short term corporate point of view this is clearly brought about by the intent to maximise IPO price. However in the long term the intense customer churn from their preference for losing traders will damage their reputation as a cutting edge discount brokerage. It is, I'm afraid, all about short term greed at the end of the day. And it possibly signals the end of an era for long term IB customers.