IB will freeze my account if modification/execution ratio >50. what will happen if you go to supermarket and was told you must buy something otherwise do not come? what will happen if you were told you have been bid too much in eBay and cannot use ebay any more? Stores/company will die to have anyone visit them and they know it is only chance they can make money. I cannot believe IB will restrict customer to submit/modify their orders to get what? less order filled? so that IB can make less money? IB can always upgrade their hardware/software to accommodate order traffic. but it is out of IB's control to keep the customer and make them to trade! I hope IB can realize that and remove the ratio restriction. I want to warn future customers this restriction when they consider openning account in IB!
My guess is this means you are modifying trades more than 50 times for each execution you're receiving. For example you make 10 trades today, but modify existing orders more than 500 times. I've read about attempts to prevent excessive modifications, they're often attempts to spoof bid/ask quotes and are not "real" attempts to trade. Why anyone would need to hit a ratio over 50 is beyond me, but if that's the case move over to another broker.
I seem to recall reading about this somewhere else, that it was based on an exchange policy. I called IB to learn the details, and I was told there is no such rule. I don't need to exceed the 50 ratio, but I would like to know what the rules are, if any, and where to find details. [rwk]
yeah..they call me once too. it's ridiculous imo.btw-i did not see this restriction statement anywhere on their site. and how the freezing procedure goes? do they give you a email warning or letter or whatever before they actually freeze your account? SideShowBob-there is many ways to trade, specifically day trade,using automated software.or simple NYSE open strategy. you place orders 100 too far and did not get filled-bye bye.. and it's not that easy to just switch to another broker,specifically from IB. if you developed some software, that ties to your broker platform, it may take a months, to do same with another broker. the only a question i have (and i hope someone from IB will clarify this for me)-how the ratio is calculated? daily,weekly? and why we did not have those restrictions 3-5 years ago? i trade same system for many years and no one never come up with such thing. all of sudden-it's a restricted now. i also cannot believe, that they just will throw me away for this..i generate at least couple thousands a month for them in commissions..IB is for active traders and that restriction i believe will put very big dent in their profits. i agree with OP-they totally on wrong patch with this one..
i hate them too, but if you adjust your orders few times a day, as stock moves up or down-should i be punished for that? imo-it's very easy to find, who does the spoof(btw-sometimes they get filled too and pay commish also). pick someone, who does 10 modifications per minute for start, not just everyone with ratio <50 per fill. btw-it's partially IB problem..with their not so smart routing. i have tens of missed trades every day, when stock traded at my price and i did not get filled,just because trade was on another ECN at that time. blame me for that...
Without modification of order is just like sitting ducks, you do want to your order unchanged while market has a huge move like today? be smart, as a customer, you should always support ourselves, in case you yourselve have some problem with IB later on. Remove the modification/execution ratio will not do you any harm, but give great advantage to other customers who already post their reasons. Don't be stupid. help and support customers ourselves!