That could be a very obvious or stupid question, but while I was reading another thread Babak mentioned EDAT execution as one of the "minimum requirements for intraday trading". Im not sure exactly how IB executes their trades so maybe someone could explain it to me. I assume that it might not be quite as "instant" as some other brokers since it's only $.01 a share. But I also notice a lot of threads about IB on this site so I assume a lot of people use it and I think Im going to use it to get started even if the execution process is not exactly what I thought it was. Just curious more than anything else. Trying to get as many facts straight as possible before taking that big first step. Thanks Marty
Marty, You can route your orders with IB to the same exchanges and ECN's as any direct access broker. There really isn't a difference in execution between IB and other Direct access brokers. So, the answer is IB is a EDAT with no charting or bells and whistles.
Is IB EDAT? It depends how you define EDAT. It is nothing like RealTick where you point and click Level II screens to enter orders. Software not as stable. Not as many routing options. And the worst customer service. God help you if the system goes down. There is no one to answer the phone. Recommended for amatures, but not for the true professionals. Although many in this forum, I'm sure will disagree. Bill
EDAT is defined - last I heard - as a system that allows one to route electronically with no human intervention into a market place. Yes IB is EDAT. As for snipers routing comments, I'm missing something. IB has direct links to each of the ECN's and NYSE. It offers the choice to route to a specific ECN, BEST_ECN or BEST (includes market makers). It links and routes toall the options exchanges, routes directly to GLOBEX and A/C/E etc. IB does not support level II and does not have bells and does not have many bells and whistles. I'll question the stabilty comments as the platform has been reliable. The low fee is a function of cost and volume. IB self clears and is fully automated front to back. The system executes over 200,000 trades a day on a global basis. In addition, the list of professional institutions using the system is very impressive. My advice would be to try more than one platform/broker and then stick to the one you like most. As you can tell from reading this forum, preferences vary.
martyg: Rest assured, IB is very definitely "EDAT" (Electronic Direct Access Trading). Sniper Trader1: Come on Sniper...Ease up on the rhetoric just a bit. Martyg is obviously new and your post borders on seemingly intentional confusion. I've viewed many of your posts and your comments are usually far better/more informative. Remember, when someone new jumps in here trying to learn something, things can easily be misconstrued. And, usually, customer service at IB really isn't that bad. Later, BSAM
Sniper-Trader1 is right about one thing-"God help you if the system goes down" and you are trying to cover a short postion. The telephone won't do you much good. I'd like to hear other's comments about this problem with other brokers. I know Datek isn't any better.
>Recommended for amatures, but not >for the true professionals. Don't believe him Marty (no offense intended Sniper). (My comments are only relevent to Naz traders as I don't trade listed) I am a professional (trade own account for a living) who has used MB, Cyber, Tradescape, Tradecast, Protrader, and a few others too useless to remember (actually to useless to forget, but that's another story). The ECN connections I have on IB are superior to those of my other favorite broker (MB). Sniper is correct that at IB I don't have as many algorithm options available with each ECN as at MB, but I only want direct connection anyway...I don't want anything "working" my order other than my stubby little fingers. I divide the "interface" into two sections and rate them separately... A -- Information interface: Beyond bad. Don't even consider trading with their data. Do what IB recommends and get a reliable third party data/charting vendor.(I completely recomment RealTick from Realtick.com) B -- Execution interface: Quirky, but then after use, you learn that it is actually *better* than some of the popular "pro" apps (like Realtick). For routing I will put myself (using the IB hotkeys and a properly configured page) up against any pro using RT, Cyber, Protrader, etc. and I believe I will beat them. I certainly can say that *I* am faster on IB than on any of those others (I am a scalper where speed matters). Direct ECN execution speed is every bit as fast as those other "pro" brokers (I still maintain an MB account and use it as a backup) Occasionally an order will get lost or hung, but I've had this problem with every broker I have ever had. I have found the platform very stable (run it on a nice computer with plenty memory and you should be find). Customer support is beyond lousy and I've learned to live with it (while I'll learned to live with the $5K per month commission savings). You'll have to pry IB from my cold dead fingers and if I ever have to move on it will cost me the yearly salary of a very middle class American family. Marty, you probably can't afford NOT to use IB. JB
Hi Marty There is two ingredients to EDAT trading. One, direct access to ECNS and MMs. Two, Point and Click executions. Both of these are vital to trading intraday. The second ingredient is lacking with IB. You have to keep in mind that you are trading against professional traders who are well capitalized and have access to the best equipment money can buy. When you miss taking out a Bid/Ask because another trader using realtic got there before you, you'll start thinking twice about paying 1 cent per share commissions. If you buy 500 shares of a stock and have to pay just a sixteenth more per share because your using slow software, that comes out to 31 dollars. There alot of better alternative out there. Try equity trading online. They charge 5 dollars plus 1 cent per share. Alot of these company have intro offers to new accounts. They only charge 5 dollars per trade for the first month. Sterling
Okay, No ARCA NOW orders. Best ECN locks up mysteriously. In my experience software not even closely measure to RealTick's stability. And you didn't address the customer service issue (by email) etc. I remeber a while back, IB recommended having another account with another broker in case the system goes down and you needed to exit positions. I won't go any further on this issue. I am sorry if my post caused confusion. It wasn't my intention. I still stand behind every word of my original post. Exactly! Bill
None taken! As I said, I'm sure many will disagree with me. That is the beauty of life. Great post by the way. I'm glad your experience is different than mine. Bill