market data fees for "professional customer"

Discussion in 'Data Sets and Feeds' started by lightrader, Aug 26, 2011.

  1. Hi, I want to understand if an active trader who trades for a living but trades only with his own money (and not with money of any other people) will be considered "professional customer" under the market data provisions and therefore will be required to pay the higher professional fees?

    All the market data fees issue seems to me pretty arcane as an issue that was relevant mainly to the times when such information was really exclusive and unique. However, with all the various sources of data that exist today (many of them are free and provide delayed and even real time data) why should someone be forced to pay that hefty fee to the exchange for a market data that he can get from other sources more cheaply?

    Why are the brokers not giving the choice just to have delayed data and therefore not to force the customers to pay these fees (I assume the exchanges do not charge for delayed data but only for real time data, since otherwise I should be charged a fee everytime I check a quote on google or bloomberg).

    Also, I don't understand why does someone who trade for his own account and does it through a company in which he is the sole shareholder (because of tax considerations, for example) have to pay yearly fees of about 3k just because of this "professional" definition. What's the difference if he operates as an individual or through a wholly owned entity and doing substantially the same trading operation?

    I asked these questions also in another forum but I still did not get a clear answer so I also post it here. Thanks.
  2. for me i'm considered a professional because i became a member for lower transaction fees. those lower transaction costs (about 50 cents roundtrip per treasury futures contract roundtrip) far outweigh any surcharges on data.
  3. Hey lightrader, are you ligh trader or light rader? lol

    well, if you are the only shareholder of the company, you still have to pay professional fees just because at any time, someone else can join your company for trading purposes. however, if you are an individual trading, at no point can someone else (legally) join you as an individual.

    some brokers do offer delayed data for free.
  4. Thanks for your answer. I want to understand if in case the broker allows such delayed data and I am considered "professional" for market fee purposes do the exchanges charge (directly or through the broker) the market data fee also in this case? or the market data fees charge is only regarding real-time data and not delayed data?
  5. Which exchanges are you referring to? If you are being charged for delayed data, you might as well not pay for a data feed and obtain it from a free source, maybe yahoo or google. Also, I don't think exchanges charge users directly for data.
  6. CrackPipe

    CrackPipe Guest

    professional means registered.

    as for data fees - someone is paying the exchange. either your software provider or your broker and bundling the expense into your bro'/software fees

    exchanges typically sell data to companies with the right to resell it/distribute it to their customers (eg cqg, dtn etc), or sell it to firms for internal use only - like a prop shop, bank, hedge fund etc.

    data is big biz for exchanges. typically 30% of their revenues.
  7. I am referring mainly to the options exchanges (such as CBOE and ISE) but generally I want to understand if the exchanges (and therefore the brokers) can charge "professional customers" not only for real data but also for delayed data, so that if I am defined as "professional customer" I may be required to pay for such delayed data to the broker (which may transfer this amount to the exchange) although I can have access to this delayed data from other sources for free as you suggested. I assume that it is not possible that I will be charged professional fees for delayed data but I want to make sure that I am not wrong.
  8. poemriver


    I mean the price can go earlier,I was told that Redi FX in GSET is good ,but i can't get a PB with them.So is there other platform you guys think batter?
  9. after checking out a few sites, it seems as though many firms offer delayed data for free to pro users, or they do not offer delayed data at all (probably because it's free so they won't make any money off of it). my suggestion would be to find a good broker, do not subscribe to any of their data feeds and obtain your own delayed data from a free source.
  10. CrackPipe

    CrackPipe Guest

    if you really are a 'pro' paying for delayed data will be a non issue as youd just go for live data given its all peanuts anyway.

    stop being a piker.
    #10     Aug 30, 2011