fhl, if I understand the commission schedule correctly, the price of $1.10 would only apply to sell orders. If I understand correctly, the SEC fees only apply to sell orders. If I had bought 200 shares of SPY, while offering liquidity, then my commission would have been a mere 70 cents. This yields an advantage, below the bundled commission, without meeting any minimum volume thresholds. The advantage is even greater as soon as we consider orders for larger sizes, like 300 or 500 shares. The advantage is also greater if we stick with 200 shares, but consider cheaper stocks, like QQQQ, which will have much smaller SEC fees. SEC fees are proportional to the number of shares times the price per share. I reckon you can buy 200 shares QQQQ for 70 cents, offering liquidity, and sell 200 shares for 80 cents, offering liquidity. I reckon you can buy 500 shares QQQQ for 0.15 cents per share, or 75 cents, offering liquidity. I reckon you can sell 500 shares QQQQ for 0.4 cents per share, or $2.00, offering liquidity. If you are buying and selling QQQQ in blocks of 200 shares, offering liquidity, your average price per share would be 0.375 cents. If you are buying and selling QQQQ in blocks of 500 shares, offering liquidity, your average price per share would be 0.275 cents. If you meet minimum volume thresholds, then it gets way better. But maybe I am all wrong on this, because the amounts I am being charged do not match with my calculations. So we will see what the help desk says.
I just edited my previous post, because I had put some of the decimal points in the wrong places. Sorry for any confusion.
Could it be they are charging the $1 dollar min comm plus the sec and minus the rebate to come to $1.45? Also, thanks for the breakdown you provided, although I'm not quite seeing where the volume discount comes from for buying 500 instead of 200 of the Q.
Q #1: No, your idea about an erroneous minimum commission would not explain what I have observed, because I have had other orders for which I was charged the correct minimum commission of 70 cents. Q #2: The advantage of 500 shares over 200 shares is caused by the minimum commission.
jim, Were you finally able to get answers from IB's Trouble Ticket system why they charged you $1.45 last week?
yes i've noticed some discrepency's also in the unbundled rates. ib's seems to have some bogus clearing fee's plus if they break the order up maybe some is taking liquidity. this will enver work if you can't track wether they're charging you or giving you rebates
I gave one specific example, but the problem goes beyond it, to the unbundled commissions in general. The CS people are working on the problem and have asked me to be patient, so I am being patient. I'll post when I have the answers.
Anyone know if there's a FIX field (either standard or IB custom) to indicate add/remove liquidity, which might be present in the FIX execution reports? A quick search of FIX 4.2 and 4.3 specs produced only fields related to quotes.
I am a little confused about the pass thru costs on NYSE stocks that sit on specialist book < 5 min. The IB unbundled commission table shows $0 for removing liq and "As charged by spec:Avg $0.01 " for adding liquidity. Does that mean that if I add liq on 1000 shares of AMD using NY route, I have to pay $10 plus IB's .0035 bringing the total to $13.50? Instead of their all in rate of $5? Thanks
Apparently so. IB charged about $19 in commissions for about a thousand share. I think for NYSE and AMEX stocks, IB should provide more clear cut examples. Besides, I have also seen other discrepancies in IB's unbundled pricing.