Hi, To reduce Broker Bankruptcy Risk, I am looking a broker which competes with IB (yeah I know the SIPC and Lloyds story). What are my options? Which brokers is similar to IB so: - No relationship to IB (market making/clearing/etc) - Deep discount pricing model - CSV/XML-Statements/Reports (which can be processed automatically) - API for retrieving portfolio data + submitting orders etc. - Accepting Euro Customers; - Supporting European Exchanges (not really important, because I can maintain the non-US part at IB, and only do the US-trading on the second broker), Thanks!
I recently opened an account with Velocity Futures as a backup to IB. They have everything you mention except XML/CSV based reporting. They mostly deliver statements in PDF files via email which are unable to be imported into anything. They do have an export to Excel feature but it is very crude and is not conducive to automatically importing all of your trades... which is really a shame because I have tried. If they eventually get XML based reporting similar to what IB offers I will probably use them as a primary broker very soon. Commissions are lower than IB from what I've traded so far.
I think the clearing firm is more important. I'm considering MB Trading as back up broker, but I don't trust Penson as the clearing firm. Just look at a chart of PNSN.
I believe they are self clearing. However, I think the danger is not so much as IB going bankrupt, but rather their computers taking a dump on your account if they think you are over leveraged. If you like to live close to your margin limit and/or like to trade illiquid stuff that possibly have erroneous bid/ask prints after market, move that trading off to some other broker where something that breathes looks over your account before liquidating your positions. Search the threads - it is full of IB's computers gone mad horror stories.
when a clearing firm gets too big, more debt to help pay the expense. More debt, equal higher commissions equal outdated server technology due to IT tech salary reductions or understaffed
**Disclaimer: the comments below are fictional and for educational purposes only and do not relate to any person or company and any apparent relationship is entirely coincidental *** -- I maginary B rokerage ---- I have a suspicion that imaginary brokerage takes the other side of the trade (against me) on ES and does the same for another imaginary brokerage customer and pockets the edge both ways (e.g. 0.25 times 2 or $50 per ES mini contract.) I think their computer has this programmed in. The reasons for this suspicion are: 1. once I got filled outside of the high low of the day. 2. I use imaginary brokerage data feed for ninja charting and I track (=record) the key highs and lows of the day. Sometimes the ninja price is off by 0.25 and then if I refresh the data - now getting historical data again from imaginary brokerage the 0.25 vanishes. Any one else have the same suspicion?
I think this is not correct. The phenomena you experience is very well known. IB provides snapshot data. This a) reduces bandwidth requirement of IB, and b) virtually guarantees IB's data feed is not lagging behind market. I especially like IB's feed for reason (b). However, this has the following side effect: Since the data is snapshot, not all trades are reported. This is most noticeable during hi / lo prints. So it is possible you would have a fill where the trade would not print in IB's feed. You need to check a "real" feed. If that said "real" feed is also not reporting your trade, then you have reason to be suspicious. I do not think that is the case.