Tiered or fixed pricing for Interactive Brokers?

Tiered and fixed pricing are the fees pricing scheme offered by Interactive Brokers. I am on fixed scheme because it is default choice.

I would like to ask the more experienced elitetraders here, especially those who deliberately switch to tiered pricing. Under what trading situation is tiered pricing scheme better than fixed? What kind of trader/investor should choose tiered scheme?

 

1. Regularly doing over 300k in volume.
2. Mostly providing liquidity vs taking.

 

I have been an IB customer for a while. Just went through it myself. Tiered and fixed pricing depends on what your account volume is and importantly your account size. Also if you do stocks or Options Trading. If you do not want to worry about all this, you should use someone like Tradier who are offrring me unlimited equity and options trading for $60 capped or ETrade who is offering 2 months free .

 

If in doubt after considering d08's two criteria, switch to the tiered scheme and compare your real life realized per share commission under the two different schemes and choose the cheapest scheme.

 

I just want to toss out an alternative. We offer per share and per trade pricing. If your average order size is between 2000 and 10,000 shares at IB, we can save you a lot of money and still provide access to ECNs and Exchanges with their maker-taker schedule.

 

300k per trade or over longer time period like one month to one year?

 

I switched to tiered after I wrote a program to analyze all my past trades and figure out which commission structure was better. It certainly was not obvious to me that tiered was better before I did this. I don't do a lot of volume and I sometimes take liquidity and sometimes offer it. But tiered was still better for me. I should have switched sooner.

 

This is something you should have read on their website.

I'm not sure why people don't even bother to look around on IB's website before asking questions.

It's 300k per month on US exchanges, above that goes to the next tier (lower commis). Next tier is 3m per month.

 

Ok. THanks. I did read the website but it did not get into my thick head then. I read it again after you pointed it out and this time, it got into my head. Thanks.

 

I plan to open an account with IB soon and I will be picking their tiered pricing. A great example in difference of pricing (especially the last example) is when you press on the tiered structuring while on commissions, click "Click here for some examples". It is the last sentence in the paragraph under the title "North America".