Discussion in 'Options' started by TraderTactics, Jan 20, 2010.
Any suggestions from experienced traders would be a big help.
What is the best servcice in terms of execution? I mean, seriously.
Broker takes order, forwards it to exchange. Unless you talk pit, there is simply NO DIFFERENCE at all between brokers from there on. The execution is done purely on exchange hardware without futher intervention from the broker.
So, unless a broker delays orders (slow architecture on his side).... how can there be a best broker for executions?
Re comission rates - that depends. Negotiate. If you do enough round trips, get an exchange membership
To my experience, they all have same fill. Most of the chain does not have enough daily volume so your broker's fast execution system does rarely give you any edge. In my opinion, order routing is more important.
So many times I've seen that BID/ASK match is there but order is not executing for long time.
Most of broker will simply throw your order to the exchange where they get more routing fee and will never re-route. Not 100% sure but IB is the only broker who re-routes your order for better fill. But cancel/modify fee sucks and exchange directed order is priced high :-(
Also you get a real advantage if you can bid at .56 when other 5000 BID is sitting at .55 and 4000 ASK is sitting at .60 ; my other broker did not allow that but IB does.
I trade small lots (2-10 contracts per order) of relatively expensive options and IB is working great for me.
it really depends on what you're looking to do. I left Zecco,
$4.50 + $.50 contracts
to go to Scottrade
$7.00 + $1.25 per contract
I'm happy with it. Zecco i found, was not very competent, and I'm not sure that their doors will be open for business in 5 years. One thing I found is that scottrade's bid and ask quotes will be off, especially with thinly traded, deep in the money options.
Anyway, it really depends on what you want. Check out those two, tradeking, IB, think or swim, etc.
Also, I'm sure this same thread has been created 50 times... use the search tool!
Are you serious? Scottrade never opens during peak hours. I still have account with them but I sometime use it for week-end research.
Also how on the earth $7 + 1.25 per contract is a acceptable deal to someone when IB, OH and eOption are there.
If you want real cheap and do not care about platform. Their online tool is pretty basic. Never had account with them.
They are great for volume trader (10+ contract per order). Very slick and intuitive web platform. Used to be the cheapest for volume trader but not any more (but still best for vol trader). I like and recommend them.
Great if you trade smaller lot of relatively expensive contracts. Per contract pricing with no fix cost let you scale-in and scale-out without any worry. Wide range of instruments. I like them Very much recommended.
For options I like Interactive Brokers. The execution is no worse than any other broker I've tried and for retail traders the commissions can't be beat. On IB I can do some types of option trades that wouldn't even be feasible with other brokers because of their high commissions.
IB charges a fixed commission per contract so people who trade options by the hundreds or thousands rather than by the dozens might prefer a different commission structure.
I do a little over 800,000 shares per month with IB. I'm currently using their unbundled commission structure and I can say: IT ROCKS!!!! I use to use their bundled commission structure and last year, I paid over $35K in commissions. This year, I'm trading more shares and will most likely come in at around $25K in commissions.
IB also offers a ton of order types if you want to be more intelligent about how to place your orders. Various types of conditional, bracket, relative and other order types are supported.
Do you use TWS for option order entry? I a moving from TOS, but I cannot seem to wrap my head around the obfuscated interface for spread entry, and for the life of me cannot find out how to look at my positions in terms of a risk graph (P/L graph). I see the singel position hart, but nothing for the composite position.
I hope it exists, and it's just me having problems finding it, so any feedback is much appreaciated.
At top of page, see links in green strip:
HOME FORUMS BROKERS SOFTWARE BOOKS OPTIONS ANALYSIS CONTACT US
If TOS has the instruments you need to trade and you are ok with their comms then stick with TOS.
IB probably has better executions because of SMART routing but their interface frankly sucks for an options trader.
For spread entry you have to actually go use their SpreadTrader function to first create the spread you want before you want to trade it, unlike TOS where you can pick your spreads directly from the Trade page by just right clicking. This also presents a problem when you want to get out of spreads quickly but don't want to get out of them in the same way you got into them. E.g. if you put on an iron condor, but wanted to get out as 2 verticals quickly, you're out of luck. I think you have to first go to Spread Trader to create the 2 verticals before you can trade them. Otherwise you'd have to leg out of them as individual legs, and when the market is moving fast, you're probably going to get killed on pricing.
IB has no meaningful risk analysis graph that's detailed enough or updated real time that's going to be useful for you. So you'll need a 3rd party software if you're going to trade at IB.
You can see a composite chart but detail is sorely lacking and I don't think its real time. Go to Analytics->Risk Navigator.
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