pro realtime future trading with IB
02/07/2020 at 12:42 PM #118935
I currently trade using PRT with IG, trading spread bets (I’m based in the UK). However as my position sizing has increased I find Im paying a lot in spreads – e.g. £20 per point position in DAX costs me £40 per trade. I am considering moving over to trading futures using PRT still but trading futures contracts with Interactive Brokers. Does anyone have any feedback on this? Whats the data feed like with IB, is it stable? What is slippage like on average for market orders?
Appreciate anyones experience here.
Thanks02/07/2020 at 11:14 PM #11898102/08/2020 at 9:44 AM #119011
e.g. £20 per point position in DAX costs me £40 per trade.
Are you calculating spread twice per trade in above and is your positi0n size = 10 and are you dealing when DAX is closed / overnight? £40 per trade spread costs seems excessive??
What is the equivalent spread cost for the same scenario on IB?
If your calculations are correct maybe we all need to find a new broker?? 🙂02/08/2020 at 9:53 AM #119012
£40 per trade spread costs seems excessive??
For a £20 stake a £40 spread would be a spread of 2.0 pips.
DAX during the day is 1.0 or 2.0 for spread betting depending on the time of day and jumps to 5.0 overnight with also some time at 4.0. So those fees would seem about right for day trading.
You must be logged in to access attached files.02/08/2020 at 10:10 AM #119014
So those fees would seem about right for day trading.
Yeah I agree now … I had sleeping pill last night and the coffee is just about starting to clear the drug haze! 🙂
I just spent 10 mins trying to find IB spread size for DAX … its like one of those telephone enquiry menu systems … more and more choices to make but I can’t get to spread figures for DAX.
EDIT / PS
Just thought … maybe IB don’t charge spread … they charge commission??02/08/2020 at 10:28 AM #119015
Just found below (in italics) on elitetraders.com
No need for most of us to worry … which category do we fall into?? 🙂
IG and CMC et al are Bucket shops.
If you start to make big money in an instrument that they cant hedge easily.
Then you are put on delayed fill, where your orders will be held and often rejected if the market moves through in your favour.
Buckets shops will always allow consistently losing punters to lose as much money as they can. They will be free to trade as large size as they want to.
But will make it really hard for consistent winners to trade size and fast markets.
Has always been like that as everyone who has read ROASO will recall.02/08/2020 at 6:31 PM #119039
Thanks for the replies guys. Yes I am calculating the spread twice once for the entry and and once for exit. Interactive Brokers and pretty much all futures brokers don’t charge a spread, you pay a fixed commission per trade. So for my position sizing its much much cheaper to pay the commission of about 5 EUR per contract (mini DAX). However, the one aspect that is unknown is the amount of slippage per trade which will of course add to costs. Ive heard from other friends that ES for example you can expect 1 or 2 ticks slippage which is negligible.
Another question… because trading futures means that orders have to be paired on an exchange via the PRT platform and the connection to IB, I would guess that internet speed and/or proximity of the PRT server to the exchange will make a difference. Does anyone have experience with order execution on PRT and IB? How is it? Any issues with speed?02/08/2020 at 7:50 PM #119041
I am calculating the spread twice once for the entry and and once for exit.
Spread is simply the difference between the price that you can buy at and the price you can sell at. So a spread of 2.0 means that if you bought an instrument at 100.00 and then immediately sold it before price had a chance to move you would sell at 98.00 and so have lost 2.0. You do not need to apply it twice as it is just the difference between entry and exit prices.02/08/2020 at 9:28 PM #119055
Cheers Vonsai. Perhaps it only 1/2 as bad as I thought then. But don’t we also get worst fill price on the exit compared to if we traded directly on the exchange? E.g. say we are long and spread is 1 pt. We enter at 100 but due to the spread we actually get a fill at 101. Price moves in our favour and we wish to sell at 110, when price reaches 110 we execute the sell order but due to the spread we actually sell at 109. We lose 1 point on the entry and another 1 point on the exit. That was my understanding of how it works, the broker is payed the bid/ask spread on each trade (i.e. the entry and the exit) not just once per round trip. If Im wrong and we only pay the spread on the entry then awesome, its not as a bad as I though and there’s perhaps less in it between the typical futures broker and these spread bet/CFD brokers.02/08/2020 at 11:03 PM #119062
What you have described is correct for a spread of 2.0. Market price is in the middle of spread. So you lose 1 pip on entry and one pip on exit for a spread of 2.0 compared to buying ‘at market’ and then paying a commission.
It makes no difference what price is as an in and an out will always just have spread deducted from any profit or loss.02/09/2020 at 1:42 PM #119087
IG.com have rebate programs on the spreads if you are trading at decent sizes for CFDs at least https://www.ig.com/en/cfd-trading/rebates
the volumes required to hit the rebate didn’t seem that bad especially if you are trading at £20 per point though there is the CFD tax thing…..
why not just contact your account manger and see what they can do?