Clearing houses/brokers confusion

[Peacefull Warrior]

Good morning all,

I have recently started trading a demo account (cqg 3.0.8) and like the platform, things are going well and called them up to go live, however, they asked what clearing house im with, and I have no idea!!??!! I know its where the financial transactions take place, but looking on the net its not that easy, many sites recommend brokers but then you have to use their platforms, charting package etc. If anyone could should set some light to my naivity, I would be eternally gratefull.

In a nutshell, CQG as my platform, (charting package im happy with) now I need clearing with eg. of approx pricing. It would help a great deal. Oh, and if theres anything else i've missed. My initial deposit is £7.5k I know there are minimum requirements.


Many thanks.

PW

Work like you dont need the money, love like you've never been hurt, and dance like nobody is watching.

 

[BSD]

Well as far as I know - or at least last time checked - CQG are not a broker, they are only a charts and data and backtesting provider, albeit one of, if not the best of them out there.

But they are also pretty expensive, and to be honest if you want to fund your account with 8K then imo paying if I remember sthg like around € 600 / month out of that is a bit on the high side no ?

A broker I would always recommend is www.interactivebrokers.com even tho I strongly dislike their clumsy, primitive trading platform, but that apart they are very honest, fast, reliable, etc., all of that also applies to OANDA, The Currency Site: Foreign Exchange Services and Trading, and on top of that the latter have a super user friendly intuitive platform.

But that said, I do understand why you like CQG and would like to keep them on, they simply have the best charts out there, and are also super user friendly.

 

[BSD]

Aha, these days you can trade off of their charts / platform.

They are still not a broker themselves, but they route your orders to one of their brokerage partners:

CQG: Trade with FCM Partners

So either choose one of those and just have one platform open.

OR go with somebody else as broker, but then you'll need to have two platforms open all the time.

 

[ns1000]

Your confusion stems from the fact that CQG is just a front end rather than a broker. If you think of the CQG platform as a communication tool you're nearer the mark - it's basically a replacement for the phone. You need to sign up with a broker first - they'll deal with all the clearing and settlement. You can use CQG through GNI, FCT and ADM amongst others. Sign up with the broker first and you'll be on course to start trading.

When you click on CQG, it sends a message to the exchange in the broker's name. The broker is a member (or, confusingly, trades on someone else's membership) and trades with another member. The buy trade and teh sell trade then go to the clearing house to be matched against each other at the end of the day. The broker sorts this out. The broker allocates the trade to your account, and you see it on your statement. However, the counterparty to the trade is the clearing house, so that even if your broker goes bust, you still have the trade.

However, look at the costs - don't know how much CQG charge, but there may be cheaper alternatives if you're just starting out.

 

[BSD]

ns, do you know if any of the brokers CGQ partners with have competitive, IB like commissions ?

If so that would be an excellent alternative to IB's really disastrously clunky platform that would answer many a traders prayer I'm sure !

 

[ns1000]

I doubt anyone is as cheap as IB, but then I only really have institutional experience. I know a few people use ADM for retail, and personally I like GNI (have dealt with them for over 10 years), but they will be more expensive than IB.

If I were starting with a small pool, I'd likely start with IB because of the low cost and pay for a charting package seperately.

Nick

 

[BSD]

Thanks Nick

Some of those brokers should start getting a bit more competitive price wise eh to get their share of IB's business.

Ah. All the advantages of IB, together with CQG's user friendly platform and charts and ability to trade off of them, THAT would be paradise.

 

[porph]

BSD, Oanda uses the marketindex platform right? ABN Amro use the same platform but expanded to other futures. I think the platform is great (I tried oanda first) but i dont trade fx but someone helpful on here steered me to ABN and i've never looked back.

 

[BSD]

BSD, Oanda uses the marketindex platform right? ABN Amro use the same platform but expanded to other futures. I think the platform is great (I tried oanda first) but i dont trade fx but someone helpful on here steered me to ABN and i've never looked back.

I totally agree porph, athough Oanda deserves credit for the platform, it's Richard Olsen and Michael Stumm's brainchild, and they are leasing that to ABN, so it is win / win as ABN offer many more markets than Oanda who only do FX.

That is absolutely a platform that with its totally intuitive user friendliness demonstrates how it should be done.

 

[Peacefull Warrior]

Ahhhh I see, thanks guys much aprreciated, as you can tell I wasnt too update with these things. When I asked cqg to go live it was $25.00 per month and 0.25c round trip, I use prorealtime for charting....£600.00 p/month???

 

[BSD]

And the roundabout 600 / month is only for FX, if you want additional markets its even more.

But just to get the commissions part straight, they said that one of their partner brokers takes 0.25c round trip ??

Can you tell me more ?

That sounds VERY interesting, that is IB territory !!!

 

[porph]

I totally agree porph, athough Oanda deserves credit for the platform, it's Richard Olsen and Michael Stumm's brainchild, and they are leasing that to ABN, so it is win / win as ABN offer many more markets than Oanda who only do FX.

That is absolutely a platform that with its totally intuitive user friendliness demonstrates how it should be done.

I would go as far as to say it probably contributes about 5-10% of my profits through its ease of use. Mainly through the ease of placing orders visually and also in the ease of modifiying orders on the fly, especially with regards to implementing a trailing stop.

 

[Peacefull Warrior]

Apologies there, the bund was going crazy, nice tickage tho

Im still slightly confused, so if I want to keep cqg, I must first get a broker, then sign up with CQG FCM (ADM, FCT, GNI etc) and then i will be ready to rock n roll? I only trade the bund, schatz and bobl.
I have no idea which broker to use or if there any cheaper alternatives........should i use cqg or not etc etc. ahhhhhhhhhhhhhhh!!

 

[ns1000]

Best thing to do is give one of them a call - GNI is GNI touch Futures - explain you're not sure how it works, and want to use CQG to trade German rates. One of their private client brokers should be able to talk you through it - I'm sure none of your questions will be new to them.

If you're still confused, you don't have to open an account. Remember that you're in control - it's your money at the end of the day.

 

[BSD]

I've been peering really hard, but can't find any concrete info on GNI's commission rates...

Could you say sthg unless you've carved out a private deal Nick ?

Thanks

 

[ns1000]

I've been peering really hard, but can't find any concrete info on GNI's commission rates...

Could you say sthg unless you've carved out a private deal Nick ?

Thanks

Should point out that I don't use them for myself - only through work. Their comms will be higher than IB though. Thought it may be worth the OP contacting them to talk him through how he can use the CQG platform with them, and give him an idea of the total costs is he trades say 200 lots a month.

I suspect that they have their standard com rates which are negotiable on volume, but they don't seem to put them on their website (so I assume not the cheapest in the market).

 

[Peacefull Warrior]

Appreciate the feedback people, im going to give GNi a call and see whats what, i'll post the prices to make sure im not getting done.

many thanks

 

[BSD]

Should point out that I don't use them for myself - only through work. Their comms will be higher than IB though. Thought it may be worth the OP contacting them to talk him through how he can use the CQG platform with them, and give him an idea of the total costs is he trades say 200 lots a month.

I suspect that they have their standard com rates which are negotiable on volume, but they don't seem to put them on their website (so I assume not the cheapest in the market).

Thanks Nick

im going to give GNi a call and see whats what, i'll post the prices to make sure im not getting done.

Thanks you to Warrior, looking forward to hearing their prices.

 

[BSD]

Appreciate the feedback people, im going to give GNi a call and see whats what, i'll post the prices to make sure im not getting done.

And, heard anything yet ?

 

[Adamus]

Hi Folks,

this is what they told me back in June (standard deal):

All online Futures contracts on EURONEXT LIFFE, PARIS, 
AMSTERDAM, EUREX, CME, CBOT, NYMEX, MONTREAL and ICE

0 - 499 				lots per calendar month:		£2.00/€3.00/$3.00 one way for all trades 
500 - 999 			lots per calendar month:		£1.00/€1.50/$1.50 one way for all trades 
1,000 – 2,999 			lots per calendar month:		£0.50/€0.75/$0.75 one way for all trades 
3,000 – 4,999 			lots per calendar month: 	£0.25/€0.375/$0.375 one way for all trades 
5,000 – 9,999 			lots per calendar month: 	£0.20/€0.30/$0.30 one way for all trades 
10,000 - 19,999 		lots per calendar month:		£0.15/€0.225/$0.225 one way for all trades 
20,000 plus			lots per calendar month: 	£0.10/€0.15/$0.15 one way for all trades