Futures broker - any recommendations?

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Mr Def,
Plz dont dissapear on us.
Now, u said i made "numerous inaccurate statments" Plz show us a few?

Lets clarify the situation plz.

1, Your client had 16 long calls positions and NOT short calls, do you agree?

2. He believed that expiry was on friday and not saturday. Am i correct?

3. He also believed positions xpired OTM and NOT ITM. Am i correct?

4. He also believed that if there was any risk with positions, the broker would have notified him BEFORE friday close, especially with only $800 in account. Am i correct?

5. Do you think this would have been allowed to run and put client at risk if he used a UK broker? plz answer this truthfully, as there are many people viewing this thread. I am prepared to prove this would not have happened with a UK broker. So think b4 you answer.

6. Do you think the broker is at fault? or the client? or both?

7. Same question as number 6 but with a UK broker?

8. This question is very important to all. What is the official closing TIME and DAY for expiry on
stock.

9. If you charge ZERO commission can the company still make a profit?

10. Do you put extra margin on top of clearing house and what percentage and how is that money invested .

I /WE look forward to your reply and plz dont say visit the w-site for answers. Just give it your best shot.

And plz dont try to be smart by giving ONE general answer for all 10 question. Give one reply to each question. I'm sure most of the viewers also prefer it that way!

http://www.elitetrader.com/vb/showthread.php?threadid=51251

http://www.elitetrader.com/vb/showthread.php?threadid=53285&perpage=6&pagenumber=9

Bull
 
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the position doesn't matter and I won't talk about a specific client. It is obvious though that you can only get assigned if you are long an option.

options "officially" expire on Saturday. Brokers however have deadlines where clients can chose to exercise or lapse options. the price the OCC uses to determine automatic exercises is the official close of the stock FRIDAY.

IB's clients have all the tools available to them to electronically exercise or lapse options. I'll repeat that the automatic exercise rules are well documented.

I can't comment on UK brokers as I am not familiar with UK regulations. IB is not a full service broker, it is clear that you need one.

I'll answer your question as to whether a broker can make a profit with 0 commission. (Before answering that, I'll state that IB is one of the few firms that do not charge for exercises or assignments of options).

yes, if a broker accepts payment for order flow, it can make a profit charging 0 commission. The US exchanges have mandatory order flow payment schemes at the various exchanges. ie. the CBOE may pay X for an order routed to them and the ISE may pay Y. All brokers receive these fees. your next comment will probably say something about order flow, I'll point you again to our site which shows the SEC reports that state that other than the mandatory payment schemes of the exchanges, IB generally doesn't accept payment for order flow.

Do we put margin on top of clearing house margin: we reserve the right to but generally do not. I thought I explained that to you earlier 3 or 4 times in your last thread. example: if you put on an iron condor, you will only be charged margin for one leg of the spread as that is the maximum loss.
 
Mr Def,
your quote> " can't comment on UK brokers as I am not familiar with UK regulations. IB is not a full service broker, it is clear that you need one".
===============================================================
Dont you think it would be prudent!! if people paid a few cents more and got a broker that provides FULL SERVICE?? Is this a fair question?
Your client [developer17] LOST more $$$$ in that trade than he saved on cheap commissions?

Thanks for replying to some of my questions. You smartly ignored some important questions. I think most people are smart, they know when someone is trying to fool them. I for one am NOT easily fooled! :LOL: :cool:
But you have forgotten ONE important POINT! You said i made NUMERROUS INACCURATE STATEMENTS AND I CHALANGED YOU TO NAME A FEW! Can you plz tell us a few? Take your time! We have all the time in the world>> in the singing voice of Louis Armstrong :LOL: :cheesy:

http://www.elitetrader.com/vb/showthread.php?threadid=53285&perpage=6&pagenumber=9

Bull
 
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def said:
the position doesn't matter and I won't talk about a specific client. It is obvious though that you can only get assigned if you are long an option.

options "officially" expire on Saturday. Brokers however have deadlines where clients can chose to exercise or lapse options. the price the OCC uses to determine automatic exercises is the official close of the stock FRIDAY.

IB's clients have all the tools available to them to electronically exercise or lapse options. I'll repeat that the automatic exercise rules are well documented.

I can't comment on UK brokers as I am not familiar with UK regulations. IB is not a full service broker, it is clear that you need one.

I'll answer your question as to whether a broker can make a profit with 0 commission. (Before answering that, I'll state that IB is one of the few firms that do not charge for exercises or assignments of options).

yes, if a broker accepts payment for order flow, it can make a profit charging 0 commission. The US exchanges have mandatory order flow payment schemes at the various exchanges. ie. the CBOE may pay X for an order routed to them and the ISE may pay Y. All brokers receive these fees. your next comment will probably say something about order flow, I'll point you again to our site which shows the SEC reports that state that other than the mandatory payment schemes of the exchanges, IB generally doesn't accept payment for order flow.

Do we put margin on top of clearing house margin: we reserve the right to but generally do not. I thought I explained that to you earlier 3 or 4 times in your last thread. example: if you put on an iron condor, you will only be charged margin for one leg of the spread as that is the maximum loss.
Click to expand...
===========================================================
I have decided to display the above quote from Mr Def, just as a precaution in case he wants to delete it :LOL: :cool:
I dont think its good advert for IB? what do you guy's think?

For those of you who are confused about this discusion? Try reading posts 43-47 it may help clear up the confusion. :cool:



http://www.elitetrader.com/vb/showthread.php?threadid=53285&perpage=6&pagenumber=9

http://www.elitetrader.com/vb/showthread.php?threadid=51251

http://www.elitetrader.com/vb/showthread.php?threadid=53285&perpage=6&pagenumber=14

Quote from developer17:

I do accept that it was my fault
that I didn't inform IB about not exercising. But look at what really happened.

THe auto exercise by the OCC happened at 4:40 PM EST as per IB and my statement. Instead of liquidating me at the open on Monday, they could have gotten me out on Friday itself for a smaller loss or maybe no loss at all. They received the Auto Exercise instructions on Friday before the after hours trading closed.

Even on Monday, it got liqidated at 9:40 AM (EST) when GOOG was pretty much at the low of the day. I'm not trying to blame anyone, but to just say that IB could have more checks in place at least for Risk Management.

AS per the NASD, you cannot lose more than your initial investment in a Cash account. Why make such a claim when there can be such a exception to the rule.

07-25-05 12:08 PM

Folks,

IB moved the funds out of my other account to adjust the negative balance in the IRA.

I have had a regular trading account with IB for almost 5 years and regret ever trading with them. They have always been good in the past but treated me with cold indifference when I needed them most.

I have decided not to pursue any kind of legal action and make the lawyers rich, but have decided to share my experiences so that others can benefit from it.


THanks to eveyone for their support and valuable suggestions.
 
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You have got it so bad bulldozer.

I don't believe that your emotional control can be this weak and your trading successful.

I also don't believe that with the ego (read false pride) displays you've made at t2w that you can be a successful trader.

You really should get over it and let the rest of us enjoy life without the continuous whinging.
 
def said:
Other questions: sorry if I missed some.

IB LLC and all brokerage affiliates such as IB UK does NOT engage in proprietary trading. Income is largely derived from commissions. Timber Hill, a sister company, does engage in market making and proprietary trading. I've said it before and I'll say it again. Timber Hill in no way shape or form make any trading decisions based upon IB clients. Prices and markets are derived completely independently.

The IBG is a private company and I am not comfortable discussing specifics of income statements other than to say, commissions for IB LLC are the overwhelming driver of earnings and that 0% of IB LLC's profit was derived from proprietary trading. I know what you are asking and if you read the routing reports carefully and understand that our aim is to provide the fastest and best possible executions in the market place you'd have a level of comfort. we have a large number of institutional clients and brokers using our routing - particularly for options par.
Click to expand...

Def:
Thanks again for the reply.

So here is where I feel like there is a lack of transparency into Interactive Broker Group's business. You have IBG LLC (Interactive Brokers Group LLC) which is the parent of both IB LLC(Interactive Brokers LLC) and TH LLC (Timber Hill LLC).
IB LLC(Interactive Brokers LLC) is the brokerage arm and TH LLC (Timber Hill LLC) is basically the market maker/proprietary trading arm. This according to your latest IB LLC financial statements.

So why does a private company (not required to put out financial statements) decide to selectively put out financial statements for only 1/2 of it's business? You can easily tell me that IB LLC makes no money from proprietary trading because IBG has isolated the brokerage business and the proprietary trading divisions into two separate arms of the parent company.
The financial reports on your website show only one side of the parent company's activities. With only half of the data, I can't figure out where the majority of IBG LLC profits are made from i.e commissions or proprietary trading programs.

Does Timber Hill LLC have any public financial statements ?


All the best,

Urep
 
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bulldozer said:
1, Your client had 16 long calls positions and NOT short calls, do you agree?

2. He believed that expiry was on friday and not saturday. Am i correct?

3. He also believed positions xpired OTM and NOT ITM. Am i correct?

4. He also believed that if there was any risk with positions, the broker would have notified him BEFORE friday close, especially with only $800 in account. Am i correct?

5. Do you think this would have been allowed to run and put client at risk if he used a UK broker? plz answer this truthfully, as there are many people viewing this thread. I am prepared to prove this would not have happened with a UK broker. So think b4 you answer.

6. Do you think the broker is at fault? or the client? or both?

7. Same question as number 6 but with a UK broker?

8. This question is very important to all. What is the official closing TIME and DAY for expiry on
stock.

9. If you charge ZERO commission can the company still make a profit?

10. Do you put extra margin on top of clearing house and what percentage and how is that money invested .
Click to expand...

Bull,

I don't want to discuss the facts as I don't know them and I've the impression that all the facts out here are the story of only 1 of the parties involved. IMHO the above facts clearly indicate that at least a fair part of the blame should be allocated to the customer. Point 2,3 and 4 clearly indicate that the customer didn't inform him/herself properly before trading. I really don't understand how people can trade products without reading the product specifications and relevant broker policies. Basicly many people don't know what they're trading. Everytime I come across this kind of people I wonder do they sign contracts unseen when it comes to employment or the purchasing of their houses too?

I'm not familiar with IRA accounts as I've nothing to do with them. I've understood that IRA accounts are strongly regulated with respect to acceptable risks. This may give him an edge, I don't know. For the rest I think it's just another whiner attempting to make soem-one else pay for his own errors.

If you disagree and believe it's not the responsibilty of the customer to inform himself properly about the properties and applicable policies when trading a product I'm very curious about your argumentation.

grtnx
Wilco
 
urep said:
Def:
Thanks again for the reply.

So why does a private company (not required to put out financial statements) decide to selectively put out financial statements for only 1/2 of it's business? You can easily tell me that IB LLC makes no money from proprietary trading because IBG has isolated the brokerage business and the proprietary trading divisions into two separate arms of the parent company.
The financial reports on your website show only one side of the parent company's activities. With only half of the data, I can't figure out where the majority of IBG LLC profits are made from i.e commissions or proprietary trading programs.

Does Timber Hill LLC have any public financial statements ?


All the best,

Urep
Click to expand...

It's a good question. It is true IB LLC does not need to places it's financials on the web site. However, clients placing are placing funds with IB LLC and thus we believe they should see that the firm is in an excellent financial position. As clients do not place funds with Timber, there is no need to show the statements. However, there is an S&P report available on our site which does go into some further detail and may provide some further insight into what you are looking for.

As I mentioned, IB LLC doesn't do program trading. Clients of IB can self-direct or use SMART routing for their orders. The order are blazing fast and if you used IB for routing, you'd quickly understand that you are using a professional platform that provides professional access to the markets - ie. there is no monkey business happening with your order.
 
FatCactus said:
Can anyone recommend a futures broker which offers:

- Sterling account
- Electronic trading
- Stop losses

For reference, I've looked at:

- ODL securities (like their platform - myBroker - but it doesn't do stop losses)
- GNI touch (everything excellent - except the £200/month commission charge)
- TwoWayFutures (good - but covers too few markets)

Very grateful for any advice.
Click to expand...

www.saxobank.com
 
Why be careful of Saxo Bank? It seems there is only 1 complainant in the 2 threads listed.
 
more on Saxo (Fair or unfair criticism?)

Anonymous said:
Why be careful of Saxo Bank? It seems there is only 1 complainant in the 2 threads listed.
Click to expand...

Another from Elite Trader:

http://www.elitetrader.com/vb/showthread.php?s=&postid=791672&highlight=saxo+bank#post791672
http://www.elitetrader.com/vb/showthread.php?s=&threadid=47814

but all one can do is read the views and decide if it's simply a sore loser(s) ranting against Saxo or whether Saxo it not as good a choice as other companies. Only you can decide.
 
Between the elitetrader threads and the t2w threads, I have the impression one is trying to pull members from the other to its own site.
 
Anonymous said:
Between the elitetrader threads and the t2w threads, I have the impression one is trying to pull members from the other to its own site.
Click to expand...

I have been trading with Saxo Bank in 3 years with no problems.
 
Anon.

Baruch said:
I have been trading with Saxo Bank in 3 years with no problems.
Click to expand...

Anon - you have to realise that the detractors of Saxo Bank may be failed traders who would rather blame Saxo than look to themselves for the cause of their failures.
 
I don't use Saxo, but personally it's site looks good really.

Using a broker is more in the credit risk aspect. Anyway I don't put everything in one account with any one broker, so it doesn't really matter even if I had an account with Saxo.

I would be concerned if any of my counterparties give me bad debt problems, but that's a risk one takes after one has decided to take on the risk of trading with that counterparty.
 
Silent.Trader said:
Bull,

I don't want to discuss the facts as I don't know them and I've the impression that all the facts out here are the story of only 1 of the parties involved. IMHO the above facts clearly indicate that at least a fair part of the blame should be allocated to the customer. Point 2,3 and 4 clearly indicate that the customer didn't inform him/herself properly before trading. I really don't understand how people can trade products without reading the product specifications and relevant broker policies. Basicly many people don't know what they're trading. Everytime I come across this kind of people I wonder do they sign contracts unseen when it comes to employment or the purchasing of their houses too?

I'm not familiar with IRA accounts as I've nothing to do with them. I've understood that IRA accounts are strongly regulated with respect to acceptable risks. This may give him an edge, I don't know. For the rest I think it's just another whiner attempting to make soem-one else pay for his own errors.

If you disagree and believe it's not the responsibilty of the customer to inform himself properly about the properties and applicable policies when trading a product I'm very curious about your argumentation.

grtnx
Wilco
Click to expand...
==================================================================
Most brokers in the UK have to abide by rules set by FSA.
These rules are very strict, they can lose license if rules are broken.
One of the rules is! > the broker must always act in the best interest of the customer first and NOT the company interests. In the USA it seems the rules are the other way around :rolleyes:
Example if the customer was in hospital for any reason accident or operation etc etc and could not possibly know whats happenning with the position the brokers would have phoned him about the problem if there was NO reply and time was a major factor to position?! They would have acted to close position to close and the client would NOT have suffered a loss at all.
He had the wrong broker its that simple!! I would NOT use IB for derivatives.
 
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