If using NinjaTrader as your front-end to IB, you should also be aware that even minute data on your charts can be suspect. IB bundles ticks, and sometimes this results in an incorrect/missed High and/or Low of the bar being displayed in NinjaTrader. IB has provided a "seconds" update call in their API to "fix" their problem of losing the H/L tick on a bar, but AFAIK it is not implemented in NT7. If you run 2 identical minute charts during the day, then refresh one of them at the end of day (which would draw data from their historical database with it's corrected bars), you will see differences in some of the bar highs and lows. This obviously only matters as much as you think it does in your strategies.
Though I disagree that IB's data feed isn't 'good enough' to trade on, factoring in my belief that the short term data precision that some traders try and assign to the market over the long term is an illusion, I really appreciate the research you've done with IB as it relates to all of the financials.
For myself, IB is mysterious enough (and filled with high frequency players who would be more impacted during a market meltdown, thus affecting the overall pool) to me where I've pulled a lot of funds out of there over the last year or so, to the point where I have just enough there to play around with with a few futures contracts. I love the executions, commissions, products available (though not some of the extra data fees) with IB but that has to take a back seat. I miss my $1 commissions for 200 shares.
Bigger brokers providing FDIC cash sweeps and more 'buy and hold' investors as clients, that I am fairly comfortable with, are TD/TOS and Fidelity.
All good points. A couple of items to mention though. You shouldn't compare MF to IB. MF's prop trading was in the entity as the brokerage. IB brokerage has stated they don't trade prop and list the investments they make on their site so while that is not fool proof, it is certainly more than other firms have stated. I think I've done the best homework I could on IB and believe they are amongst the safest brokers in the US.
As an aside, I'm glad you've made these points as it gives me a good excuse to re-read or search the IB site to confirm my previous research. From what I understand, MF lost track of funds (for lack of a better phrase) during the week and when then when they ran their segregation report at weeks end, things didn't add up.
As an example, this is what you'll find if do a search on segregation on their site:
In addition to the safeguards afforded through segregation, IB employs a number of policies and practices which serve to enhance the safety and security of accounts beyond that outlined above. These include the following:
- IB computes its securities segregation or reserve requirement on a daily rather than weekly basis as allowed by regulation, thereby ensuring timely determination as to the amount required to be reserved and the deposit of funds necessary to satisfy the requirement.
- IBís does not avail itself of the generally more permissive rules with respect to the investment of commodity customer cash balances. These balances are instead invested in a manner similar to that of securities cash balances (i.e., U.S. government securities) with the exception of an occasional investment in money market funds."
I'm not going to go over each of your points but one more stands out that I disagree heartedly with. I love the fact that the majority owner has around 90% of this company is locked up with management (and 90% of that is with the founder). Take a guy like Corzine, outside of reputation, he didn't take a huge financial hit swinging for the fences. However, at IB, if they took silly risks, they stand to lose all the wealth accumulated over the past 30 years. I figure, that they will take better care of their money than mine and as long as their money is within the firm, then I expect conservative risk. Listen in to the earnings calls and you'll see what I mean in regards to risk.
"Mysterious" is the word. The problem with any organization is you never really know what goes on behind the scenes until it's often too late.
I did some CFO contracting for a few large publicly listed organizations and was surprised at how poorly run some of them were and their lax financial controls. Their annual reports looked nice and glossy though and their websites were full of warm and fuzzy statements which in some cases were totally false.
My conclusions are the same as yours in respect of Fidelity and TD.
What continues to surprise me is how some people still don't take this issue seriously. You have traders who exercise prudent risk management only risking so much % per trade etc but then have their entire account at a single broker. I heard there were people who had 100% of their funds with MF Global and lost that. Then they opened an account with PFG and put 100% of their funds into that. Who cares about saving a $1 in commissions when you have your entire account exposed.
Last edited by djkiwi; December 18th, 2012 at 11:49 PM.
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Does anyone have new update on IB's data feed being upgraded to meet the futures trading needs or it's still the same.
Also, any 3rd party data feed recommendation? I was thinking of Kinetic using Ninjatrader.
May I ask how much you are paying now for Kinetic?
I understand it's $55 per month but from their web site it shows exchange fee to be extra such as $46 for CME-mini.
So does that mean it's $101 per month for data fee and exchange fee?
Favorite Futures: US Equities, US Options, ETFs, Commodities, EUR/USD
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Statement Errors with Interactive Brokers
Hello I have been using IB for over 2 years and I have found Statements Errors.
I did over 20 trades last year and I have found errors on the statements. IB confirmed those errors which they fix. But both of the times I was the one pointing out the errors. I have imagine the difficulty of finding errors in the official monthly statements with some many trades.
Have any of you experienced Statements errors?
1. Charged me hundreds of follar for inactivity fee which was not true.
2. Performance fee calculation for an Advisor Account.
I am thinking so change because of those errors. I cant understand how they made those errors.