It has been a little while since I last traded spot forex through IB, but this was my experience.
1. No, no historical tick backfill and their real time data is filtered compared to other brokers. Because spot forex data can vary wildly from source to source, my preference was to leave my computer running. If you use Sierra Chart with IB, which is what I recommend, then you will get 2 Second backfill from Sierra Chart, which is good enough for populating charts for discretionary trading, but not good for backtesting.
2. Not exactly sure what you mean by this, but if there is zig zagging of price then there will be zig zagging of price.
3. Spreads and fills are good during NY hours, spreads are good but limit fills are slightly worse during London hours, and I can't speak to Asian hours. Spreads do get bigger during off hours and news times. The biggest advantage will come if you are trading off-pairs.
4. You can get slippage with market orders, but during primary hours I never found it to be excessive. You get the occasional wtf, but obviously that's the nature of market orders.
A couple of other things. First, I had very frequent and scary order execution problems with NT and TWS, which is why I switched to Sierra Chart. Maybe someone else can speak as to whether this has improved or not over the past 18 months. While it has some nice features, basically TWS is a huge pile of Java Poo that you are going have to get use to eating. Second, If you trade non-usd pairs, when you exit the trade your money will be left in the other base currency, e.g. an aud/jpy trade will result you owning yen, so you will have to pay additional commissions and spreads to convert it back to USD or subject yourself to the fluctuations of that currency. This is really freaking annoying. Third, unless things have changes, federal tax treatment for currency transactions is different than futures contracts and there are certain elections that you may need to make, so do your homework on this before you start trading.
It essentially comes down to whether no restrictions on scalping, no restrictions on news trades, and not having to worry about getting screwed by your broker/dealer, e.g. stop hunted, outweigh the crappy data, commissions, problems with NT and TWS???, pos TWS, and the ridiculously stupid currency conversion requirements.
Last edited by vegasfoster; September 10th, 2012 at 10:09 AM.
The following user says Thank You to vegasfoster for this post:
In my previous post I attached an image of the zig-zagging of price I was referring to. It has occurred a few times already with the MB Trading/NT combination I have been demoing.
If I understand you correctly, if I want to run range charts with TWS/NT, then I can only capture this data in real time? And if I didn't have my computer running for 1 hr. during the day, I could not display that hour's range data?
Regarding trading non-US pairs and paying additional spreads and commissions to convert the foreign base currency back into USD, is this just the way IB handles the conversion? How do other brokers convert the foreign base currency back into USD?
What types of frequent order execution problems were you having with TWS/NT? Have these problems been resolved using Sierra Chart?
MB Trading is the absolute worst broker for providing consistent service. It's a coin toss whether their servers will fall over on daily basis or not. Last six months I don't think a week has gone past without them having some sort of technical outage - whether it is the quote servers or the order servers or logging into account management on their website or their smartphone trading app or even once when their whole phone system was out. And that's just in the last six months.
I trade during the Asia & London sessions and 95% chance that you will not get hold of their phone support during those hours. And I am not talking about staying on hold. The phones are simply not answered by anyone, they just keep ringing.
Even NY open time is not 100% for getting hold of them because they are in california and work on pacific time.
My recommendation stay the hell away. Check out LMAX if you want a good broker for forex.
The following user says Thank You to Traderji for this post:
I just got an email this week from MB Trading apologizing for an outage during the week because their Telco broke a line or something. I was experimenting with Forex with a live test account with them. My problem is that sometimes it took in excess of 6 seconds to modify an order, outrageous! I would also regularly see the market surpass my profit target by 4 or 5 ticks and come back again, and I would never get a fill.
I never had these bad experiences with Interarcive Brokers. For me the only drawback to IB is that they don't do micro lots, although you can trade the EUR/USD in 1/4 lots. I also believe you can do fractional in other pairs but they will route them differently and you will get worst spreads.
Last edited by monpere; September 20th, 2012 at 02:47 PM.
I'm another IB user for spot Forex, agree with everything vegasfoster said, use them because I have a number of other accounts with them and find the quality of service for Forex acceptable. However, in my case data/order fulfillment quality is less of issue than simple spot Forex trading know-how. May rethink IB for Forex if and when I decide they're holding me back
My sons use other brokers (e.g., Gain) mainly because they cater to smaller accounts and because they interface with NinjaTrader. In general choice of a broker/data provider is dependent on your circumstances and your personal preferences. Unfortunately the Interwebz abounds with opinion and there is no real substitute for your own experience.
ETA: Also like vegasfoster I'm currently exploring other options than the NinjaTrader/IB combo.