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Advantage Futures (www.advantagefutures.com)

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  #1 (permalink)
Italy - Tirol
 
 
Posts: 17 since Aug 2011
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can anyone help me explaining this:
Advantage futures offers so much better commissions for high volume, why no other FCM/broker can offer the same rate? Is there something wrong with AF, because all i can find out in different forums about them, are good reviews....

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  #3 (permalink)
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moarla View Post
can anyone help me explaining this:
Advantage futures offers so much better commissions for high volume, why no other FCM/broker can offer the same rate? Is there something wrong with AF, because all i can find out in different forums about them, are good reviews....

You need to take note they are not showing you the total all-in price on their website. Here are the fees they are not listing:

https://www.cmegroup.com/company/files/CME_Fee_Schedule.pdf

From a real quick look at their website, they are not cheaper than other FCM's.

As for high volume, if you are high volume then you should lease a seat and commissions become much, much, much cheaper. Once you hit 2,000 round turns a month or so I think it is beneficial to lease a seat (do your own math, this is just from memory when I last looked into it).

Even if they were cheaper, price is not everything. Make sure you continue to do your research before you open an account. The same goes for even if they are more expensive, maybe you like them a lot anyway.

BASIC Details

https://www.cftc.gov/ucm/groups/public/@financialdataforfcms/documents/file/fcmdata0611.pdf



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  #4 (permalink)
Italy - Tirol
 
 
Posts: 17 since Aug 2011
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Thanks Mike for response.
I am speaking only about commissions, NOT about CME fees.

They offer on there Volume scale after 10.000 Contracts a commission about $ 0.07.
i didnt find any other broker doing this.

they are clearing high volume, they have good funding from clients, neth capital is ok...etc.
My expirience tells me, that to be careful on exceptional deals ...

Anyone trading thrue them and willing to give me some insights?

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  #5 (permalink)
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moarla View Post
Thanks Mike for response.
I am speaking only about commissions, NOT about CME fees.

They offer on there Volume scale after 10.000 Contracts a commission about $ 0.07.
i didnt find any other broker doing this.

they are clearing high volume, they have good funding from clients, neth capital is ok...etc.
My expirience tells me, that to be careful on exceptional deals ...

Anyone trading thrue them and willing to give me some insights?

If you are trading 10,000 RT per month then why are you using their website tool to shop for an FCM? You should be leasing a seat which throws all the numbers on their website out the window. Actually, if you are trading 10,000 RT then you already own your own server co-lo'd at 350 Cermak and you'll want it to be on the same switch as your broker to minimize latency, so again why would you be looking at a website like this.

Have you called them and talked to them on the phone?

Do they open accounts in your country?

If you are in Europe, do they have European gateway servers?

What backend are they using? What data feed?

Have you looked at their statement services and online customer portals?

Do they have fees for cutting checks?

Have you tried calling them at 3:00AM as a pretend live customer with a live position on, to test their order desk wait times?

Once you do all these things, come back here and give us the report on how they are.

If someone else on futures.io (formerly BMT) is using them, hopefully they can reply to your thread and share their experiences.

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  #6 (permalink)
Italy - Tirol
 
 
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-They open account for my country
- talked to them on phone
- they have one of the best TT architecture, access point in frankfurt
- they are feed neutral, so you can use TT, CQG, T4 and other feeds/frontends
- fees for checks dont care about

final question: what has a seat on CME to do with commissions? can i have both?
so, i have a leased seat, but i would like to change my trading frontend, which my actual broker doesnt offer, so i came out to find Advantage (also Velocity Vision and others)

- i dont need a colocated server i trade manualy and i dont scalp, i trade bigger swings with HIGH volume, but they offer also collocated server (but NO NEED)

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  #7 (permalink)
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moarla View Post
final question: what has a seat on CME to do with commissions?

Leasing a seat will dramatically change your all-in expenses. I only think all-in, not just commission, as commission-only is like only calculating how much gas costs without calculating the cost of buying the car

Just call your broker and have them walk you through how to lease a seat. And yes, your seat is valid with any broker, it is not tied to one broker.

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  #8 (permalink)
Italy - Tirol
 
 
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Big Mike View Post
Leasing a seat will dramatically change your all-in expenses. I only think all-in, not just commission, as commission-only is like only calculating how much gas costs without calculating the cost of buying the car

Just call your broker and have them walk you through how to lease a seat. And yes, your seat is valid with any broker, it is not tied to one broker.

Mike

i HAVE a seat...
i am searching broker with CQG or X-Trader or Rithmic, so i found also AF. My only question is, why they are the only one with such nice commissions. is there anything wrong with them? please dont educate me, no need for it.
If anyone here is clearing with AF, please share your expirience....

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  #9 (permalink)
Oslo, Norway
 
Experience: Advanced
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They are indeed extremely cheap for high volume traders, but they are also a solid company. They are more focused on professionals, which you can see from their platform offerings, and high volume individuals.

I have nothing but good things to say about them!

Other alternatives would be Crossland LLC or Variance Futures' (IB for Vision) "Institutional Account".

But with your size, you might want to check out NewEdge (or some of the other usual suspects on the institutional level).

If you want to trade using CQG, you can see a list of their trading partners here:
Trade with FCM Partners

But I digress... I've found Advantage to be excellent, and you have nothing to worry about!

Do a search on ET, there have been several positive postings about them over the years..

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  #10 (permalink)
 
 
Posts: 1,176 since Nov 2009



moarla View Post
can anyone help me explaining this:
Advantage futures offers so much better commissions for high volume, why no other FCM/broker can offer the same rate? Is there something wrong with AF, because all i can find out in different forums about them, are good reviews....

Advantage handles high volume(~200M+ cars per year), and their pricing model is based on how much $$$ you pay in comms, not how many RT you can make... that is the reason why they can afford to offer you low comms... see below to compare to what they quoted you, this is what I was quoted in Dec 2010.

Their setup with CQG and TT is excellent, technology wise, they are above most of ther FCM's on this forum that most small retail talks about... my only complaint is their account management platform as it is rather difficult to use, but at the same time... as long as you get the daily P&L pdf's, who really cares... besides that, they have over $450MM in customer assets, and their excess cash is about 1.4% if I recall. Keep in mind that with Adv you are one of thousands, not one of hundreds...as with most FCM's being discussed on this forum as well...

The only other guys that were willing to come close to Advantage were Crossland for me... and I went with them because I liked working with Ed Hague... and also because I could not always guarantee I would do 1100RT per day, if I was home I would do that, but if I was at work I would only do 100 or less or none at all ... so now that I cant be home as much I am glad I did it the way I did since I still leveraged the quote from Adv to get better pricing from Crossland...

btw, you dont mention what you trade... but if you focus on energy... you should look at MBFCC ... that would be another high volume FCM for that specific market.. and you can do options on all energies as well...

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  #11 (permalink)
 
 
Posts: 1,176 since Nov 2009


moarla View Post
final question: what has a seat on CME to do with commissions? can i have both?

you can have both, yes... having a seat is a personal choice.. it comes down to what is your privacy worth... I personally opt for privacy...

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  #12 (permalink)
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International Incentive Programs

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  #13 (permalink)
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Big Mike View Post
You need to take note they are not showing you the total all-in price on their website. Here are the fees they are not listing:

https://www.cmegroup.com/company/files/CME_Fee_Schedule.pdf

From a real quick look at their website, they are not cheaper than other FCM's.

As for high volume, if you are high volume then you should lease a seat and commissions become much, much, much cheaper. Once you hit 2,000 round turns a month or so I think it is beneficial to lease a seat (do your own math, this is just from memory when I last looked into it).

Even if they were cheaper, price is not everything. Make sure you continue to do your research before you open an account. The same goes for even if they are more expensive, maybe you like them a lot anyway.

BASIC Details

https://www.cftc.gov/ucm/groups/public/@financialdataforfcms/documents/file/fcmdata0611.pdf



Mike

CME offers a special category of direct member called ECN Member

look that up on their website,

however that only applies to their products, not the ICE or other exchanges and is more formal than leasing through an established member

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  #14 (permalink)
Italy - Tirol
 
 
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i am new on this forum, but i must say, i get alreddy good and helpful answers. tks all

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  #15 (permalink)
Ireland
 
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Hi folks

I am trying to find a reliable broker to trade the FDAX and preferrably in Strassburg or better in Frankfurt.

Considering Advantage.

Anyone got any further comment on AF?

Cheers..

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  #16 (permalink)
Italy - Tirol
 
 
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they have a server for XTRADER in Frankfurt.

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  #17 (permalink)
Legendary Bought TSLA at 880
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I talked to these guys the other day and they're offering a pretty competitive rate, might be the way to go if that's what you're looking for. My guys will like to know more about them in other ways as we're afraid to start an account that could form 5-10% of their customer equity, so if you guys have been with them:

1. How does their back-office reporting capability compare to other FCMs?

2. How responsive is their trade desk in handling orders and requests over the phone?

3. Any idea how do they handle their unencumbered cash balances?

4. What about their tech expertise?

5. What's the biggest problem that you've had with them?

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  #18 (permalink)
Rio de Janeiro, Brazil
 
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artemiso View Post
I talked to these guys the other day and they're offering a pretty competitive rate, might be the way to go if that's what you're looking for. My guys will like to know more about them in other ways as we're afraid to start an account that could form 5-10% of their customer equity, so if you guys have been with them:

1. How does their back-office reporting capability compare to other FCMs?

2. How responsive is their trade desk in handling orders and requests over the phone?

3. Any idea how do they handle their unencumbered cash balances?

4. What about their tech expertise?

5. What's the biggest problem that you've had with them?

I cant answer some of these, at least probably not to the level you are looking for but I was with them for 4 years and they were the best clearing firm hands down. My old prop shop had no loyalty and switched literally every 4-5 months for a few years trying to shave a penny off rates so i have experience with tons- fortis, goldman, MF etc, and when i went out on my own i chose them because net net i had virtually zero problems. Tech is top notch and their support is extremely responsive. Nirm and ambaj really keep that tech dept. on top of things. I never even had to call the trade desk because i never got caught with a position on the few times they went down. I have traded in their office next to their brokers though and they are good dudes who seem to do great work.

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  #19 (permalink)
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Profiler View Post
I cant answer some of these, at least probably not to the level you are looking for but I was with them for 4 years and they were the best clearing firm hands down. My old prop shop had no loyalty and switched literally every 4-5 months for a few years trying to shave a penny off rates so i have experience with tons- fortis, goldman, MF etc, and when i went out on my own i chose them because net net i had virtually zero problems. Tech is top notch and their support is extremely responsive. Nirm and ambaj really keep that tech dept. on top of things. I never even had to call the trade desk because i never got caught with a position on the few times they went down. I have traded in their office next to their brokers though and they are good dudes who seem to do great work.

Wow, thanks for your reply, really confirms some of my thoughts. Are you still with them?

Goldman is good but the problem is that they have no incentive to compete down their clearing fees: we have to hit 4% in CME daily volume to get to the next tier in clearing fee.

I share your opinion about Nirm - definitely one of the top guys in Chicago even if compared among the bigger primes.

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  #20 (permalink)
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artemiso View Post
Wow, thanks for your reply, really confirms some of my thoughts. Are you still with them?

Goldman is good but the problem is that they have no incentive to compete down their clearing fees: we have to hit 4% in CME daily volume to get to the next tier in clearing fee.

I share your opinion about Nirm - definitely one of the top guys in Chicago even if compared among the bigger primes.

my account is still open there but its dormant since my scalping game went the way of the dodo last year and i joined FT71s brokerage which clears through OEC in order to be in his chat room and learn about volume profiling and its only right to pay the man some commish.

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  #21 (permalink)
Legendary Bought TSLA at 880
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my account is still open there but its dormant since my scalping game went the way of the dodo last year and i joined FT71s brokerage which clears through OEC in order to be in his chat room and learn about volume profiling and its only right to pay the man some commish.

I see - thanks for sharing so much, I owe you a beer.

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  #22 (permalink)
Legendary Market Wizard
Houston, TX
 
Experience: Advanced
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I've been clearing through Advantage for almost 5 years. Feel free to PM if you have any questions or need contacts within their organization. Advantage are NOT a small time retail clearer, these guys are a very high volume excection shop. Their back office & operations are excellent and their IT support is even better. I've never used their 24hr trade desk so have no idea what they are like, but if they are anything like the rest of Advantage they will be excellent. (They also have 24hr IT support which I have used and they are excellent).

The rates advertised on their website (as low as 7c per side on >500 lots a day Advantage Commission Calculator) are real, and reflect their clearing cost to you. These obviously do not include exchange fees. They are probably as low as you will find anywhere unless you are HFT or Institutional and moving 'extreme' size. There are no extra's. Your all in rate is exchange fees + your negotiated Advantage rate. And yes, repeating the obvious, exchange fees are lower if you lease a seat. So as a NYMEX trader with a leased seat trading CL and NG your day trade rate could be as low as 62c/side (55c exchange + Advantage Clearing Fee.)

Advantage are technology agnostic, they offer CQG, OptionsCity, ORC, RTS, and Trading Technologies (TT) among others. They are also a hosted technology solutions provider though, so its very easy to have your co-located software running on a server in their space, co-located next to the exchange. This does have a cost though, but you get what you pay for.

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  #23 (permalink)
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I'm currently considering switching to Advantage, overall impression thus far from the website is that these people are serious professional people.

"The primary thing required to obtain what you want from life, is simply the will to pursue it, and the faith to believe it is possible." - Author Unknown

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  #24 (permalink)
Legendary Market Wizard
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PositiveDeviant View Post
I'm currently considering switching to Advantage, overall impression thus far from the website is that these people are very professional.

The CFTC publish FCM financial data monthly so you can compare FCMs not just by the amount of customer segregated funds they hold but also by their own financial data such as adjusted net capital, excess capital etc.

https://www.cftc.gov/ucm/groups/public/@financialdataforfcms/documents/file/fcmdata1013.pdf

Very true. Not Advantage specific, but one thing to remember though is that margins are normally based upon positions held overnight and not intraday. Hence while a report like this may be a good measure of financial health in some aspects, it isnt a good measure of volume activity or many other clearing metrics. When you look at some of those huge numbers for the Bank FCM you have to realize that their is bank lending often associated with that and that these are often long term positions. (Think about the margin requirements for a NYMEX local or day trader vs an Oil Producer hedging a 5 year production well. The local/day trader probably has significantly higher volume that requires little to no margin, while the producer has low volume that requires significant margin support). Finally while I suspect an accurate audited report like this would have caught PFG long before they went under, I wonder whether it caught MF Global.

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  #25 (permalink)
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You might want to take a look at this Case Information

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  #26 (permalink)
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my account is still open there but its dormant since my scalping game went the way of the dodo last year and i joined FT71s brokerage which clears through OEC in order to be in his chat room and learn about volume profiling and its only right to pay the man some commish.

By the way, I just remembered to follow up on this. We decided not to engage them because their main value-add (their IT department) left somewhere late last year to form Nirvana. That left Crossland the only decent player in the space for a while, but they just got acquired by Wedbush last month.

I'd say all semi-professional traders with <$5M account sizes are now stuck with retail brokerages, trading agreements in a fund structure, or a few boutique, institutional introducing brokers that aren't exactly focused on electronic trading. It has never been more difficult to get started in this industry.

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  #27 (permalink)
Legendary Market Wizard
Houston, TX
 
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artemiso View Post
By the way, I just remembered to follow up on this. We decided not to engage them because their main value-add (their IT department) left somewhere late last year to form Nirvana.

WOW that's a little bit of an exaggeration. Did they lose 2 of their senior IT staff - yes. Did they lose 2 of their longest tenured IT staff - yes. The two that left were definitely excellent at what they did, but this didn't decimate their IT department like you imply. They have a large IT group and they still have the same very reliable trading environment. I suspect the average client is unaware of the change and hasn't noticed any change.


artemiso View Post
I'd say all semi-professional traders with <$5M account sizes are now stuck with retail brokerages

Maybe obvious from my earlier comments but I think Advantage still offer a great solution for people looking for colocated trading solutions.

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  #28 (permalink)
Legendary Bought TSLA at 880
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SMCJB View Post
WOW that's a little bit of an exaggeration. Did they lose 2 of their senior IT staff - yes. Did they lose 2 of their longest tenured IT staff - yes. The two that left were definitely excellent at what they did, but this didn't decimate their IT department like you imply. They have a large IT group and they still have the same very reliable trading environment. I suspect the average client is unaware of the change and hasn't noticed any change.

I just read my post again and it does seem much more heavily-toned than I realized while I was writing it. With the benefit of a few hours of sleep now, I have to say that your description sounds much more accurate. To me though, those were the most important reason to pick Advantage.



SMCJB View Post
Maybe obvious from my earlier comments but I think Advantage still offer a great solution for people looking for colocated trading solutions.

Hm, I would say that Advantage's colocation services offer no marginal value-add over any other FCM at this point. KCG will have a lower price point and better technical expertise, and they would be accessible through a few boutique introducing brokers. I think the main value-add of Advantage is now their clearing for CBOE.

I have some conflict of interest here because I work with them on certain things, but I'd say that Jefferies is probably a good replacement for what Advantage used to be good at - stronger financials, a more experienced team on the trading/execution side, and a decent/comparable team on the IT side. Jefferies is also "technology-agnostic" as you word it.

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  #29 (permalink)
Chicago Illinois
 
 
Posts: 26 since Mar 2014
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Advantage has been and continues to be a very good firm. They don't prop trade and they clear many professionals that do this for a living. Very good and well-deserved reputation. They also clear many HF's that don't want to go the Bank route just yet.

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  #30 (permalink)
La Massana, Andorra
 
Experience: Advanced
Platform: Sierra Chart + JForex
Broker: Stage 5 Trading (Advantage Futures) / Dukascopy / Darwinex / Interactive Brokers / OANDA
Trading: Futures
 
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Posts: 37 since Jul 2020
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Besides Sierra Brokers, is there any alternate Introducing Broker known for the FCM Advantage Futures ?

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  #31 (permalink)
La Massana, Andorra
 
Experience: Advanced
Platform: Sierra Chart + JForex
Broker: Stage 5 Trading (Advantage Futures) / Dukascopy / Darwinex / Interactive Brokers / OANDA
Trading: Futures
 
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Posts: 37 since Jul 2020
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Viro Major View Post
Besides Sierra Brokers, is there any alternate Introducing Broker known for the FCM Advantage Futures ?

Apparently, there’s Stage 5 Trading. Optimus ?
Who else ?

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  #32 (permalink)
La Massana, Andorra
 
Experience: Advanced
Platform: Sierra Chart + JForex
Broker: Stage 5 Trading (Advantage Futures) / Dukascopy / Darwinex / Interactive Brokers / OANDA
Trading: Futures
 
Viro Major's Avatar
 
Posts: 37 since Jul 2020
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Apparently, Advantage Futures applies negative interest rates on EUR balances, starting from the first dime, so unlike Interactive Brokers, which exempts them below 100k.
Is the reference rate the 1 month EUR LIBOR ? How much mark-up over it ?

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  #33 (permalink)
Legendary Market Wizard
Houston, TX
 
Experience: Advanced
Platform: Trading Technologies
Broker: Primary Advantage Futures. Also ED&F and Tradestation
Trading: Primarily Energy but also a little ES, GE, GC, SI & Bitcoin
 
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Viro Major View Post
Apparently, Advantage Futures applies negative interest rates on EUR balances, starting from the first dime, so unlike Interactive Brokers, which exempts them below 100k.
Is the reference rate the 1 month EUR LIBOR ? How much mark-up over it ?

EUR interest rates are negative but must admit that would be really annoying. I'm very surprised Interactive are giving people the break they are. Probably worried about losing smaller European customers.

Here's an interesting look at how Interactive Brokers make money on currency trading and interest rates. If you buy USD sell EUR, they will pay you 0% on the USD deposit and charge you 1.5% on the EUR margin, hence the trade has a 1.5% carry cost. If you sell USD buy EUR, they charge you 1.6% on the USD margin and pay you 0% on the EUR deposit, hence the trade has a 1.6% carry cost. So there's a 1.5% carry cost no matter whether you buy or sell. Great business to be in. Now lets assume your a big swinger and have the position on for $250,000. If you sell USD buy EUR, they charge you 1.1% on the USD margin and also charge you 0.84% on the EUR deposit, hence the trade has a 1.94% carry cost which is even higher than for smaller positions. Inverse discount for trading size! If you do the same calculation for the Indian Rupee there's a 1.6% carry cost buying INR vs USD and a 12.1% selling the INR. Nice 13.7% interest spread! I guess the advertising slogan "Our bid-ask is only a quarter of a pip but we charge exorbitant carry costs" wouldn't generate much business. Sorry for getting off topic. References...

https://www.interactivebrokers.com/en/index.php?f=46376
https://www.interactivebrokers.com/en/index.php?f=46385

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