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CME Fee changes 2014, significant impact
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CME Fee changes 2014, significant impact

  #71 (permalink)
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Fee increase

I get the feeling that they(CME) know, no matter what fee increase they put out, there will be an uproar. So they put out the worst case scenario first and survive the initial sh*tstorm. Then, if they back off even half way, they are still ahead and the customer will let out a sigh of relief knowing it could have been worse. At that point many will live with it.


Last edited by Fritzk; December 4th, 2013 at 01:47 PM. Reason: spelling
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  #72 (permalink)
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Fritzk View Post
I get the feeling that they(CME) know, no matter what fee increase they put out, there will be an uproar. So they put out the worst case scenario first and survive the initial sh*tstorm. Then, if they back off even half way, they are still ahead and the customer will let out a sigh of relief knowing it could have been worse. At that point many will live with it.

They have a monopoly and tell me some alternatives?

CME is way to big.

If you are focused on futures, you will have no chance avoiding CME. CME has on almost every product the highest liquidity.

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  #73 (permalink)
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Big Mike View Post
HFT of this type is primarily an equities market phenomenon and wouldn't be affected by this CME change in the futures market.

Mike

Your right,... still, HFT's make up 60% of all CME volume. Thats why they targeted them in their rate changes. If the 40% who are left is reduced who are the HFT's going to feed off of? Somebody is going to lose regardless.

Robert

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  #74 (permalink)
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Great information, like many others here Id like to thank Mike for getting this upfront so we can be forewarned and ready to rethink our costs.
I don't say much, I read a lot!

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  #75 (permalink)
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Jura View Post
@Robert Carrillo, can you share the logic behind your comment here? As I understand this thread, trading from a Corp/LLC is only a subset of the fee increase.

Since you did not address Mike's other questions, can I read that as you are waiting for confirmation from CME and/or do not think retail traders will see different fees?

----

Btw, I'm wondering why I, as an IQFeed customer, had to read this on futures.io (formerly BMT) and not receive an e-mail communication from IQFeed regarding new fees. Is there perhaps an internet page to register for such an e-mail communication? (Yes, I checked my spam folder ).

----

Furthermore, I see that IQFeed raises the CME fees with the +/- 15 dollar per exchange per 1 January for both professional and non-professional:

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Source.

(So as Mike said, that would be $15 additional fees per exchange, per platform, per data feed, per month.)

But the CME waiver fee page has not changed, so the waiver fee is still continued?

And, is this fee increase related to CME's fee increase or not? I'm asking since, again, I was not informed by IQFeed about these new fees, so for all I know these new fees per 1 January might have been posted on that page before CME communicated the new fees.

Thanks in advance for clearing these things up.

Hi Jura,

On Monday, I saw the email we are sending to all IQFeed/DTN.IQ customers regarding improvements made during 2013 and 2014 pricing. It will be emailed this week. We always send this letter during the first week of Dec (along with changing prices on our site to reflect 2014), and this year is no different.

First couple paragraphs from it:


Quoting 
Dear DTN.IQ/IQFeed Customer,

Below you will find information regarding price and service changes to DTN.IQ/IQFeed effective January 1, 2014.

We also received notice from several exchanges regarding fee changes for 2014. Because these changes impact each customer differently, please visit our website Welcome to DTN IQFeed! - Fast, Reliable, Affordable. Market Data and API's. and click on ďfeesĒ to view the updated fees.

What is different is that CME Group is raising fees and stopping the waivers program. It's been in the news since Nov 12,

CME Group hikes transaction fees for 2014 | Reuters

and the RCG letter to CME was referenced on Nov 19,

CME Group digs in on fee increases as brokers protest | Reuters.

The reason we didnít send communication to our customers or comment on forums is because there are multiple moving pieces and we donít want to provide inaccurate info while we gather more details. You all know I like to have the facts straight before commenting. Conjecture and rumors don't help anybody.

It's important to remember that for traders with waivers, this is a non-issue until Jan 2015. You will keep your waivers through 2014, and that is true for anybody who gets waivers prior to Mar 1, 2014.

We received the Pro/Non-Pro rules from CME today. They reflect the rules Mike posted from CME, with no mention of Corp/LLC, but we are asking for clarification on that since the RCG letter mentioned it . We'll advise as soon as we know more.

Regarding the IQFeed site showing $91/mo for CME Group Non-Pro's, that won't matter until Jan 2015. It will be updated well prior to that to reflect the lower rate. I learned in a meeting about this earlier today, that in order to qualify as a Non-Pro, you not only need to answer "No" to all the questions on the CME Group form, but you also have to be qualified as for the old waivers program. Assuming you still have waivers come Jan 1, 2015, and have answered the CME form as a Non-Pro, you will get the lower Non-Pro rates eff Jan 1.

Since one needs to "qualify for waivers" to be a Non-Pro after Jan 2015, the CME Group Waivers page on the IQFeed site will remain but be changed to reflect "CME Group Non-Pro Qualification" page or something to that effect. The same steps will be required but for a different purpose. Instead of brokers verifying funded accounts to permit waivers, it will be to permit Non-Pro status.

This is a big transition for all of us, and we will continue to keep everybody informed with facts as we get them.

Thanks.

Robert

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  #76 (permalink)
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Silver Dragon View Post
Your right,... still, HFT's make up 60% of all CME volume. Thats why they targeted them in their rate changes. If the 40% who are left is reduced who are the HFT's going to feed off of? Somebody is going to lose regardless.

Robert

Algorithmic, or HFT? Big difference. I figured algorithmic was more like 80%, but definitely not HFT. Honestly I could be way off, I don't really focus on that.

Mike

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  #77 (permalink)
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Big Mike View Post
Algorithmic, or HFT? Big difference. I figured algorithmic was more like 80%, but definitely not HFT. Honestly I could be way off, I don't really focus on that.

Mike

I am not sure on the algo vs HFT.. to me they are the same. In the article below they refer to HFT trading in milliseconds and microseconds. This has to be Algo to trade this way.

Robert

High-Speed Traders Exploit Loophole - WSJ.com


Quoting 
The Chicago Mercantile Exchange, a unit of CME Group Inc., is the largest U.S. futures exchange, handling 12.5 million contracts a day on average in the first quarter, according to Sandler + O'Neill Partners L.P. High-frequency trading generated about 61% of all futures-market volume, up from 47% in 2008, according to Tabb Group.


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  #78 (permalink)
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Balanar View Post
They have a monopoly and tell me some alternatives?

CME is way to big.

If you are focused on futures, you will have no chance avoiding CME. CME has on almost every product the highest liquidity.

The Intercontinental Exchange (ICE), but they don't have the more popular contracts people like to trade on CME, maybe ICE will become more popular.

https://www.theice.com/productguide/Search.shtml?productGuide=&advancedKeyword=&...S.&contractTypes=Futures

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  #79 (permalink)
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Silver Dragon View Post
I am not sure on the algo vs HFT.. to me they are the same. In the article below they refer to HFT trading in milliseconds and microseconds. This has to be Algo to trade this way.

Robert

High-Speed Traders Exploit Loophole - WSJ.com

Not the same. Most executions are algorithmic, but it has nothing to do with high frequency or low latency. It has to do with the banks and firms wanting to get the best price for their clients so they use sophisticated formulas instead of just dumping big volume when an order comes in.

I cannot think of any article that reliably has facts that really break it down by a profit center, firms that make their money on algo trading vs HFT trading.

Mike

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  #80 (permalink)
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Silver Dragon View Post
I am not sure on the algo vs HFT.. to me they are the same.

Some quick links to explain it better than I could.

Algorithmic Trading is Not High Frequency Trading

Risk from High Frequency and Algorithmic Trading Not as Big as Many Think - Seeking Alpha

The difference between automated, algorithmic and high-frequency trading | Ash Booth

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