Which broker: TradeStation or Interactive Brokers?

Hello,

I have been trading US stocks for the past several months with a broker that is charging $9.95 commission. I need to get into a cheaper commission structure—i.e. penny a share or similar. As I live in the UK, I am limited to companies that offer UK-based accounts. So far I have only found two brokers that offer per-share pricing in the UK: TradeStation and Interactive Brokers. I’m looking for advice as to which company to chose for US equity trading.

Thanks,

--Jack

Well one issue here (unless it has recently changed) is that IB will allow you to open an account and keep the base currency in GBP which was not an option with Tradestation. In view of the increasing, and likely to continue, pressure on the USD I would go for IB otherwise you are likely to find your account declining in value when converting back to GBP.

That said if you want a good charting facility and with all the other features that you get with Tradestation then that would be worth considering. IB have poor customer service in certain aspects but when it is working then it works well.

I sound like I am arguing both sides here but actually it is all down to what your main requirements are and in a straight choice I would still go for IB


Paul

trader.jack said:

Hello,

I have been trading US stocks for the past several months with a broker that is charging $9.95 commission. I need to get into a cheaper commission structure—i.e. penny a share or similar. As I live in the UK, I am limited to companies that offer UK-based accounts. So far I have only found two brokers that offer per-share pricing in the UK: TradeStation and Interactive Brokers. I’m looking for advice as to which company to chose for US equity trading.

Thanks,

--Jack

Click to expand...

I can't comment on TradeStation, because I don't use it. I use IB and would agree with pretty well everything that Paul said. I have never had issues with customer service, but I have heard the tales of others. I don't use their charting for my main analysis, but use their API to link into 3rd party software. Their education is fairly good with archived online seminars as well as live London seminars, but then it needs to be to get to grips with the hundreds of setup options on TWS. However once you have worked through how you want to set it up then it will be well-adapted to your needs. They have an extensive range of order types and plenty of documentation on their site explainng these, in advance of opening an account.

They have a universal account that allows flexibility in trading in many different types of instruments and currencies. For FX though, I think their platform is not as ideal as FX-specific brokers.

I use them primarily for US equities.

Charlton

I think their platform is not as ideal as FX-specific brokers.

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Charlton,

What makes you think this ?


Paul

Trader333 said:

Charlton,

What makes you think this ?


Paul

Click to expand...

I found it "clunky" - not very scientific I know, but I found that forex brokers had trading platforms that were clearer to use and especially suitable for clearly displaying currency pairs.

IB seemed to try to adapt their platform, good for equities, options etc, to currencies, rather than design additional screens particularly aimed at this area.

I haven't look at the FX side on TWS recently and I know they have been putting work into this area, so it may have improved since then.

Do you use TWS and, if so, how are you finding it and how does it compare to FX-specific brokers

So in summary it is the design rather than functionality that I found lacking

Charlton

Charlton,

Re IB and your use of third-party software. Presumably, you could use IB’s system simply for execution but use prices and charting from elsewhere? And isn’t the case various front-ends can be used – X-Trader, etc. Out of curiosity, what other software do you use in conjunction with IB?

Grant.

IB seemed to try to adapt their platform, good for equities, options etc, to currencies, rather than design additional screens particularly aimed at this area.

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The screens for FX on IB are quite good and I will post a screenshot on Tuesday. I cannot comment on other FX specific brokers but what I will say is that I would only use a DA broker so that limits my choice dramatically to only a very few and I find IB good so far.


Paul

grantx said:

Charlton,

Re IB and your use of third-party software. Presumably, you could use IB’s system simply for execution but use prices and charting from elsewhere? And isn’t the case various front-ends can be used – X-Trader, etc. Out of curiosity, what other software do you use in conjunction with IB?

Grant.

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That is correct. The Application Programming Interface is a 2 way street. You can use external data-feeds into IB. You can interface to a charting program or to other software e.g. for accounting.

I you go to IB's site and click on the software dropdown menu, then third-party tools you can see the type of applications. YOu can also look at the manuals/guides under the software menu >FIX/API. If you also look at the API software option in the menu you can see how to interface to/from common applications such as Excel.

If you already have IB the excel option is a good one to "play with" initially and it will work with the paper trading account as well as the live one.

Personally I use the API in a very simple way, which is in conjunction with the charting and back-testing software Amibroker, so it is purely a feed outwards for me, as I subscribe to IB's own datafeeds, which in turn come direct from the markets. I use Amibroker because it has a fairly comprehensive programming language (AFL) and its manuals are freely available on their site, so you can see what I mean. However I do not use indicators and am a discretionary trader, so I don't use Amibroker to create orders, although it can do so.

I don' t use a front-end such as Button Trader and am quite happy with TWS as a platform.

Perhaps others who use other tools with IB's API could mention how they use it.

Charlton

Trader333 said:

The screens for FX on IB are quite good and I will post a screenshot on Tuesday. I cannot comment on other FX specific brokers but what I will say is that I would only use a DA broker so that limits my choice dramatically to only a very few and I find IB good so far.


Paul

Click to expand...

I will be interested to see that and hopefully reassess my views. Would you be so good as to mention any improvements you might like to see (if any) as well on Tuesday.

Charlton

Charlton,

Thank you for the info.

Grant.

Here is the IB FX screenshot which is fine for my needs. With IB you can also trade straight off the chart which I have never used but suits some people.


Paul

IB and FX

Trader333 said:

Here is the IB FX screenshot which is fine for my needs. With IB you can also trade straight off the chart which I have never used but suits some people.


Paul

Click to expand...

Yes agreed - I stand corrected. This is much more like the offerings of the FX brokers. When I was last looking into this trading from the chart was, if memory serves me correctly, not so easy for FX with IB.

I will devote some time into experimenting with this in IB, as you have demonstrated it is worth reconsidering them for my FX side.

Thanks for the information

Charlton

TWS n IB

hi there,
e msg on board on TWS n IB is well info for me as i m deciding tws or IB. i like to know, if anyone can offer more info on TWS. recently, i was introduce to 2 provider on tws. e tws is base on blue n red chart that seems help spot entry n exit opportuties. 1 "direct" contact fr state provide 10 days trail n if to continue thereafter need pay 1 time - life fee of usd15500 to hv right to use tws with e blue&red charting with their fibt3 etc formula etc! n another yet know detail but if proceed with e tws n their brokerage package then e tws may b "free" to use with small monthly fee n e blue&red charting.

anyone hv more idea of this blue & red charting? i m somewhat a little confuse. as some trader seminar i attend didn't provide possible comments but on e other hand, as they provide their own training program...so...not sure ....

any opinion n comment is much appreciated.

thanks and best regards,
ling

TWS is the platform used by IB and is free for all customers


Paul

tws n IB

hi trader333,

thanks for reply. yes, i understand IB platform is a tws. but i was offer by 2 different trader provider with a charting system using tws platform too. n what their different is their tws is input with the blue & red charting whereby provide/offer spoting of entry n exit point. this is some what different from IB TWS. this is why, i m little attracted to their tws with e color bar/blue & red signal.

recently, it was introduced in e IX financial information's exhibition in london. n e direct provider in state website is http://www.nss-t3.com/overview.htm n if u hv any comment n opinion is much appreciated.

thanks much ;-)
ling

Trader333 said:

That said if you want a good charting facility and with all the other features that you get with Tradestation then that would be worth considering. IB have poor customer service in certain aspects but when it is working then it works well.

I sound like I am arguing both sides here but actually it is all down to what your main requirements are and in a straight choice I would still go for IB


Paul

Click to expand...

Paul,

I take it you are using IB as your broker because you bought TS2ki as a standalone. IS that right ? I cannot find it as a standalone - will keep looking - so the options seem to be to go use their base platform and meet their monthly trade requirements. However, this means that I have to give up using IB and perhaps hedge my account with TS by having some dollar positions.

Yrs
Shamik.

Shamik,

Yes I use IB and I will keep a lookout for a copy of TS2Ki and let you know if I find one.


Paul

Can you access your account online with Tradestation so you can view balances and open and close trades like you can with IB?

Samuel

samuelhogg said:

Can you access your account online with Tradestation so you can view balances and open and close trades like you can with IB?

Samuel

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Samuel

TradeStation provide web access for account management including account balance status but do not provide a web based platform for trade management.

Regards

TMM

Many thanks TheMoneyMachine,
So only way to enter or close a trade using Tradestation is via the platform on your home computer or telephone?
I like knowing that I can enter, close or amend a trade anywhere that has an internet connection.
Kind regards,
Samuel