Looking for cheap and safe Eurex/Euronext clearing

[hrokling]

I'm an equities trader looking to establish an account for trading Eurex, ICE and Euronext/LIFFE. I have amongst others looked at Trader's Clearing Alliance (TCA), but since I can fund my account with a large amount I would like to have a designated segregated account with the clearers.

Can anyone offer any advice as to how to go about getting rock-bottom rates (i.e towards 0.50E per Stoxx50 RT). I am in a position to set up my own company if needed - can I then enter into a clearing arrangement with say Fortis? Would they actually take my business as an individual or through a Ltd I set up?

Does anyone have an idea as to what rates one can possibly achieve with 20-50k lots per month?

Obiously I will then cover software, data, IT etc etc on my own.

 

[Halo]

A load of the large London Futures trading rooms offer online/remote access and as they are responsible for the bulk of the Eurex/LIFFE volumes can offer great clearing fees - more than likely a sliding scale reducing costs as you hit volume targets. I suspect you're looking at a minimum account of £10k+ though. Try the www.liffe.com website or Arcade list here - STA, Marex, Kyte, Man Financial etc all offer online trading I believe. Good luck

 

[hrokling]

Thank you, Halo.

Yes, I've extensively scoured the web to research the London arcades. I am slightly worried about the security of funds, though. Funding the account isn't a problem. Obviously, the advantage might be that one just chips in a small amount and get increased leverage, thus reducing your exposure that way.

 

[Directional]

Marex accounts are individually segregated, I dont know about STA, Kyte etc. The Marex rate for 20,000 lots on the Stoxx future was 30c ex fee + 12c clearing fee (as of Dec 05, this might be different today).

the TCA are probably about the lowest non-tiered Eurex rates anywhere, I think they are just €0.04c flat rate on top of 30c exchange fee's for Stoxx. But you would need to do your own homework on how the accounts are structured, how much buying power Fortis will give you etc. If you have lotta cash, you can get your own seg fortis account I beleive.

 

[nohare]

Thank you, Halo.

Yes, I've extensively scoured the web to research the London arcades. I am slightly worried about the security of funds, though. Funding the account isn't a problem. Obviously, the advantage might be that one just chips in a small amount and get increased leverage, thus reducing your exposure that way.

Hi as a company we clear Fortis and we can get very good rates for introducing new clients to Fortis. Funds are secured directly with Fortis but benefit from our specially negotiated rates.These new clients can be either individual or companies. We have previously negotiated highly competitive flat rates or scaled rates depending on the potential business of each client. Please feel free to contact me if you require further assistance. Nohare

 

[Parky]

You are right to be concerned about the security of your money. First and foremost any company that takes client money "MUST" be FSA registered. From that point on your safety is the size of the balance sheet of the company you are opening a clearing account with.
Segregation is often totally misrepresented so let me try to explain. Lets say you like the look of an arcade ABC and they clear Fortis, they will probably try to misrepresent their position by saying "clear us we clear with a high net worth company" like Fortis or Man Financial. Wrong, that means that ABC enjoys the protection of the balance sheet not you.
Your risk is ABC. If they blow up like Griffen or ICA then you loose your money plain and simple. However the other clients of that clearer be it Fortis of Man are protected against the failure of ABC.
So dont be mislead, all clearers reagardless of size will be happy to sign up a Limited company, in fact US clearers will not sign individuals they will only sign Limited companies, the complaince paperwork is different but that is it.
However just because you want to enjoy the protection of the big balance sheet does not mean you have to go to an arcade run by those comapnies, a few arcades give the best of both worlds, they offer market connectivity in professional trading rooms but encourage you to contract directly with the big clearing companies. These "IB" or introducing broker agreements recognise the weakness of the smaller balance sheet arcades but also their strength in offering high quality market access and bespoke IT services. E-mail me if you want more information on the hybrid trading rooms.