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gfrachet

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Hi all,

I m new to pretty much everything, this site and trading my own account. i ve been a prop trader for 4 years professionally but got made redundant and want to trade my money.

I m planning to start with 20k £ and will trade only a few DAX and NASDAQ stocks. i will trade roughly 5-6 in and out/day.

I checked the CFD s with Etrade, looks interesting but the slippage and commissions look too big to make money intraday.

What are ur advices? is IB really the best? how is the software? can i trade nasdaq stocks with margin? can i short stocks , trade overnight easily?

Any others advice are welcome...

Thanks a lot and good trading!
 
If you have enough margin requirement for PDT which is $25K minimum (but $30K would be more sensible) then IB is hard to beat.

You will be allowed 4 x margin so if you have a $30K account you can trade stocks up to a value of $120K.

People differ in their view of the IB platform (known as TWS), but I have found it to be fine for any trading needs I have.

For Nasdaq stock trading you really do need direct access which is what IB is, I just dont believe that CFDs offer a good enough alternative unless you intend to hold overnight which is something I would never consider for Nasdaq stocks. I have seen stocks gap by up to $14 and if you are on the wrong side of that then you really are facing huge losses.


Paul
 
Look at
Refco
GNI
Mann
The PATS platforms is excellent and simple.

If you have experience then am sure you will be able to tell them what deal you want based on your trading record and expectations of RT's

Haggling with them you should get a good a deal as IB and failing that you can trade with them in the short term to build a trading record with the broker and get some reduced rates.

Do your own research and dont take my word for it ;)

HTH
Newtron Bomb
 
thx a lot for ur quick replies...
can i actually use the x4 margin for DAX stocks as well?
 
i just tried the demo version of the TWS...looks like there is no real chart software coming with it. is that the case? if yes, what soft would u recommend? (i was using bloom for the last 4 years but it s just too expensive for a start at home)

cheers
 
Saxobank is cfd and so the spread is way high. Since you have enough to join a normal broker and daytrade or do futures go with any of the big brokers like IB. I use them with a frontend (Ninjatrader and Buttontrader are both excellent).
I use ensign at $40 dollars a month as my charting software which is a little better than sierra charts.
Tradestation is also very good as a broker and chart softwareIf you are doing futures onlt the velocity futures is excellent and has a special offer for one month on x -trader.
 
Best low cost solution: IB + Autotrader ($ 0.00) + Quotetracker ($ 0.00) !

If backfill is required I utilise Ameritrade ($ 0.00 if more than 9 trades a month done with them)

Hittfeld
 
Trader333

What is PDT and is the better margin enticing you to take a bigger % risk.
 
kevin546,

PDT stands for Pattern Day Trading, which means that I intend to open and close more than 3 trades in 5 working days but closing on the same day that I opened. To do this I need a minimum balance in my account of $25K but as I have previously explained it is better to have $30K.

When you say does it entice me to take a bigger % risk the answer is No. Generally the maximum percent of my account that I risk on a single trade is 0.5 of 1% so by any measures pretty low


Paul
 
Paul

Thank you for your reply, I now realise the PDT is for the US trading policy concerning sells and the IB requirment for greater balance in your account, just was not aware what it was called before.

Regarding your % risk I would agree it is low but better to be safe than sorry. Do I assume that while each deal is only 0.5 - 1% capital risk that you make use of the extra margin facility and have more than 1 deal in the market at a time.
 
kevin546,

Yes I have had more than 1 trade in the market at a time but not that often in the past, although I am highly likely to for most of my future trades with 2 trades open at a time. Whilst I do not know for certain what the reward potential of any trade is, I do know that, on average, it will be at least 3 to 1.

I dont really think of the extra margin utility, as things stand I can purchase stocks up to the value of $120K. I scan around 160 stocks continuously throughout the trading day and these stocks have been selected as being in the range of $15 to around $80. Most that I get signals for are in the price range of $30 to $40 so trading 2000 shares at a time would generally only require a margin of $80K. There are other factors that I have set for stock selection criteria including minimum volume and other requirements.

I hope this helps



Paul
 
That is correct. That is where QuoteTracker comes in. Can be used for free, or as a paid advertising version (the difference is ads) :
http://www.quotetracker.com

Works with IB as well as lots of other brokers and datafeeds.


gfrachet said:
i just tried the demo version of the TWS...looks like there is no real chart software coming with it. is that the case? if yes, what soft would u recommend? (i was using bloom for the last 4 years but it s just too expensive for a start at home)

cheers
Click to expand...
 
Roberk,

What is a 'frontend' please (you made reference to using a frontend on IB?)

Is it, for example, performing the same task as TSim? Is it in place to simplify the TWS platform? Can you trade via a frontend in the same way as you can place trades via Tsim to communicate directly with IB?

Many thanks,
Sean
 
PDT - loophole

There is a loophole to the PDT (pattern day trading) rule.

With some brokers, if you trade the same stock symbol multiple times in one day, it will only count against you as one trade.

For example: you could buy 100 MSFT and sell 100 MSFT 10 seperate times in one day and it would only count as 1 buy of 1000 MSFT and 1 sell of 1000 MSFT (1 day trade) against the rule.

That means that if you trade only one stock each day, you can trade for 3 full days out of each 5 business days and make multiple trades on each day without violating the rule.

The only broker I know of that takes advantage of this loophole currently is RealfastTrader.com

[Mod's note: Post edited - please refrain from advertising on the forums - this is not permitted]
 
What IS the Pattern Day Trading rule?

Are there other similar types of rule?

Do you have to declare your 'style' to your broker to fit into a specific category?

How frequently can you change your category (and is that dependent upon each specific broker's T&C)?
 
The PDT rule says that if you have less than $25,000 USD in equity than you can only make 3 day trades (a day trade is buying and selling the same stock symbols in the same day) in any 5 consecutive business days. Positions held overnight do not count, only day trades.

If you have $25,000 USD or more in your account, you can day trade as often as you want without any restrictions.

That is why the loophole I mentioned earlier is so helpful to people with low equity, you can still do multiple day trades.

Thanks,
NYC

[Mod's note: Post edited - please refrain from advertising on the forums - this is not permitted]
 
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