SB or FX /Futures Broker??

[fastnet]

Maybe a naive question but . . .

I'm getting a little hacked off with my SB firm. Their spreads are often very skewed in the direction of breakouts, spreads expand throughout the day at will and there are often wild inter-day swings to catch stops. All only my twisted interpretation of course. . . . .

Anyway - I wondered how much more it would cost to trade future contracts direct.

For example, take the Dec EUR/USD contract. My SB firm charges a standard 8 point spread (discounting the possibility of the above).

If I were to enter a trade at, say GBP 5/kg, this would cost me 40 quid before you account for bookies rights to manipulate.

But, would I still have a lot less exposure to the market?? What is a minimum USD/EUR contract size?

What about other futures markets? Is there one place that you can trade them all direct or must you register with different brokers?

I think some contracts are USD 12.50 per tick or about 7 quid with a fixed commission.In this case, so long as the commission were less than 48 quid (what the SB would charge in spread) then you'd be better off buying the future direct??

Can anyone help??

Cheers

 

[donaldduke]

www.interactivebrokers.com

You can trade EUR GBP CAD and JPY for $6 round trips per contract on GLOBEX
(globex is the chicago merchantile exchanges electronic trading system)

The spread for EUR CAD and JPY tends be 1 or 2 pips.

IB are the most popular futures brokers used on this board.

 

[fastnet]

Cheers DD -

Forgive my ignorance but a round-trip is a buy/sell and close out?

Also what is the exposure per tick? The very reasonable commission above would only be worthwhile of the min trade was within my risk tolerance - I usually go for GBP 5/pt on a market such as USD/EUR so hardly a high roller!!.

Also SBs do list a variety of contracts in one place - is IB a direct exchange for all futures? Would I be limited as to the markets I could trade with IB or do they offer the full range of contracts available from global locations.

I shall also have a look at their site where I am sure much of this is explained.

Thanks again DD

FN

 

[frugi]

Hi fastnet, yes a round trip is as you describe. $6 for EUR/USD through IB, $12.50 a pip, 1 pip spread. You can trade a large number of different futures contracts through IB.

 

[darrenf]

You can also get currency SB's with much lower spreads.

eg d4f spread on cable and euro are both 3.

Capital spreads I understand are a little higher but certainly less than 8.

Depends what sort of size you are trading, whether you are "better off" with sb/ spot or futures.

Other thing to consider is liquidity. I have never traded futures but have heard from reliable sources that liquidity and spread can be poor outside of major market times (europe and US).
Euro I understand to be most liquid currency futures contract, cable less so and others quite ropey.

Cheers

 

[fastnet]

Thanks all -

Frugi's confirmation of minimum tick size for FX @ $12.50 (abt £6.75) still makes it a little rich for my blood despite the large spread cost with a SB firm. If there were a mini-future I'd be there.

I just feel that with increasing trading profitability (after 3-4 years!!) I'm giving a load of it back to the bookies AND they're moving the goalposts with skewed spreads. If I really am profitable then I need to be better capitalised.

As for other firms I have tried to open an account with d4F but I can't load their websire onto my PC at work. They weren't a great deal of help in trying to help me sort it out either and I can hardly call the ''IT Help-Desk'' here!!

Cheers

 

[ERA]

Fastnet, you can trade pint sized currency contracts on CME, at the moment I think it is only JPY and Euro on offer, half the size of the regular contract.

If you want to trade fx, why don't you go with a regular fx spot broker, GFT, FXCM, or Oanda , along those lines. Where you can regulate your pip size just about whatever you want. I used to trade CME currency contracts but have found the advantages of spot far greater.

cheers

 

[henry766]

if you want tight spread can't beat globex , your also, as often as not ,right side of spread , as your dealing with others like yourself, in some ways there is no spread at all , just a small comission!!