Interactive Broker

[cpatte7372]

Hello,

Thanks to the comments received from you guys I think I'm going to sign up with Interactive Broker. However, as some of you may already know I'm a newbie so I would just like to get my feet wet by trading the bare minimum number of shares.

I was wondering if there are any of you that can explain the maximum and minimum number of shares you can trade with IB? Also, if any of you have an account with IB can you please explain their commission structure. Just in case you're thinking "why doesn't hejust get the details from their website" I actually have looked at their commission structure but I don't understand it - so I'm not being lazy.

Any help would be greatly appreciated.

Cheers

Carlton

[cpatte7372]

Hi,

For those of you that are assisting me with this issue, I revisited IB's website and got the following information:


United States USD 0.01/Share USD 1.00 For up to 500 shares
USD 0.005/Share Incremental shares > 500
USD 0.003/Share Additional fee for API equity directed orders.


However, I'm little unclear what is being offered here. I submitted a similar post on EliteTrader.com but haven't received any feedback as yet.

As always, thanks for your help.

Cheers

Carlton

[Guest]

Carlton,

They charge 1 cent per trade up to 500, then everything after that is 0.5 cent per share. I do not know if there is a minimum commision charge, but I have traded 100 shares before and it was one dollar. There is no maximum. That is cheap if you are buying and selling 100 shares or less, but over 1500 shares there are cheaper brokers out there. Moreover, you have to consider that their service is minimal, although I have heard that about other online brokers to varying degrees too.

[cpatte7372]

Thanks Steve,

I understand that IB require a mimimum level of experience before they allow you to open an account with them. Do you know what that is?

Cheers

Carlton

[dgellman]

IB

I have been with IB for 5 years. I also traded on the floor for 20 years. I do believe that IB is without a doubt the best...period.
They are the ONLY (and things might have changed, so correct me if I'm wrong), place that DOES NOT charge a minimum.
I trade options. Every other brokerage, charges a $19.95, or $29.95 minimum, just to do the trade, PLUS some amount per option (like $1.95, or $2.95). So, if I were to sell 1, or 2 options...it would be $29.95 + $2.95 per option just to do 2 options. That is everywhere EXCEPT IB!
At IB, when I sell 1 option, IT IS $1 !!!!!
The same type of commission structure for stocks, etc.
Then, they give you FRE real-time data, plus a ton of free 3rd-party software. Everything from charting, to taxes, which directly reads their data.

[cpatte7372]

dgellman,

Thanks for the feedback mate.

I have just attempted to open an account with them.

Cheers

Carlton

[cpatte7372]

Steve,

I recently purchased one share of xmsr (for testing purposes) for $27.19. Interactive Broker are suggesting that the cost is $28.19. However, as you mentioned, I thought the cost was 1 cent per trade.

Can you explain? I'll be getting in touch with IB, but I thought you may already have an explanation.

Cheers

Carlton

[ACM]

Carlton
If you look at their Fees->Commissions you will see that there is a $1.00 Minimum
Alex

[cpatte7372]

So, if I purchased 100 shares of XYQ @ 30.00 = $3,000 for shares + $1 fee + $1 commision, totaling 3,002.

Is that correct?

Thanks

Carlton

[Guest]

Carlton,

I would say yes only if I had a used bridge for sale, and of course you were in the market for one...

Joking aside though, the dollar minimum means that it doesn't matter if you buy 1 share or 99 shares, the commission will cost you a dollar. The cost of the transaction is always the price of the stock plus the commission. If you bought 101 shares, the commission would be $1.01. if you bought 150 shares, the commission would be $1.50. In all cases, the transaction cost would be the cost of the stock plus the commission.

If you need some more help similar to this, you may consider looking for one of the newer reference / dictionaries that have explanations / definitions for similar questions. I had a discussion on a related subject the other day with another board member, I'll contact that person and see if they have any links to what I am referring to.

[cpatte7372]

Hey Steve,

I appreciate your help mate.

Carlton

[Guest]

Carlton,

here are some links that contain some basic info and resources which may be of some assistance.

http://www.pmtraders.com/Broker/QuestionsToAskToSelectBroker.htm

http://pages.prodigy.com/wealth/learn.htm

http://money.msn.co.uk/investing/Insight/SpecialFeatures/StartInvesting/investingtips/default.asp

This last one is for fun
http://cageyconsumer.com/brooklyn.html

[cpatte7372]

Hey Steve,

These are excellent resources - the last one is bit of a chuckle.

Thanks mate..

Carlton

[cpatte7372]

Originally posted by stevehare2003
Carlton,

If you bought 101 shares, the commission would be $1.01. if you bought 150 shares, the commission would be $1.50.

My next question is so silly that I'm almost embarrassed to post it, but would I be correct in saying that the costs mentioned is just the cost for purchasing the shares? Would there be an additional cost of $1.01 and $1.50 for selling the shares?

Cheers

Carlton

[Guest]

Carlton,

No there would be no additional charges.