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IB has a great trading platform for very many reasons that I won't go into
now. As far as queuing of stops is concerned, I can't remember the last time
I had any slippage on a stop. As for any concerns about stops not being
elected by IB, just place a stop limit order. These ARE sent to Globex.
Problem solved.
Andrew
-----Original Message-----
From: Simon Campbell [mailto:simtrader@xxxxxxxxxx]
Sent: Tuesday, February 11, 2003 7:18 AM
To: Omega List
Subject: Re: IB TWS problem with stops
Why any futures trader uses IB is beyond me given the way they handle
stop orders. Unless they've finally made the long-awaited change of
sending stops native to Globex (judging by the comments it seems not)
then in my opinion, it's a mess because your stop is only held on IB
servers which means:
- your order will only get sent to Globex as a market order when the
stop price is triggered. In the best of cirucmstances (when it works)
this means that your fill takes the lowest priority. All stops at
the same price held directly on Globex will be filled before your
order is. Orders held native on globex are timestamped and queued.
Even if you sent your IB stop order four hours earlier, Globex
doesn't even know about it until after the price is hit ...because
only then does IB actually send it off. Bottom line? time lag in
getting the order off (even if <1 second) and bottom of the pile
priority, all mean increased risk of a tick slippage. At $12.50 ES,
what good is your extra $1 commission saving?
- Your stop relies on IBs own datafeed to trigger it and send it to
Globex. A problem with their datafeed means your order can go
unexecuted. My understanding is that it's not a true streaming
datafeed but rather a snapshot every second or so. What if the
snapshot misses your stop price? Or what if the feed goes down for
10 seconds around the time your stop would be triggered? Your stop
goes unfilled that's what!
Contrast this to the situation where your stop is held directly on
Globex. It's been timestamped and received by the entity actually
doing the execution. It will receive preferred filling. Your PC
could blow up, your brokers servers could explode ...and nonetheless
you are guaranteed to get executed. The worst that happens is that
your brokers order software goes iffy (it happens to them all) and it
says your order is still working. But if you KNOW your order was
sent to Globex you have total peace of mind that the truth is you
were executed and they just aren't showing it yet. You can relax that
any software glitch has no material impact on you. Contrast that to
IB where you are sitting there with a "working" order and wondering:
"was I filled?", "is the system just slow?", "am I still in the
market?". Who needs that hassle in their life?
To me, it's such a basic fundamental to have your stop orders only
rest on Globex servers ...trading with them on a brokers' servers or
keeping them on your PC is just insanity. Pay an extra buck or two
and use a J-Trader platform* that holds stops directly on Globex.
IMHO the commission savings of IB just aren't worth the extra risk of
$12.50 slippage, the extra risk of unexecuted orders, and the mental
stress it puts on your ability to successfully trade, when problems
do occur. There's enough stress in trading without worrying whether
your orders are filled or not.
S.
*Not all versions of J-Trader can send stops directly to Globex (some
versions only hold them on your PC), but stand alone version
2.8.0.6.D does offer this capability.
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