Why IBKR is a good Futures Broker

In the video we tried to cover some important things related to trading derivatives products.
IBKR is a good broker however as you may know, margins are high. This is the standard for IBKR since they cater more to swing trading customers with their low margin interest. For a better understanding of day trade margins, this video shows position sizing examples for day traders: • Position Sizing for Da...
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VerrilloTrading may have an affiliate relationship and/or another material connection to any persons or businesses mentioned in or linked to in the content above, and may receive commissions from purchases you make on subsequent web sites. You should not rely solely on information published by VerrilloTrading to evaluate the product or service being offered.
The content that this channel provides is intended for educational purposes only. Trading futures and options involves substantial risk of loss and is not suitable for all investors. Past performance is not necessarily indicative of future results. The risk of loss in trading commodity interests can be substantial. You should therefore carefully consider whether such trading is suitable for you in light of your financial condition.
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00:00:00 Introduction
00:00:30 Margins
00:03:32 Commissions
00:07:03 Data Feeds
00:08:50 Execution / Adaptive algo
00:10:18 Connectivity / Jigsaw
#futurestrading #interactivebrokers #trading

[@kphilipps55]

I was looking for this info for days!! Finally found your video and you answered all my questions in 10 min, everything i was looking for. Thank you so much!

[@VerrilloTrading]

Glad it helped! Feel free to drop any questions.

[@jimbare1638]

Thank you for this! Super informative and helpful

[@VerrilloTrading]

Glad it was helpful!

[@sahebpannu7577]

Very helpful video man, cleared my doubts. Thanks for sharing!

[@VerrilloTrading]

Pleasure!

[@genjimccorkle5518]

Thanks for the detailed review. I was on the fence on IB because of alot of mixed reviews in regards to data feeds online. I currently trade futures, forex, and considering options and needed a one stop shop to trade all of those.

[@VerrilloTrading]

Glad it helped.

[@mikesmithyes967]

Would greatly appreciate a Futures trading TWS setup. I haven’t seen anything on YT and you’ve been helping me a lot with IB.

[@VerrilloTrading]

Thanks for a great suggestion!

[@wtfisthis9192]

Do you have a video of you trading futures on IB with setting up stop losses and profit?

[@browndog4654]

Hi thanks for your very informative video, could you please explain what the numbers at the bottom of the page under the line "Maintenance Margin Minimums" mean? Futures: 50 USD /contract Options: 50 USD/contract for 100 delta units

[@deryadan6519]

do you have any video showing how to setup and trade basic emini SP500 or NQ with charts?

[@yousefrezaie6572]

hello there thank you for the graet lessons im with interactive brokers i wanted to trade #es S&P500 but not sure what of following permissions do i need ? please thank you Futures . RequestTrading Permissions ? Futures Options Request Trading Permissions ? Single Stock Futures Request Trading Permissions ?

[@kevinatencio7468]

I have the demo and when I practice futures they charge me spread,why?

[@flareup9057]

i noticed the adaptive algo cost alot more in terms of commissions which makes it hard for scalping and scaling in and out. Is it really worth it such that the increase in commission offset the fill at better price and speed? Secondly, what's your settings for the adaptive? Is it urgent, normal, or the slow but good price option? I do notice I get filled at the worst possible prices with basic market order (I mean it). I thought to myself IB must be getting some kickback for directing market orders to the worst price for customers, which is why i use limit order at the ask/bid majority of time unless its for emergency. Sometimes, the price is too volatile that u just need to market order out and this limit at ask/bid trick doesnt work =( Oh yeah, why did u move to futures instead of options? I find it interesting that you trade different derivatives whereas most ppl just focus on one because it's just so complicated and require deep knowledge to succeed

[@VerrilloTrading]

You're probably talking about options trading. Scalping in general is much harder with options because of many reasons, one of them being the varying commissions. If you need to get in at market for whatever reason, adaptive is the way to go as it will scan available prices instead of sending your order directly to the market making algos that will front run the order in miliseconds. For the setting, I keep it on normal and it generally works great with options and futures. I haven't tried the patient too much but I imagine it will take a few seconds extra to execute the trade. Possibly the patient feature would work if you're looking to find price improvement on a slightly bigger order. At that point there are other 3rd party algos in IB that might be more efficient for filling bigger orders, haven't tried any. In terms of the futures, simple answer they're just so much more efficient in terms of trading instruments. Options should be viewed as bets, bets are made to be sold if you plan on making any long term money. Buying options to scalp is possible but you need good volatility and amazing liquidity. Market makers have a strong edge in options trading cause they pay no commissions and they are allowed to pass hedging costs onto the price of the option. So if someone suddenly starting buying up calls, they need to hedge to be somewhat delta neutral. They are in theory, allowed to manipulate the price of these options to make up for their hedging costs. (give or take of course). Futures are regulated on one exchange with super low fixed commissions and are just great trading instruments for trading the indices.

[@AW-ud6eh]

Hey I really appreciate this video! I am wondering what type of account I need to open in order to trade futures? (Portfolio margin account vs. Cash account?). I am in Canada and wondering how the application process would work for me to be able to trade the micro indices. Apologies for the newbie question! Thank you so much for your help!

[@VerrilloTrading]

A margin account would be what is required to trade futures. Do your homework as to which broker will fit your style best. With IB the margins are high which can be both good and bad. I currently use AMP, cheers.

[@AW-ud6eh]

@@VerrilloTrading thanks for your help man!! Much appreciated

[@AW-ud6eh]

@@VerrilloTrading hey how long did it take for you to get your futures account verified? It seems to be taking me a while haha

[@amnmnc6917]

hi thank you for this great and rare initiative ,please one qst , in ninja trader they limit you for example you cannot buy more than 20 contracts once on crude oil , what is the case for IB Please ?

[@VerrilloTrading]

Your position size first of all should be determined by your risk management strategy, not a limit that your broker sets. Brokers generally do not have limits like this set. The only limit is your maintenance margin, if your account remains below that they will liquidate you.

[@nikowai8314]

I want to know that although there is a delay in IB's data transmission, there should be no delay in the order when placing an order, right? Then use the denali data of sierrachart, and then use Interactive Brokers to place an order, it should be perfect (because Interactive Brokers will even reduce the data fee when the number of orders is sufficient)？thank you for your kind answer! ! !

[@VerrilloTrading]

You can determine this by looking at the order book for your market. Place a limit buy or sell at a further away price and see how long it takes to appear on the book and get added to the queue. It should normally be in the realm of a few ms but those ms make a difference if you are a very quick scalper.

[@ytsg10]

Thanks for the vid: have you tested the IB data in Jigsaw? I heard it does not work as well as CQG or Rithmic but maybe that is better now?

[@VerrilloTrading]

I haven't tested it in a very long time but I doubt it has improved. The data straight out of TWS is not a tick by tick data feed which is not very good for DOM. On Jigsaw CQG was the best data feed I used, Rithmic was good since it had the whole order book but it had some problems.

[@ytsg10]

@@VerrilloTrading thank you!

[@leanders4958]

Would you recommend Jigsaw (especially for Interactive Brokers clients)? Can Jigsaw show me the data for stocks,too (when I signed up for the right market data of course)?

[@VerrilloTrading]

Yes I would recommend it. The connection is relatively new and I haven't tried it for stocks but it works great so far. Watch Jigsaw's video about the connection to IB and don't be shy to ask them questions.

[@otmanalami6621]

Please, what about the spread of e-mini NASDAQ?

[@janeknikicicz9753]

Adaptive Algo vs SMART Rebate (or other), when do you use which?

[@VerrilloTrading]

Both are useful. Adaptive algo is great when you want to get a fill ASAP and not necessarily hit the bid or offer and remove liquidity. The other ones like smart prefer rebate is used when you use a limit or rel order. I made a clip on options routing and depending which one you choose it can route you to different market maker. kzbin.info/www/bejne/jYTMhp6mjsuogLM

[@kaihaod7073]

Does IB allows trading commodity futures in Moscow exchange ? Please reply

[@VerrilloTrading]

Try looking on their website. interactivebrokers.com/en/index.php?f=1563&p=europe_stk

[@vishnu-krishna108]

If my base account is in aud, should I convert to usd before trading US futures ? Any help

[@VerrilloTrading]

It is not strictly necessary to do this. Just know that the pnl will be in USD and this will be reflected in your cash balance when you close a futures position. Overtime if you maintain a negative usd balance overnight you’ll be charged some interest and also earn interest for positive cash balances.

[@Gero6]

I agree with you IB rules...

[@VerrilloTrading]

Cheers.

[@superflashone436]

I have a question with IBRK. I am not a future trader. Can clarify this one please?? is buying power settled immediately??? I am confused with stock trading, which I wait T+2 days for cash settlement after sell.

[@VerrilloTrading]

In a cash account yes stock trades should settle T+2. You will have access to the buying power but there are things to watch out for. Since you would be trading with unsettled funds, the broker may let you initiate new positions but you probably won't be able to close those positions until the funds have settled.

[@reichjef]

I never would use the tiered commissions. If I’m hitting that amount of trades, I’d have to be exceptionally rich, or way over trading.

[@VerrilloTrading]

I think i’ve been set to tiered for quite awhile and never had an issue. I remember people saying fixed was better when trading large amounts of shares.

[@leroyconley5647]

just saw your post. At ibkr do you know if the minimum amount in your account is still 16500 to 20000 to trade futures ?

[@montan3486]

Bro i cant believe its that much bro.

[@VerrilloTrading]

Yes but it might be lower now. They use the exchange margins and don't offer intra day margins like other futures brokers do.

[@gravityboxer]

Are there any limits to how many shares you can buy? As in 100 or so? Idk if you said it in the video cause ive adhd lollll

[@VerrilloTrading]

We're talking futures in this video, no shares involved. There is no limit to how many contracts you can buy or sell but you need the initial margin requirement in your account to hold the position. The example I showed in the video about 1 NQ contract requiring $16,500 as initial margin. If you don't have that amount you can't even trade 1.

[@othmaneab1480]

would you recommend Ninjatrader ?

[@VerrilloTrading]

Never used it

[@MAHAN1755]

You said for trading the NQ the margin requirements are $16,000.00. Is that $16,000.00 per contract? So if I traded 10 NQ contracts I would need $160,000.00?

[@VerrilloTrading]

Yes.

[@feboogi]

Initial margin for mes is 1165 usd ....is that per contract ?

[@VerrilloTrading]

Yup

[@breezefor5966]

IB fills are the best, totally agree with you!

[@VerrilloTrading]

Very true brother.

[@GymWorkFamily]

Can you trade the emini and emicro on their mobile app?

[@VerrilloTrading]

Yes it is supported.

[@sbtopjosh4098]

Mine isn't supported..

[@gtarizona737]

I just opened an account with Ninja Trader and they are charging $1.47 per contract side on the Micro Mini Nasdaq using CQG Desk Top which costs $25.00 per month along with $11.00 per month for CME data. This is to only

[@VerrilloTrading]

$1.47 per side on micros? Sounds like minis. Amp is $.39 per side for micros.

[@trinidad428]

Can I purchase Cryptocurrency on Interactive Brokers and if not what should I use?

[@VerrilloTrading]

Generally not. There might be 1 ETF and you can trade the CME bitcoin futures at extremely high margins. Try working with the crypto exchanges, bitmex, coinbase etc.

[@prashantpatel3741]

whats margin for ES?

[@VerrilloTrading]

The info would be most accurate on their web site.

[@kevinatencio7468]

Futures suppose no to have spread?

[@VerrilloTrading]

There is a spread in any market. Only at very rare moments can the bid and the offer both be the same price. Of course the spread is tight but it can widen in times of thinner liquidity or high volatility.

[@mr.g1683]

What broker offers the lowest margin to trade (MES) MICRO E-MINI S&P 500 FUTURES

[@VerrilloTrading]

There are a few that offer low intraday margins but this margin is if you close the trade before the close. In order to hold trades after close the margin is set by the exchange, no way around that. AMP is a good one.

[@mr.g1683]

@@VerrilloTrading What is the margin with your broker to trade the (MES) MICRO E-MINI S&P 500 FUTURES?

[@VerrilloTrading]

​@@mr.g1683 It's $40/contract for intraday margin. www.ampfutures.com/trading-info/margins/

[@hedgefund2138]

ou trouver une assistance en français chez ibkr ?

[@VerrilloTrading]

I consider order flow as raw data so yes there are many times where the information could be considered as misleading or not reliable at all. The key is to use it in context with other things in your trading, it can help as an execution method if used in this way. It's best in markets where there is a lot of volume and liquidity but there is a sweet spot with that too. 10 years are extremely thick these days it's hard to follow the constant reloading.

[@hpt08]

Interesting video. If you open an ibkr account and think you need a while to understand the platform and think hey, you know what, I'll put my 2k USD into a Dow30 etf and let that sit for a while then you'll be surprised because you can't! You have to invest in a raw stock if you have a relatively low balance. That's my understanding at any rate - UK based btw

[@VerrilloTrading]

You would need to understand the capital requirements for the markets you trade, no matter if it's an ETF, stock, future, etc. Most trading platforms including IBKR TWS will show your margin requirements.

[@hpt08]

@@VerrilloTrading ibkr is very different to some other brokers. Takes a lot of getting used to

[@VerrilloTrading]

@@hpt08 A lot of brokers do the hand holding model and make the customer pay more for that convenience. IBKR is pretty much a do it yourself broker.

[@hpt08]

@@VerrilloTradinginteresting DIY description. is it the only one like that?! Would you be able to name others?

[@VerrilloTrading]

@@hpt08 There are no others that I know of in Canada. If you’re in the USA there is many options and probably better because they are smaller firms which compete for clients. Normally the smaller the firm the better deal you can get in regards to margins and fees. IBKR is a massive broker and in Canada they have a competitive edge over the big bank brokers.

[@ChrisMcNeely]

no love for Tradovate?

[@VerrilloTrading]

Not in this video haha. I heard they are a fair brokerage. Do they allow Canadian accounts? Good margins, commissions? Cheers.

[@danielrand8849]

I used to scalp the NQ and Dax with tradestation, the slippage was painful. This was about 2 years ago. I use IBKR today.

[@VerrilloTrading]

Cheers.

[@drifterphoto]

ibkr micro emini s&p is 47 cents commission per contract.

[@VerrilloTrading]

now $0.52 as the exchange increased the exchange fee.

[@Gindaman999]

IB is the best (in general) excpet for its platform (TWS)... which is probably the worst among big brokers

[@VerrilloTrading]

It's not so bad come on.

[@Gindaman999]

@@VerrilloTrading Well, bad enough for me to get 3rd party software platform using their API with a fee

[@tallman7059]

I am an AMP User..

[@VerrilloTrading]

Experiences?

[@SG-vf4bj]

So do you prefer to blow up a 16000 dollar account or a 500 dollar? Because 90% of traders, sooner or later, will blow up their accounts.

[@KrecikBobasek]

then why they even try ? i was blowing up 500 accounts but once i got 10/20k accounts i started making profits. Its way more easy to be patient and disciplined when u w8 for 1% that will feed u for a weak instead of 1% that will buy u pack of cigarettes.

[@mmrllmonta]

nope its Ninjatrader hands down

[@VerrilloTrading]

Thanks for sharing.

[@antoniodesimone4689]

16,000$ just to buy one NQ contract??? I hope it's not just for one contract! otherwise, this broker it's complete garbage, let's say that I use five contracts, basically I need to park 80,000$ with them ahahaha and why would I do that when I can use AMP futures and only use a fraction of that amount ??? the money I save can be invested or used instead to remain stuck in IB. I hope they pay you well to say these BS, if they are not paying you, you clearly don't know what you are talking about!! Another advantage is that withe AMP I can choose several platforms and different data feeds like Trading Technologies and Rithmic both superior than IB garbage!

[@VerrilloTrading]

With all due respect, it is you who did not do your homework. This number of USD $17000 is the capital requirement for Nasdaq 100 futures from the CME exchange. You can view this here: www.cmegroup.com/markets/equities/nasdaq/e-mini-nasdaq-100.margins.html#span=span What you are referring to here is day trade or intra-day margins. These are lower margin requirements that are offered by discount brokers for short term trading strategies that require higher leverage. With a discount broker like AMP or Ironbeam, if the trader decides to hold the trade past the market close, they will still be required to have the full exchange margin in their account. When the market opens again it normally goes back to day trade margins. This applies to discount futures brokers and not Interactive Brokers. If you would like further explanations of why these margins are as high as they are, there is an explanation in this newer video that goes over margins with IBKR: kzbin.info/www/bejne/j16wnpSAgLZ7d80

[@antoniodesimone4689]

@@VerrilloTrading Maybe I had to specify that I was talking about day trading, and I thought you were a day trader too. I know there is a difference between intraday margins and overnight margins. IB has crazy requirements for intraday trading and there is no reason to promote IB compared to AMP for example, the vast majority of Traders on you tube are day traders why would they even consider IB? there is literally NO reason to pick IB, not even for the data feed itself. The point of my comment remains valid there is absolutely no reason to choose or promote IB compared to other brokers.

[@KrecikBobasek]

AMP is scammy. u can even check in their demo to open and close all the time and u will get profit.....

[@VerrilloTrading]

Scammy in what way? Yes that is related to the demo account service itself not the brokerage offering it. The service is probably a low quality and unrealistic simulated trading service, that would explain the order fills. Try using a higher quality simulated trading service.

[@KrecikBobasek]

@@VerrilloTrading I had realy bad problems when i was trying to comunicate with them. Their service is just bad asf. Evrything was hard and clumsy with them for me. In ibkr i never felt once i was used or scammed. Evrything is crystal clear and i dont have any trouble with support and app. Mby others have better time with them but for me it was just bad expierience. evrything was poor.

[@davidplyler8173]

I use the sierra chart replay on SIM and the fils are close to real time. Sometimes I'll SIM trade the morning session after I've traded it live. I use amp and they've been good btw.