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Non-Tech : Interactive Brokers / Timberhill -- Ignore unavailable to you. Want to Upgrade?

To: rocklobster who wrote (911)	12/17/2000 10:28:56 AM
From: dli	Respond to of 9012

rok, if you are referring to NASDAQ stocks then you should keep in mind that NASDAQ does not support an exchange-held stop mechanism. If stops are available they are always held by the broker. There's two potential reasons why you may be experiencing increased slippage compared to Schwab or other online brokers: - First, IB triggers stops not based on prints but based on bids and offers (and there have to be at least two of them to trigger the stop). Thus, you can pretty much forget about ever getting an execution at your stop price. Especially on NASDAQ stocks you will always be paying the spread which can easily be more than a point with some of the more volatile and higher priced stocks like e.g. BRCM. If you want to compensate for this effect you have to adjust your stops accordingly. - A second reason for inferior stop executions compared to online brokers can be their practice of selling order flow. Since that often involves and AutoEx agreement with an MM firm you will often be able to get fills at the inside market when in fact through direct access there is simply no liquidity available anymore. This is a very common scenario in a stock that is falling fast and the only way you can hope to possibly avoid it is by not using a direct access broker. As for NYSE stocks, however, the criticism of IB's handling of stops brought fourth in the earlier post concerning futures is valid. Even though the NYSE supports exchange-held stop orders IB refuses to use them which results in the same kind of order prioritization disadvantages. I've complained about this to IB months ago, but the only statement I was able to get out of them was that "they think they are handling NYSE stop orders in their customers' best interest" which they clearly don't. Dave