Choosing an online broker

[noident]

Greetings!
I know the topic of choosing a broker has been brought up multiple times and I have browsed through all the posts I could find. They did contain answers to some questions I have but not all the questions.
I would appreciate any answers/suggestions and hope that this thread may be useful to others in the future.
I have never traded before and am in need of an on-line broker that fulfills the following requirements (in decreasing order of importance):

1. Reliability of service, especially on busy days. I heard CommSec's website tends to go down right when most people wish it was up. Ideally I want no downtime at all (during trading hours), ever.
2. Prompt execution of orders. Here I may be talking nonsense, if so I beg to be excused. I realise that the execution of orders depends on the market and it's a supply/demand thing. But I want my broker to at least put my order on the market ASAP. Also they may cross-match. I want them to give it their best shot as soon as I file an order.
3. Price per transaction. Also, price per executed stop-loss order. During my computer trading simulations, given the system I've developed, I estimated that I will spend about 15.000 per year in trading fees based on $30 per trade and $10 per executed stop-loss. That's a lot of money and I would want to cut down on that a bit, without compromising on points 1 and 2 (see above) though.
4. Conditional execution (stop-loss) available. I know most brokers have this option. Also I will be updating my stop-loss daily so there shouldn't be any additional charges for updating the stop-loss condition, I just want to pay when one is triggered and executed.
5. I estimate that about 15-20% of the time I will be holding cash and no shares (yes, chicken), I will want the cash to be in my Westpac savings account so that it offsets the interest on my home loan. Therefore I would like my broker to be able to debit/credit my savings account directly. I don't know if this is even possible.
6. Trading through a web interface. I need to use a web interface, and one that is presented in html/javascript, no java applets/webstart thingies. I may use scripts/programs to pull data from the web interface automatically and even *maybe* automatically execute some trades in the future (I understand that web interfaces change from time to time). I absolutely don't want to use any proprietary software supplied by the broker to trade or access data. I am more comfortable writing my own programs than using ones others have written, this way at least (I hope) I understand what they are doing and can adjust they way they work.
7. End-of-day data available for download at the end of the day. I need the data (open, high, low, close, volume) for all ASX listed companies in a text/csv file (not in some proprietary binary form only readable by some SuperTraderSoft).
8. Real-time quotes available (again through a web interface so that my scripts can read them and email me with alerts).

At this time I am leaning towards the Westpac broker, it is a bit on the expensive side though ($25 per trade with a special account or $30 without one plus $
10 per executed stop-loss).
Any thoughts? Thanks in advance.

 

[CFD]

I'm not sure if Bell Direct will meet all your requirements, if they do they would save you half of your expected dealing fees!

I didn't give a link because it helps this forum if you go there via Bell's adds on the forum.

 

[chrisee]

I have done a lot of trading with ComSec. I would definitely recommend them.

Two days last month it didn't load at all for me, but that was due to extremely high usage. Think January 22.

 

[zenzen]

I use Westpac as my broker (the ordinary web based one not the 'trader pro').
I don't trade often but visit the site nearly every day. Never had an issue it should do everything you want though the brokerage is high for regular traders.

www.brokerchoice.com.au directs to
http://www.infochoice.com.au/Home/Investment/OnlineBrokers/TabId/68/Default.aspx
This is a good list of Australian brokers.

"Interactive brokers" which advertise on this site is causing a buzz with very low brokerage (0.08% , $6 minimum), but they are US based without an office here.
http://individuals.interactivebrokers.com/en/main.php
There is an extensive discussion of this broker elsewhere on this forum.

 

[tcoates]

You might already know this, but...

...need to watch out for the costs (of the extras). for example:

* (with commsec) if you use a margin loan there is $10 fee per transaction

* (with commsec) if you want to short stocks (not using cfd), then min order is $25000 (assuming term short trade vs day)

* cost of conditional orders???

* ease of depositing/withdrawing money. can I do it online, or do you want to call broker each time. and then if you have separate account, then how long does it take the transfer to take place?

* can I use existing (external) account to access funds from? (suncorp allow this, but etrade does not - have to setup ANZ account)

* other....

Tim

 

[Menage]

Recommendation on a good online broker

I am brand new to this stock world & have decided to commence trading options. Presently I am busy reading books, learning terms & basically studying the whole options scenario to which part of will comprise a broker. I dont want to spend big dollars on advisors hence I have a preferance for online brokers who have an office in Oz ( preferably Perth) just in case I need to ring them. I have come accross Optionsxpress, does anybody have any feedback on this company?? Any recomendations on alternative companies would be appreciated.

 

[Beenjammin]

Hi Menage,

Im in a similar situation to yourself, except maybe a bit further down the track having started trading options. Ive used Comsec and found their Iress implementation very good indeed, and free as long as you execute at least 12 trades a month (or spend a minimum on brokerage). On the downside it took months for them to process my application, plus I want to trade using a specific strategy that they dont seem to be able to accommodate (I wont bore you with the details, but its a bit left of centre so not too many people would share my problem).

I recently had a look at Interactive Brokers and they look like an interesting alternative. Much cheaper that Comsec and their customer service is much faster, plus you can trade a huge range of markets if you are game. I have yet to play with their trading platform, plus it a US company and Im not 100% clear on the risks presented dealing with an offshore entity so Ill hasten slowly. But Google them and have a look over their website and see what you think. Ive still to make a decision on using them but they look ok so far.

Good luck!

 

[jackson8]

Re: Recommendation on a good online broker

I am brand new to this stock world & have decided to commence trading options. Presently I am busy reading books, learning terms & basically studying the whole options scenario to which part of will comprise a broker. I dont want to spend big dollars on advisors hence I have a preferance for online brokers who have an office in Oz ( preferably Perth) just in case I need to ring them. I have come accross Optionsxpress, does anybody have any feedback on this company?? Any recomendations on alternative companies would be appreciated.

as a beginner myself in options i use comsecc for a couple reasons

ease of money transfer and their cash account pays reasonable interest , also can have debit mastercard linked to it

Australian so that makes the application process IMO easier and makes me feel more comfortable with my cash being held in oz.

couple of minor drawbacks : sometimes if you need phone support it can take awhile to get thru. wouldn't rely on making trades over the Ph only over Internet platform.

also if you are doing spreads you will need to place each leg individualy.......at my early stage i didnt necessarily see this as a drawback as it is a good learning process to help understand how the market and mms work.

all my own opinion and their are others here with far more experience who may have better options for you.

here is a link to thread which may be of some help

https://www.aussiestockforums.com/forums/showthread.php?t=13775

 

[MS+Tradesim]

I recently had a look at Interactive Brokers and they look like an interesting alternative. Much cheaper that Comsec and their customer service is much faster, plus you can trade a huge range of markets if you are game. I have yet to play with their trading platform,

Iress is a toy compared with IB's platform. It's a joke having to use a password every time I place or modify an order with Comsec. IB have one click order placing/modifying/cancelling. IB charge no extra for conditional orders. Also, I have had no end of trouble with Comsec since they switched from Protrader to Iress - orders not executing, stock missing from my account, Iress crashing when placing trades, and so on. I am in the process of moving my funds elsewhere.

However, I don't trade options so I can't comment on how IB may be for them.

 

[cutz]

Hi Everyone,

Regarding the comments on platform reliability I’ve found that the cause of most problems are cable ISP related, i.e. cable has trouble coping with above average peak demand, it shows up as extremely slow speed, its looks like a platform fault but its not.

Regarding iress crashing, I had this happen a few times on my old laptop running a second screen obviously loading up memory, since I upgraded to a desktop iress has never crashed.

 

[sails]

Iress is a toy compared with IB's platform. It's a joke having to use a password every time I place or modify an order with Comsec. IB have one click order placing/modifying/cancelling. IB charge no extra for conditional orders. ...

MS, I believe the problems you mention with Iress are broker specific. I have used Iress for a few years and NEVER had to enter a password to place/modify orders - and never had to pay extra for conditional orders either.

Beenjammin, it's very easy to order options with IB - just take care should negative pricing appear when ordering a spread - although at this stage, it appears that bug has finally been fixed. Also, if writing options which become at risk of assignment, suggest you really need to understand IB's stringent assignment policy.

EDIT: the other thing I've found is that Iress gives much better information especially with market depth in options. IB only gives one line - with Iress you get the lot.

 

[MS+Tradesim]

MS, I believe the problems you mention with Iress are broker specific.

That's a good point. I haven't used Iress with any other brokers.

 

[cutz]

Yeah,

I have to agree with you there Sails, filling out the order pad then entering password often rushing had caused a couple of fat finger incidents for me, luckily the guys on the desk sorted things out prior market entry.(the commsec options desk authorizes the order prior to going to market, stocks are straight through)

Trading password seemed like a good idea at first but it’s actually a hindrance.

 

[AlterEgo]

MS, I believe the problems you mention with Iress are broker specific. I have used Iress for a few years and NEVER had to enter a password to place/modify orders - and never had to pay extra for conditional orders either.

Same here. I don't have to enter passwords, and don't pay for contitional orders either. And email alerts are free too.

 

[Beenjammin]

Same here. I don't have to enter passwords, and don't pay for contitional orders either. And email alerts are free too.

I think he's referring to Comsecs implementation, where you do have to enter passwords, pay $10/$15 for conditional orders, and pay for email alerts. Other brokers using Iress will have implemented their own fee regimen. Ive seen a few implementations of this and they are all slightly different, so when you talk about Iress youve reallygot to specify who the host broker is.

 

[sails]

I think he's referring to Comsecs implementation, where you do have to enter passwords, pay $10/$15 for conditional orders, and pay for email alerts. Other brokers using Iress will have implemented their own fee regimen. Ive seen a few implementations of this and they are all slightly different, so when you talk about Iress youve reallygot to specify who the host broker is.

I believe Iress can be altered somewhat by the various brokers. I guess it would be one of the selling points to get brokers to take them on. I prefer Iress is it's original state - it works extremely well.

The functionality of Iress does appear to depend on the host broker.

 

[Beenjammin]

I believe Iress can be altered somewhat by the various brokers. I guess it would be one of the selling points to get brokers to take them on. I prefer Iress is it's original state - it works extremely well.

The functionality of Iress does appear to depend on the host broker.

Hi Sails,

I suppose it depends how loosely you use the term "functionality", - the way the brokers implement their rebadged package does alter from broker to broker and is different to the original, but they have access to the same library of functions they can switch on and off.

Here are two trial broker logins you can compare, youll see the menus are slightly different:

http://www.morrisonsecurities.com/int_trading.htm
http://webpromos.com.au/commsec/CommSecIRESS/

Cheers
B

 

[kitrob]

I cannot speak highly enough of IB. It is a powerful and complex platform, or at least I found it so, but once you have completed the webinars half a dozen times its all a piece of cake. I like the cheap brokerage, and the ease and speed with which one can place trades. i use it only for trading the ASX. If I had any complaints it is that the obtaining of online help through there message centre is bit of a fag, but livable. I today found out that there speed of placement for a shorting order is abysmal. Its been 3 hrs since I placed 3 short orders and none have executed. My other concern is security of funds. I am about to plonk another lot of cash into my account but before I do I think Ill double check on safety. The only other concern I have, and I would appreciate someones input here, is ease of account closure in the event of my death. given there is no office in NZ or Oz it concerns me a little. Other than those fundamental matters Im hooked on the site. In fact IB and Incredible charts is all u need I reckon to give the trading a good nudge.

 

[beamstas]

Interactive Brokers

 

[mtmellum]

I cannot speak highly enough of IB. It is a powerful and complex platform, or at least I found it so, but once you have completed the webinars half a dozen times its all a piece of cake. I like the cheap brokerage, and the ease and speed with which one can place trades. i use it only for trading the ASX. If I had any complaints it is that the obtaining of online help through there message centre is bit of a fag, but livable. I today found out that there speed of placement for a shorting order is abysmal. Its been 3 hrs since I placed 3 short orders and none have executed. My other concern is security of funds. I am about to plonk another lot of cash into my account but before I do I think Ill double check on safety. The only other concern I have, and I would appreciate someones input here, is ease of account closure in the event of my death. given there is no office in NZ or Oz it concerns me a little. Other than those fundamental matters Im hooked on the site. In fact IB and Incredible charts is all u need I reckon to give the trading a good nudge.

Have traded us on & off for 4 years (use a mob called mytrack and penson for the bank acct). Had to bring cash back to aust twice. As long as you have a big 4 bank account it takes about a week. If you want a cheque then it takes about a month and also foreign fund cheque took 90 days to clear with a fee ($30odd if I recall right). Cause I was with a credit union, I ended up getting a a cheq for the first time due to the transfer being bounced twice by the credit unions bank (NAB). Second time straight into the ANZ acct , no probs. Did it by both times email and one form completion.

Having never died, D) I can't talk about how it might happen then but if your trustee has the passwords and security question answers it shouldn't be any hassle.

cheers