Trade Markets

by traders and investors alike, to connect with the international financial market, whether that be through Forex, Futures, Options or Stocks. When choosing a broker, traders should do thorough research in order to make smart choices on the selection of the broker that will maximize their benefits, access to additional products and services, and ultimately provide a satisfying experience overall.

While there are no specific details provided for a firm known as "Trade Markets," the following material will outline several key components that define reputable brokers. To illustrate these key components, the author will provide a comparison to Interactive Brokers.

Historical Perspective and Definition of a Broker

Originally, brokers acted as intermediaries that executed trades on behalf of clients located in physical locations. With the technological developments of the last 30+ years, the majority of brokers now operate electronically via electronic trade platforms and/or automated algorithms. The founder of Interactive Brokers, Thomas Peterffy, was one of the earliest innovators to utilize electronic trading using computers and algorithmic trading beginning in 1977 and as a result of that development, other brokerage firms have developed fast, efficient systems to facilitate trades.

Activities and Offerings

In addition to providing clients with access to various trading instruments such as Forex, ETFs, Options, Futures, and Stocks, most brokers also allow clients to create diverse trading strategies that provide traders the ability to build diversified portfolios and become more profitable.

Trading Platforms

Most brokers provide their clients with multiple trading platforms that can be accessed via desktop, the web and mobile applications. The trading platforms provide users with access to live (real-time) market information, as well as, the ability to integrate advanced charting features into their trading strategies. As an example, in 2016, Interactive Brokers introduced a mobile application for Apple Watches.

Trading Account Types

As there are various account types, they will have their own minimum deposits, leverages, and commission structures, thus accommodating different types of traders including beginners, active traders, and institutions.

Regulatory Compliance

The Condition and Technology of the Trading Conditions have been compared by many brokers and generally fall into different pricing ranges and levels of risk controls.

Several different features to Trading Conditions can assist with price control for cost and risk based on various broker dealings. The different technology of the Trading Platform will reflect technological differences in Speed, Reliability, and Access to the Platforms to assist traders.

Features Feature Summary Feature Notes Feature variable characteristics -

Spread Variable Spread start at 0.0 Pips on Major Forex Currency Pairs Variable Spread amounts will depend upon client account type and current Market Conditions Each broker may have different spreads.

Leverage Up to 50 for retail/individual clients, and up to 500 for Professionals The regulatory Leverage position will be regulated based upon designated client's risk control ability.

Minimum Deposit $0 for IBKR Lite account; up to $10,000 for IBKR Pro account Varies by client account type

Available Trading Platforms Desktop Trading and Web Trading, as well as Mobile Trading apps for Smartphones and Tablets. For Retail Clients the Apple Watch app has been available since 2016.

Order Types Market Order, Limit Order, Stop Order, Trailing Stop Order, Algorithmic Order. IBKR supports advanced order routing when using Market Orders and Limit Orders.

Fee Structure

Understanding the different fee structures that exist for brokerages (the commission or known fee to the Brokerage for the trading) is very important for all traders. Interactive Brokers has made significant efforts to create a more competitive pricing structure than has been available previously, including the ability for certain types of accounts to execute commission-free trades, depending on account size and risk control capabilities.

Fee Types Description Notes Extended Definition of Each Fee Type As Per Brokerage Fee Structure -

Comissions From $0 IBKR Lite to $0.005 Per Share IBKR Pro Fees depend upon type of account and specific instrument being transacted.

Deposit Fees None Traders have No Deposit Fees when using Bank Transfers.

Withdrawal Fee 1st Withdrawal per Month will be Free, thereafter there will be a $10 Withdrawal Fee. Fees are determined by Currency and by Method of Extraction.

Inactivity Fee $10 per Month if the Account Balance is less than $100,000 and No Commissions Accrued in the Previous 30 days. Inactivity Fee is not charged to IBKR Lite Account Holders.

User Experience and Reputation

A trader's satisfaction or dissatisfaction with a Trading Brokerage can be shaped by many different factors including the ease-of-use of the Trading Platforms, level of Customer Support, Level of Education and Training available to Traders and the Reliability of the Brokerage's Platforms.

As of today, the Fortune 500 has Interactive Brokers ranked 473rd and they are heavily regarded for the high quality of their Trading Platforms and are heavily relied upon by many professional traders. They also offer multiple retail-friendly products (such as the IBKR Lite account) as well.

Recent Developments/Changes

Industrywide Developments include the introduction of Fractional Shares, Commission-Free Trading and More Advanced Mobile Trading Tools and Platforms. Interactive Brokers introduced the IBKR Lite Account and Fractional Shares in 2019 to increase Trading Activity with Retail Clients and increase accessibility to the Company.

Interactive Brokers' Selling their Timber Hill Market-Making Unit in 2017 is one of many examples of the Company adjusting to Changing Regulatory Environments and changes in Industry Trends.

Conclusion

While many may not have access to all Trade Markets and/or may not always have the detailed information needed on Trade Markets, having a general understanding of the different types of Trade Brokers can help the investor make better Trade Broker selections. In particular, an investor should look to Regulatory Oversight/Compliance, Professional Quality of the Trading Platform, Trading Fee Structures, Trading Conditions and the overall Reputation of a given brokerage within the Financial Community in order to obtain valuable insight into Current Practices and Innovation in the Overall Trading Environment.