Thank you @dsrtegle for your questions about FCM (Futures Trading Commission) selections and at the same time the opportunity to earn your futures trading business. Also, thank you to @project11 for ongoing support and details provided.
It is hard to find a match for a customer unless we know the following:
- Account Size or type (IRA, LPOA, CTA, Self-Directed, etc).
Futures Trading Technology Required ( Actual front end and the API associated-Data Feed)
- Risk Appetite (margin necessary)
We always prefer to discuss this over the phone because we always unveil details that would allow us to find in our opinion a near perfect match. Please call us at 1-800-771 6748 or local at 561-367-8686. email firstname.lastname@example.org
Having said all of the above, I also want to provide a few general points that would allow you to understand what drives certain FCMs and their business model when it comes to customers, risk and execution.
First, large FCMs such as ADM (ADMIS)/Wedbush that we carry are involved in numerous operations such as hedging, Managed Futures, Give Ups, Allocations, and Self-Directed Trading. Due to their size, they carry large corporations on their books, large net-worth individuals, and smaller accounts. When it comes to risk, they are conservative and do not allow margins such as $500 for day trading. They allow 50% day trading margins, and at times if the customers have a really good history of trading they will allow 25% for day trading margins. The customers that are attracted to these FCMs are conservative in their nature, and the size of the organization gives them a feeling of safety. Also, their back office deals with multi-account allocations, Limited Power of Attorney Accounts, Managed Futures, and carry a multitude of technologies that are known to the public such as CQG, Rithmic, CTS, TT and more institutional driven ones such as Stellar, Fidessa, APEX, etc. Lastly, larger organizations have a highly efficient trading portal with immediate reporting.
The second issue is the front end and the corresponding data feed that comes with it. There are those who need one data for futures and commodity charting and one for execution, and as such, they want to keep the two separate. There are those who want to have all in.
We at Optimus Futures try to find the best combination for your trading requirements. Also, consider that we always try to be very cost conscious because the CME does charge for data, so our goal is to avoid paying the CME for data fees. They are not big, but they add up over time. For example, you can have Rithmic for multiple futures trading devices, and see all accounts under one. Many people like their data feed because it is unfiltered, not aggregate, and those who scalp may need such data. However, they charge for their data $20, and for many, it is worth it. OEC Data could be applied across multiple devices, and they do not charge for their data. CME Fees for data are different of course. CQG as far as we know could be extended only to two devices at the same time but they charge for each user they create.CQG wants a different ID for each platform. At AMP Clearing, They provide CQG credentials for many CQG devices, and they do not charge for their CQG devices.
Lastly, your risk appetite has to do with your risk capital and risk tolerance. We have a fiduciary duty not to advocate the overuse of leverage as it does not put the odds in your favor. Nevertheless, we respect the fact that many need $ 500-day trading margins because they carry small amounts for trading. Consider carefully how many contracts you need to hold for your day trading and decide whether you need such margins. As a general statement, smaller FCMs-in order to be competitive offer lower day trading margins.
Gain Capital and AMP would serve you well from that perspective.
As @project11 suggested, as an introducing broker we bridge the gap of knowledge and support for many futures traders. Like yourself @dsrtegle, we receive many customers from other FCMs and IBS because they always missed an element that the futures trader may need and is crucial for their operation.
If you have additional and specific questions about FCMs, I would be more than happy to address that. If you have data feed questions, please open a new thread.
Just as summery, at the moment we have clearing arrangments with ADM, Advantage Futures, AMP, Gain Futures, and TS.