Why is my option commission so high?

Discussion in 'Interactive Brokers' started by LM3886, Oct 26, 2021.

  1. LM3886


    I'm on IB's tiered commission structure, but the per-contract commission is no where close to $0.65. Often times, I got charged almost twice of that:
    Screenshot at 2021-10-26 14-42-38.png

    I'm curious if people are paying similar commissions? Or is there something I can tweak to reduce them?
    morganpbrown likes this.
  2. FSU


    You are paying to take liquidity. Depending where your order is routed, some exchanges will charge you to take liquidity, some will give you a rebate to provide liquidity and some will not charge or pay. You can adjust the smart router to maximize rebates, best fills, etc. If you select max rebate, your fill quality may suffer.
    murray t turtle likes this.
  3. Robert Morse

    Robert Morse Sponsor

    FSU-Changing to max rebate can mean missing trades if the only offers are on exchanges that charge. Our SMART route can avoid most option exchange fees using Sterling Trader Pro, RealTick or Silexx. As we do not track option exchange fees on Lightspeed Trader, we charge a flat extra fee on cash settled indexes and options on ETFs. https://www.lightspeed.com/pricing/routing-fees/.
    NumberZ, murray t turtle and Baron like this.
  4. LM3886


    I don't think I was taking liquidity, because I placed my order at mid of Bid and Ask and it took minutes for the order to fill.
  5. Robert Morse

    Robert Morse Sponsor

    Was it a spread?

  6. LM3886


  7. Robert Morse

    Robert Morse Sponsor

    I can't confirm it, as it has been a while since it happened to me, but many years ago I was told by IB support at that if my order is not marketable at the time of entry, the spread is held on their server until marketable. The same thing happened to me after 2 hours. I was charged for taking liquidity.
    murray t turtle likes this.
  8. LM3886


    That's interesting. I also have a TDA account, which charges ~$0.65 per contract pretty uniformly. Are they paying the liquidity taking fees for me?
  9. taowave


    I left IB for the very same issues you brought up....

    I was getting hit for 6 bucks per fly...

    Went to TOS and never looked back
    NumberZ and LM3886 like this.
  10. JSOP


    $0.65 is just the per-contract commission as far as I can remember. Option trades carry lots of other charges that goes to whole bunch of regulatory bodies, the OCC, FINRA and etc. IB has a whole page on commissions on options on its website. It's a fascinating read.
    Last edited: Oct 26, 2021
    #10     Oct 26, 2021
    murray t turtle, jys78 and LM3886 like this.