Switching from TradeStation to IBKR
By Dave Mabe
One of the traders I'm coaching just switched from TradeStation to Interactive Brokers.
They both offer an API to trade through, but IBKR's is vastly superior and has been for years.
The main game changer for this trader was the way IBKR handles partial fills with orders in an OCA group.
Think about using a limit order for entry - there's no guarantee that it will be fully filled.
You might get a few shares now, then a few shares later, then more shares a little later still.
At each partial fill, your exit orders should update to reflect your current position - otherwise your position is unprotected.
Implementing this logic on the client side is tricky.
The nice thing about IBKR is that all this logic is implemented on the server side.
All the partial fills automatically update the exit orders appropriately.
On the entry side and the exit side.
Why is this important?
Think of the tail risk - what's the worst thing that can happen? (Asking this question is a huge part of your path to confidence!)
In the context of orders, it would be your client machine sending an entry order, having it filled, then your power experiencing an outage at the exact moment of entering your exit orders.
With the way the IBKR orders work (and if you know how to use them properly), there is zero chance of this happening.
With TradeStation, there are multiple order states where this vulnerability exists.
How likely is it that your power goes out just at this exact moment?
Not very! But that's not the point.
When you start trading with size, these kinds of rare occurrences become important to consider.
This is the exact reason I still send most of my trades through my IBKR account after all these years.
And the trader I'm working with just had the same a-ha moment last week.
-Dave
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