Online Broking Is Set To Change In Australia For Stocks, Options, Futures & Forex

There are many different variables to selecting the right online broker or trading platform. We all have different needs and different expectations. Some of the main points to consider are Fees, Trading Platform, Terms & Conditions, Customer Service and Account Statements. One point often not considered until it’s too late is broker / advisor knowledge, especially when dealing with derivative products.

Recently a friend of mine (Tom) was using a large investment bank as his full service broker and called the trading desk to roll some long call options into a further dated call spread. Tom instructed the advisor to roll into a longer dated call spread for a net even price. The advisor informed Tom that the trade could not be executed as a single order, and insisted that he close the original position and then buy the longer dated spread. The advisor also informed Tom that a senior advisor will need to take the 2nd half of the order as he was not authorised to trade combination orders. After some debating, the position was closed and before the senor advisor could take the 2nd half of the order that stock jumped 28% (due to takeover rumor). The calls which were sold had now increased by a further $55,000 and Tom was not in the longer dated call spread.

The above is an example of an advisor providing the wrong information and probably not wanting to loose out on a large commission ticket insisted to execute part of the order. �

Differing from full service brokers are online brokers who charge a commission based on the number of trades and most even charge for advanced orders such as stops and contingent orders. I have come found a new trading group in Australia called Enfinium . They offer an online execution trading platform at discounted commissions on over 80 markets worldwide with no account keeping fees. They provide advanced orders for all markets and do not charge extra fees to use such features. The group also offers Funds Management in the form of Managed Discretionary Accounts MDA’s, currently invested through a Global Volatility technique. The fund is currently returning approx 30%pa. The online trading platform is through Enfinium International and the Funds Management is through Enfinium Capital Management .

Enfinium International provides the trading platform for free. The only cost is in the form of data, based on what markets you subscribe to and of course the commissions. Currently there is zero commission on option exercise and assignments on the Australian market. This in itself could save any option trader hundreds of dollars per month.

In summary, it pays to shop around and if your not happy with your current broking service try someone new providing a specialized service.

Leave a Comment