If this routing method is used, the client generally will pay a lower execution fee than client would have otherwise paid. Under certain circumstances, IB may route a marketable order to an exchange that is not currently posting the national best bid or offer (NBBO) but which may be willing to “step up” and execute the order at the NBBO, in order to avoid or reduce the exchange fee for executing the order. IB considers exchange fees and/or rebates in determining where to route an order.
Commissions are not charged for US cabinet buy-to-close trades.Commissions are not charged for US exercise and assignment.Stamp duty on option exercise (UK=0.5%) is directly passed through to the customer.IB does not pass these payments directly to clients. Traditional exchange payment for order flow programs result in payments to specialists or primary market makers, some portion of which may be paid on to IB. Likewise IB does not pass to clients all of the rebates IB may receive for liquidity taking orders, complex orders or orders executed in price improvement auctions. For example, IB may receive enhanced rebate payments for exceeding volume thresholds on particular markets, but typically will not directly pass these enhancements to clients. Likewise, rebates passed on to clients by IB may be less than the rebates IB receives from the relevant market. For example, IB may receive volume discounts that are not passed on to clients. Costs passed on to clients in IB’s Tiered commission schedule may be greater than the costs paid by IB to the relevant exchange, regulator, clearinghouse or third party. Our commission models are not intended to be a direct pass-through of exchange and third-party fees and rebates.
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