Mark Holstius Elite    Posts: 744 Joined: 10/11/2012 Location: Sleepy Hollow, IL  User Profile | Thanks again for your posts - you've addressed 2 very important questions: 1) The effect of commissions overall (MB vs IB specifically) 2) The effect of commissions on performance when using lower account sizes when a portfolio like mine trades a lot at lower allocations. In my last post I recommended that everyone look at using IB for their commissions and help with the 3 day rule in an IRA - especially with any portfolio that trades a lot using small allocations. I went back to your post on the 8th where your jpg snag showed you were using MB commissions of $6.95 / trade. I then did a few runs using the FTM Rev06 in an IRA (Max % of equity 95%) with MB and IB commission settings. The results (below) are very informative - all using FTM Rev06 for the last 5 years; IRA Using 2% / Trade, $10,000 Equity, and your MB Commission Settings; IRA Using 2% / Trade, $10,000 Equity, and IB Commission Settings; IRA Using 4% / Trade, $10,000 Equity, and your MB Commission Settings; IRA Using 4% / Trade, $10,000 Equity, and IB Commission Settings; There’s really no debate - the commission structure has a serious effect on performance when using FTM Rev06. The performance is quite reasonable in a $10,000 IRA if you use a 4% allocation / trade, so I did another 2 runs in an IRA funded to $20,000… IRA Using 4% / Trade, $20,000 Equity, and your MB Commission Settings; IRA Using 4% / Trade, $20,000 Equity, and IB Commission Settings; Again, it’s obvious that IB is the way to go due to the commissions when using my FTM Rev06. The efficiency and stability of the account also improves with size. Using a portfolio that trades a lot using small trades presents some interesting challenges. I hope these comparisons help to illustrate the effects of commissions and account size when using my FTM Rev06 - and any portfolio that trades a lot. Mark [Edited by Mark Holstius on 7/10/2017 2:01 PM]  Attached file : 02 5 Year MB Commissions Alloc04.png (162KB - 713 downloads) Attached file : 03 5 Year IB Commissions Alloc04.png (117KB - 716 downloads) Attached file : 04 5 Year MB Commissions Alloc04 20K.png (172KB - 675 downloads) Attached file : 05 5 Year IB Commissions Alloc04 20K.png (116KB - 745 downloads) Attached file : 00 5 Year MB Commissions Alloc02.png (161KB - 730 downloads) Attached file : 01 5 Year IB Commissions Alloc02.png (114KB - 690 downloads) |
