MB Trading (www.mbtrading.com) Review

MB Trading was one of the original direct access brokerage firms, born out of professional traders' frustrations with discount brokerages such as E-trade and Ameritrade. The firm was founded in 1999 by Ross Ditlove and Steve Demarest, and has received fairly warm reviews since their inception. Traders that I talk to say that if you are a semi-active trader, then MB Trading is the solution for you, but if you are a super-active trader, then you should probably look elsewhere.

Direct Access Technology allows you to bypass the middlemen and trade directly with the markets. This means usually instantaneous executions and enough bells and whistles to keep a trader happy. If you are planning on day-trading, you need Level II quotes, real-time watchlists nad real-time charts. MB Trading provides you with all three.

MB Trading offers stocks, options, and futures trading. For stock trading, MB Trading offers three different plans to choose from in terms of commissions. First, there is plan A, which charges you 1 cent per share up to the first 500 shares, then $0.005 per share after that. So a 1000 share buy order would cost you $7.50. Then, there is plan B, which charges you $9.95 per trade plus routing fees. Then, there is the newly issued Plan C, which charges traders a flat $4.95 per trade, but will only route the trades to the MBTR order route, meaning that you can not self-direct your own trades under this commission plan. This plan would appeal more to the less active traders. If you are an active trader who wants the flexibility to route his own trades, go with plan A.

Level II quotes are free if you maintain a $25,000 daily balanace or trade 10,000 or more shares per month, otherwise they charge you $10 per month. There is no charge to use the actual software package.

MB Trading requires $1000 to open a cash account, $2000 to open a margin account, and $500 to open an IRA account. MB Trading can not open accounts for people in some countries in the world (including Canada) so please check the list on their site before you attempt to sign up.

On Elitetrader.com, MB Trading has a 70% approval rating, and 30% disapproval rating. To balance that out against their competition, Cybertrader has a 71% approval rating and Tradestation has an approval rating of 69%. So they are fairly even with their competition.

I have never used the MB Trading platform myself, but if you are a Cybertrader customer, you should be aware of the alternatives, as Schwab is soon to be migrating you to their own software platform, which will surely not be a good thing. You may want to look for alternatives.

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