In this article, we’ll compare some of the biggest trading platforms out there by looking at Interactive Brokers, Fidelity, & Paradigm Futures. We’ll walk you through each platform’s strengths to ensure you get the best one for your company’s needs.
Paradigm Futures, Fidelity, & Interactive Brokers lets you trade different asset classes, like stocks, futures, and options.
Futures, options, and stocks are asset classes that can be traded for various purposes. Futures and options are great ways to ensure access to certain assets at a given time.
Summary
However, after comparing Interactive Brokers, Fidelity, & Paradigm Futures, we believe Paradigm Futures offers the absolute best trading platform you’ll love. It’s because of the outstanding support offered through the platform. Low-volume traders may find Interactive Brokers & Fidelity appealing. Still, when you start trading higher volumes, it becomes clear that Paradigm Futures is the best trading platform.
In comparing Interactive Brokers, Fidelity, and Paradigm Futures, we seek to highlight their strengths and weaknesses when trading things such as coffee, softs, & corn.
| Interactive Brokers | Paradigm Futures | Fidelity | |
| Rate | ✅✅✅ | ✅✅ | ✅✅ |
| Accessibility | ✅✅✅ | ✅✅✅ | ✅✅✅ |
| Information | ✅ | ✅✅✅ | ✅ |
| Equity Security | ✅✅ | ✅✅✅ | ✅✅ |
| Total | 9 | 11 | 8 |
Interactive Brokers vs. Fidelity vs. Paradigm Futures: An overview
Interactive Brokers, Fidelity, & Paradigm futures have important differences that set them apart regarding your trading experience. These differences include the following:
- Their rates
- Accessibility
- Access to information
- Equity security
All three companies offer trading platforms for retail investors where securities are bought and sold. The different companies have various tools available, with some unique to the specific platform.
Various tools help you analyze portfolios to ensure you create the investment strategy that fits your objective.
Before we get further into the comparison, it’s important to establish certain things.
What are futures?
When you trade futures, you are legally tying yourself to the possibility of having to receive the underlying asset at a certain point. It’s a legally binding contract wherein a number of units of a specific commodity are agreed to be received at a certain time.
To trade futures, you need to go through a futures exchange. Through those, you will have access to open positions and create positions with futures contracts. As they’re standardized, they’re easily tradeable asset classes for speculators and hedgers to take positions out on. By doing so, ownership is moved from one person to another, as are the responsibilities.
Various different parties trade futures:
- Speculators
- Storage facilities
- End-users
- Producers
Storage facilities, end-users, and commodity producers are all at risk of price movements in the market. Trading futures is a way for them to mitigate that risk. Futures benefit various users, like the farmer. Without a futures contract, he would have to incur all the expenses related to farming without any of the revenue.
Corn is harvested in October, but the farmer has to start the process a lot earlier to achieve that. Inputs must be purchased in the winter and spring, many months before they can harvest the crop. All these expenses accumulate.
With the use of futures contracts, the farmer can sell an obligation to deliver on the contract before the corn is even planted, giving him the cash flow to be able to buy the necessary input for the operation. By using a futures contract, the farmer is compensated a fair price for their product.
Speculators are also common in futures trading as they see what they believe to be opportunities in asset classes when something is either overvalued or undervalued. They’re an important part of the futures market. While they temporarily own the contract to have a commodity delivered, they never intend to hold the contract when the good is delivered. Speculators can make money when prices are going either up or down, assuming they get the direction right. They’re an important part of providing liquidity.
Futures are not the only asset classes that can be traded, but they’re big ones. There are various platforms where you can trade these asset classes, and we want you to make a better decision when you start trading.
Interactive Brokers
Interactive Brokers is a discount broker listed on the stock exchange. While they’re able to give you a lot of options for little money, that’s all you should expect. They’re the cheapest broker out there but also the one with the least support.
However, the quality and research they provide is very limited.
Here are the scores for rate, accessibility, information, & equity security for Interactive Brokers:
- Rate: 3
- Accessibility: 3
- Information: 1
- Equity security: 2
Paradigm Futures
Paradigm Futures and its platform is a partnership between futures trading company RJO and broker service company Paradigm Futures. While the fees may originally be higher, you get what you pay for with superior service.
Here are the scores for rate, accessibility, information, & equity security for Interactive Brokers:
- Rate: 2
- Accessibility: 3
- Information: 3
- Equity security: 3
Fidelity
Fidelity s a big company that offers various services, like banking. The advantage to that is that you can put your money in the Fidelity system before you’re even investing.
Unlike Paradigm Futures and Interactive Brokers, which are mainly brokerage companies, Fidelity offers a suite of products. Some of the investment products offered by Fidelity include:
- Mutual funds
- Exchange-traded funds (ETFs)
As pure trading platforms, Interactive Brokers and Paradigm Futures do not offer their own investment products. However, it’s important to note that Fidelity does not offer futures trading.
If that’s the asset class you hope to trade, you will want to consider either Paradigm Futures or Interactive Brokers.
Here are the scores for rate, accessibility, information, & equity security for Fidelity:
- Rate: 2
- Accessibility: 3
- Information: 2
- Equity security: 2
What to look for
When it comes to choosing the right trading platform, there are several things to look out for. Let’s walk you through them and give you a better understanding of what to look for.
Rates
Comparing rates across different trading platforms may seem easy at first. However, it’s important to know the limitations when doing so. Some platforms will seemingly have very low rates, which may be the right choice for some.
However, these discounted rates are usually a low-touch, low-insight strategy to get you hooked. Some trading platforms, on the other hand, charge higher rates but deliver significantly higher levels of support and user experience. These higher-rate platforms usually provide broker-assisted platforms in return.
You get what you pay for. It’s no different from choosing a restaurant. Some people choose to spend more because they wish to have a nicer experience, interacting with highly-professional staff.
While it may be tempting to go for the lower rates, it’s not always how you get the best service. Interactive Brokers is one of the companies that prides itself on starting with a $0 commission structure.
It’s great for businesses to start off with, but it doesn’t mean everything is free. While advertising $0 commission, they have desk fees, risk fees, and fees for breathing (okay, that’s an exaggeration). All these hidden fees add up as you’re trading.
Fidelity does a lot of the same stuff as Interactive Brokers. The initial deep discount seems like an appealing way to trade until you need something additional.
Paradigm Futures offers more transparent trading at a standard $65/round for futures and options. It’s a company with a vested interest in you doing well. With brokers on staff, they can help you no matter what. They also offer different structures for self-directed accounts and accounts with higher trading volumes.
Accessibility
You can access the markets straight from your preferred device, whether it’s Fidelity, Interactive Brokers, or Paradigm Futures. All it takes is for you to have internet.
24-hour access gives you the ability to make the trade when you want to. No additional charges are incurred when trades happen between 7:30 am and 7:00 pm central standard. Night desk fees apply outside those hours and are $3/filled contract. The structures at Fidelity and Interactive Brokers are similar.
Information
Through Paradigm Futures, you’re able to access unprecedented market insights provided by RJ O’Brien. Their network is the result of being the oldest and largest private FCM in the US, ensuring you get access to the data you need. Hedges and speculators will appreciate being able to utilize the various charts they offer.
Government reports are conveniently pulled, analyzed, and made available, allowing you to access the most up-to-date information.
Access to information is much more limited when it comes to Fidelity and Interactive Brokers. Their mantra is keeping costs lower. Without access to information, you’ll be making trading decisions in the blind. Physical markets shift, and you need to be able to make the best decisions.
Equity security
To start trading, you often put substantial amounts of money in the hands of companies you may not know much about. Newer companies come into the space and are being paraded as disrupters. However, is the case of FTX really a case of disruption or something more sketchy?
When times are uncertain, you want to know that you can pull out the money when you need to. As the oldest platform offering futures trading, backed with access to information provided by RJO, joining a broker partnership between Paradigm Futures and RJO is the right way to go.
