Rithmic, CQG or TradeStation: What Your Connection Changes

Ask a room of futures traders what they trade through and you will hear three kinds of answers. Some name their broker. Some name their platform. And a lot of them name a connection: "I'm on Rithmic," "I use CQG," "I trade through TradeStation."

Those three names get used as if they were the same kind of thing. They are not. Rithmic and CQG are technology companies that carry market data and orders between traders and the exchange, on behalf of the brokers that hold traders' accounts. TradeStation is a brokerage that offers its own platforms and its own API. Which one sits behind your screen changes more than the login box. It can change how much of the order book you see, where your risk rules are enforced, who bills you for data and how many programs can use your feed at the same time.

This article walks through what each one is, in the companies' own words, and what actually changes when you pick one over another.

Four Layers Between You and the Exchange

Every futures trade passes through the same four layers, whatever names sit in them.

1. The exchange. For most US futures day traders this is CME Group, which runs four exchanges: CME, CBOT, NYMEX and COMEX. The exchange runs the matching engine and publishes the market data.
2. The broker. In futures this is a Futures Commission Merchant (FCM), or an introducing broker working with one. The FCM holds your account, your margin and your positions, and it is the firm that is responsible for your orders.
3. The connection. The technology that carries market data from the exchange to you and your orders from you to the exchange, with risk checks along the way.
4. The platform. The software on your screen: charts, the DOM, order entry.

Sometimes one company fills several layers. Sometimes each layer is a different company. The confusion starts when a name from layer 3 gets treated as if it were layer 2 or layer 4.

Rithmic: Infrastructure Between Platforms and the Exchange

Rithmic describes itself plainly. In its own FAQ: "Rithmic is a trading infrastructure company. We provide the technology stack that sits between traders (or the platforms they use) and the exchanges — handling market data delivery, order routing, execution, and server-side risk management. We are not a broker and we do not provide brokerage services."

That last sentence matters. To trade live through Rithmic, Rithmic says, "you need an account with a Futures Commission Merchant (FCM) that supports Rithmic." Your broker gives you a Rithmic login; Rithmic carries the data and the orders.

A few things Rithmic states about its service on its own pages:

• Exchanges. Rithmic lists CME Group (CME, CBOT, NYMEX, COMEX), the Small Exchange and Nasdaq (top-of-book equities only), with EUREX available through select FCMs.
• Depth. Rithmic distinguishes top-of-book data, which "provides only the best bid and best ask with their quantities," from market depth, which "provides all price levels the exchange sends." It adds: "Our market depth feed includes MBO (Market-by-Order) data, showing individual orders in the book."
• No throttling. Asked whether it throttles or aggregates data, Rithmic answers: "No. Rithmic provides un-throttled, un-aggregated market data. Every tick is delivered as received from the exchange, with no conflation."
• Server-side risk. Rithmic's Risk Management System "operates at the infrastructure level — on our servers, in the order path — rather than inside a trading platform. This means risk rules are enforced even if a trader loses their internet connection, closes their platform, or their application crashes."
• One feed, one application. Rithmic's connection guides warn: "Connecting two applications to the same Rithmic data feed at the same time will cause the first connection to disconnect." To run several platforms at once, it points traders to Plugin Mode in its own R | Trader Pro application.
• Conformance. Before a platform can connect to production systems such as Rithmic 01, Rithmic says the application "must pass a conformance review."

Rithmic also works with funding evaluators, the firms most traders call prop firms. Its auto-liquidation criteria include loss limits, trailing minimum account balance and end-of-day drawdown, among others. Those are the tools that let a firm enforce an evaluation's rules on its own servers.

CQG: Data and Routing Through Hosted Gateways

CQG is one of the oldest names in electronic futures. Its About page says "CQG began serving United States traders in 1980," and describes the company as a provider of "integrated trade routing, global market data, and advanced technical analysis tools."

Like Rithmic, CQG works through brokers. CQG says it "partners with more than one hundred Futures Commission Merchant environments." Your broker sets up your CQG login and your account sits with the broker.

What CQG says about how its service is built:

• Hosted gateways. CQG provides Direct Market Access "through its worldwide network of co-located CQG Hosted Exchange Gateways."
• A consolidated feed. CQG's market data feed "consolidates data from over eighty-five sources," which reflects its reach beyond US futures into markets around the world.
• Server-side orders. On its trading page, CQG says that "spread orders, orders into aggregated markets, and smart orders are managed on CQG servers co-located with exchange matching engines."
• Redundancy. CQG says it uses "redundant networks designed to ensure that a real-time data stream flows to your platform instantly whenever an exchange records a trade."

CQG also makes its own front-end applications and APIs. When a third-party platform connects through CQG, it uses CQG's data and routing in the same way.

TradeStation: A Broker With Its Own API

TradeStation sits in a different layer. It is a brokerage. Its pages state that "securities and futures trading is offered to customers by TradeStation Securities, Inc.," which it describes as "a futures commission merchant registered with the U.S. Commodity Futures Trading Commission (CFTC)."

So with TradeStation, the broker and the connection come from the same company. You open a TradeStation account, and market data and orders reach other platforms through TradeStation's own API.

What TradeStation says on its own pages:

• Markets. Its futures page lists "Futures access from the CME, CBOT, COMEX, NYMEX, and more."
• The API. TradeStation invites developers to "leverage the same API TradeStation uses for its own flagship applications," with "diverse streaming endpoints, including options chains, market depth, quotes, orders, and positions," and support for order types including bracket and OCO orders.
• Data packages. TradeStation's futures page lists real-time data by exchange, with Level 1 and market depth packages, and sets out the conditions under which those packages are billed or waived.

For a trader, the practical result is one relationship. The same company holds the account, supplies the data and processes the orders.

What Actually Changes When You Pick One

With the layers sorted out, here is what tends to differ in practice.

Who Holds Your Account

With Rithmic or CQG, your account is with an FCM, and the connection is a service that FCM offers. If you change connections at the same broker, your account, margin and positions do not move. If you change brokers, you may keep the same connection type with a new login.

With TradeStation, the account and the connection come together. Your TradeStation login opens your TradeStation account.

How Much of the Book You See

Market data comes in levels. Top of book is the best bid and offer. Market depth adds the price levels behind it, as aggregated size per price. Market-by-order (MBO) data goes one step further and shows the individual orders that make up each price.

Which of these a platform can show you depends on what the connection carries and what your data subscription includes. If order-level detail matters to how you trade, for example to see where your own order stands in line, check that your connection carries MBO data and that your subscription covers depth.

Where Your Risk Rules Run

A daily loss limit can live in two places. It can live in your platform, which only works while the platform is running and connected. Or it can live on the server in the order path, which keeps working when your PC does not.

Rithmic's server-side risk system is built for the second case. In Rithmic's words, "the same risk parameters apply regardless of which platform a trader is using," which is why it suits firms that need their rules to hold on every platform. Your own broker may also apply limits at its end. Ask your broker which limits apply to your account and where they are enforced.

Logins and How Many Programs Can Connect

Each connection has its own rules about sessions. Rithmic's guides say two applications on the same Rithmic data feed will disconnect the first one. If you run one program for charts and another for order entry on the same login, expect that to matter. It often makes sense to run your whole setup in one platform rather than two programs sharing a feed.

Who Charges What

Data fees are where traders get confused most often. Three different parties can appear on your bill:

• The exchange sets the fees for its market data. CME Group publishes its own fee list, with different rates for professional and non-professional subscribers and for top of book versus depth.
• The data provider or broker passes those exchange fees on to you and may add its own charges for its connection or software. Rithmic, for example, says that "all fees are paid in advance" and asks traders to contact its sales team for current pricing. TradeStation lists its data packages and their conditions on its futures page.
• The platform may charge its own license fee, separately from data.

We don't list amounts here because they change. Ask your broker for a current breakdown: which exchange fees you pay, which connection fees, and whether any are waived based on your trading.

A Worked Example: The Same Bid, Three Views

To see why depth matters, picture the bid side of an ES ladder at one moment. The numbers below are invented for illustration, not taken from any real market.

Top of book shows one line:

• Best bid: 5,000.00, size 120

Market depth shows several prices, each with its total size:

• 5,000.00: 120
• 4,999.75: 95
• 4,999.50: 140

Market by order shows what makes up each price. At 5,000.00, the 120 contracts might be:

• 40, 25, 20, 15, 10, 5, 3, 2 (eight orders, oldest first)

Now say you join the bid at 5,000.00 with a 2-lot. In the top-of-book and depth views, all you know is that roughly 120 contracts were there before you. In the order-by-order view, you can watch those orders trade or cancel one by one. If the 40-lot at the front cancels, you know the line ahead of you just got shorter by 40. If an order behind you cancels, nothing changes for you.

That is the practical difference between the levels. Nothing about the trade changes, but what you can know about it does.

Prop Firm Accounts: The Firm Picks the Connection

If you trade a funded or evaluation account, the choice is usually made for you. The firm decides which connection its accounts use and sends you a login for a particular system. Many futures prop firms issue Rithmic logins, and Rithmic names funding evaluators among the firms it serves.

Two things are worth checking with any firm:

1. Which system to choose. Rithmic runs several systems, and a firm's welcome email usually names the one its accounts live on. Picking the wrong one is the most common reason a login fails.
2. Which platforms the firm allows. Firms set their own platform rules. A login that technically connects does not mean the firm permits that platform for an evaluation. Ask before you trade.

A Note on Speed

Speed comes up in every connection discussion, and each company describes its own approach on its own pages: Rithmic its direct exchange connectivity, CQG its gateways co-located with exchange matching engines, TradeStation its direct-market-access services. Those descriptions are worth reading, but they are hard to compare from the outside, and the delay you actually experience also depends on your internet route, your PC and your platform. The practical features above (depth, where risk runs, session rules, fees) are things you can check for yourself before you open an account, so they make a firmer basis for a decision.

Checklist: Questions to Ask Before You Choose

• Who holds my account? An FCM through Rithmic or CQG, or TradeStation directly?
• What depth does my subscription include? Top of book, market depth, and is market-by-order data part of it?
• Where are my risk limits enforced? In my platform, on the connection's servers, at my broker, or a mix?
• How many programs can use my login at once? And what happens if a second one connects?
• Which system do I pick? Especially for prop firm logins, which name a specific system.
• What will I pay for data, and to whom? Exchange fees, connection fees and platform fees, each listed separately.
• Am I a professional or non-professional subscriber? Your answer changes your exchange data fees, so certify honestly with your broker.
• Does my prop firm allow my platform? Ask before you trade an evaluation on it.

The Bottom Line

Rithmic, CQG and TradeStation are not three versions of the same product. Rithmic and CQG are infrastructure your broker provides; TradeStation is a broker that also provides the connection. The differences that matter day to day are practical ones: how much of the book you can see, where your limits are enforced, who you pay for data and how your logins behave. Know which layer each name fills in your own setup, and most of the confusion goes away.

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About TradeStation: NexTick360 is not affiliated or associated with, or a partner of, or an agent, representative, delegate, associated person or introducing broker for, any TradeStation company. The products and services offered by NexTick360 are not sponsored, endorsed, sold or promoted by any TradeStation company, and TradeStation makes no representation regarding any products or services offered by NexTick360. Equities, equity options and commodity futures products and services are offered by TradeStation Securities, Inc. (Member NYSE, FINRA, CME and SIPC). Orders are processed by TradeStation Securities, Inc.; order entry is provided by NexTick360.

NexTick360 connects to your own broker account through Rithmic, CQG or TradeStation, with market data and orders as separate connections so any data source pairs with any order route, and prop firm accounts connect through Rithmic. Find your broker or prop firm