6:1 margin for overnight stock positions at InteractiveBrokers

Do you want IB to allow portfolio margin for accounts <100,000$

  • Yes

    Votes: 77 58.8%

  • No

    Votes: 54 41.2%
  • Total voters
    131
M

maos

Did you know that by switching to Portfolio Margin rules ( from RegT rules) at IB you get as much as 300% increase in capital available for trading (margin)?

This can significantly improve trading results for anybody who is profitable and uses prudent money management!

The problem is they allow it only for accounts above 100,000$

Please vote at
Interactive Brokers Features Poll to be able to use it if your account is <100,000$

just enter maros in Find by contributor: field to find the feature to vote for...
 
Quote from maos:

Did you know that by switching to Portfolio Margin rules ( from RegT rules) at IB you get as much as 300% increase in capital available for trading (margin)?

This can significantly improve trading results for anybody who is profitable and uses prudent money management!

The problem is they allow it only for accounts above 100,000$

Please vote at
Interactive Brokers Features Poll to be able to use it if your account is <100,000$

just enter maros in Find by contributor: field to find the feature to vote for...
More...

Very unlikely - as day trading rules still exist with the $25.000 threshold. Therefore - brokers need a decent cushion above $25K.

IMO - customers should be grateful that it is $100K as IB got an exception to a portion of the Portfolio Margin rule.

Perhaps it will be lowered in the future but it wouldn't come down by much.

Also - the margin requirement may not be as low as you think as there are exceptions to the 15% requirement - ie if all positions are tied up in one security - (and for a smaller account that seems more likely) - would probably require 50% margin in Portfolio Margin accounts
 
Quote from mskl:

Very unlikely - as day trading rules still exist with the $25.000 threshold. Therefore - brokers need a decent cushion above $25K.

IMO - customers should be grateful that it is $100K as IB got an exception to a portion of the Portfolio Margin rule.
More...

Please explain what you mean. Portfolio margin is a right way to calculate the margin since the risk of a portfolio is lower and consequently requires smaller margin than if charged for individual products. People are overcharged under Reg-T.
How come IB is an exception if optionsxpress have the same $100K limit?
 
Quote from gkishot:

Please explain what you mean. Portfolio margin is a right way to calculate the margin since the risk of a portfolio is lower and consequently requires smaller margin than if charged for individual products.
How come IB is an exception if optionsxpress have the same $100K limit?
More...

they got an exemption to a "portion" of the rule. re read my post.


http://www.interactivebrokers.com/en/trading/marginRequirements/PortfolioMargin.php?ib_entity=llc

read. Don't be afraid to do some of the work yourself.
 
As far as I can see 100k is totally arbitrary restriction put on by IB. I don't see any reason why this amount can not be lowered significantly given that "depending on the composition of your trading account, Portfolio Margin can require less margin than under Reg T rules, which translates to greater leverage."
So I still don't see your point.
 
Quote from mskl:

Very unlikely - as day trading rules still exist with the $25.000 threshold. Therefore - brokers need a decent cushion above $25K.

IMO - customers should be grateful that it is $100K as IB got an exception to a portion of the Portfolio Margin rule.
More...

Quote from mskl:

they got an exemption to a "portion" of the rule. re read my post.
More...

If i got it right...

the only exemption mentioned on the page is related to exemption from RegT day trading rules for those who are approved for portfolio margin
 
Quote from gkishot:

As far as I can see 100k is totally arbitrary restriction put on by IB. I don't see any reason why this amount can not be lowered significantly given that "depending on the composition of your trading account, Portfolio Margin can require less margin than under Reg T rules, which translates to greater leverage."
So I still don't see your point.
More...

yes - it is arbritrary - however one should be grateful that it is only $100K. Think about it.

If you set the amount at say $50K and allow the increased leverage (which can be much larger than what you descirbe) and the account falls below $25K and reverts to a Reg-T account - it becomes a nightmare. Brokers/customers should have a safety net - where it isn't easy for your account to go from a PMA account to a Reg-T account.

It is also possible that Regulators allowed the exception I referred to for IB - not only because they have real time margining but perhaps because the threshold wasn't so low.

You can ask IB - but I'm 99% certain that they will not lower that amount any time soon.

Good Luck
 
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