Alternative Investments

[KrispyKreme50]

Most brokers only offer equities, bonds, and mutual funds to trade while a select few seem to offer futures. If I wanted to buy an investment such as a credit default swap, where would I need to go? You hear about these things all the time but are they even available to retail traders like me or do you need to get a broker like GS Prime? As always, thanks for any reply.

 

[ChaosNSX]

Citigroup has them, but why would you want them now?

 

[Xuanxue]

Quote from KrispyKreme50:

Most brokers only offer equities, bonds, and mutual funds to trade while a select few seem to offer futures. If I wanted to buy an investment such as a credit default swap, where would I need to go? You hear about these things all the time but are they even available to retail traders like me or do you need to get a broker like GS Prime? As always, thanks for any reply.

Per IB:

The current turmoil and uncertainty in the U.S. markets originates almost entirely from “over-the-counter” products like mortgage-backed securities and credit default swaps that are customized, bilateral contracts that are not traded on an exchange and are not centrally cleared. IB and Timber Hill and their affiliates do not trade these products because they are often illiquid, cannot be valued or marked to market and are only as good as the banks or brokerages or underlying mortgage holders that are on the other side of the contract. The balance sheets of the banks and brokerages that have substantial holdings of these OTC products therefore are subject to great skepticism because the products cannot be valued and often cannot be traded. IB and its affiliates do not own any of these instruments on (or off) their balance sheets.

http://www.interactivebrokers.com/en/general/education/faqs/safetyFAQ.php?ib_entity=llc#4