Can anyone compete with IBs margin rates?

[Saltynuts]

And I look at SPY. It says the fee rate is .25%, I take it annually. But the rebate rate is 1.08%? Does that mean one would get 1.08% to let someone short their stock, but the person that shorts it would only have to pay .25% annually? That really does not make sense to me...

 

[vanzandt]

And I look at SPY. It says the fee rate is .25%, I take it annually. But the rebate rate is 1.08%? Does that mean one would get 1.08% to let someone short their stock, but the person that shorts it would only have to pay .25% annually? That really does not make sense to me...

Because the people who get payed to lend out their stock or contracts, have to own it, ie they can't do it if they hold the security on the margin side of their account. When people short a security, they use margin, so IB which charges about 3% gets to bag the difference (3% - 1.08%) + .25%.
Do that with billions of dollars system-wide.... money for nothin', chicks for free.

Here's that link you wanted btw... https://www.interactivebrokers.com/en/index.php?f=14527

 

[heywally]

I like their futures margins. I don't want IB to go bankrupt because of client accounts.

Total agreement. IB was a much scarier boat to be in with the past lower margins.

 

[CannonTrading_Ilan]

Been with IB for probably not much short of 2 decades. Originally loved them for their super low commissions. But other brokers' commissions seemed to have dropped over time, and I do not know how much of an advantage IB has in that area these days. Bit their margin rates still seem KILLER compared to everyone else I see. Can anyone compete with them? If not, how can IB beat everyone else so soundly?

On the futures side we DO MUCH Better....

 

[tonyf]

On the futures side we DO MUCH Better....

Why not straight forward US equities then?
(and how could your cost of funding be cheaper than IB?)

 

[Robert Morse]

Some of you are talking about the margin required to trade equities/options or futures/options and some are talking about credit/debit interest rate spreads.

 

[tonyf]

Some of you are talking about the margin required to trade equities/options or futures/options and some are talking about credit/debit interest rate spreads.

Possibly, but we are all talking about the same 2.63% charged when borrowing $1m from IB Pro: https://www.interactivebrokers.com/en/index.php?f=1595

We can start by comparing apples to apples...

 

[ids]

So, what gentlemen from Cannon Trading could tell us about the subject?

 

[tonyf]

So, what gentlemen from Cannon Trading could tell us about the subject?

Don't hold you breath for a reply in CAPS LOCK

 

[CannonTrading_Ilan]

Like @Robert Morse said, some of us are talking about futures margins and day trading margins and some are talking about equities lending/borrowing.
Cannon does not offer equities, only futures, options on futures and forex. been doing so since 1988.
Day trading margins for day trading the ES, NQ, YM and many others are $500 per contract!
We use SPAN margins for option sellers.
Crude oil, gold are $1000 day-trading.
Here is the full list.