Earning Interest on EURO Cash Deposits in Futures Account

CPTrader · Jan 12, 2011

Hello,

Any ideas on how EURO deposits in a futures acoount with a US broker can earn interest. I can buy T-bills, but this will create a US$ debit in the account for which the broker will charge me debit interest, thus negating any interest earned in resulting in an ultimate loss due to the debit interest.

Any ideas on what to do?

Thanks.

nazzdack · Jan 12, 2011

Quote from CPTrader:
----how EURO deposits in a futures acoount with a US broker can earn interest.
----T-bills....
----Any ideas.....

?.....could you deposit "bund", "bobl" or"schatz" secutirities as collateral, similar to US government securities, instead of T-bills?

CPTrader · Jan 18, 2011

Any ideas?!

Quote from CPTrader:

Hello,

Any ideas on how EURO deposits in a futures acoount with a US broker can earn interest. I can buy T-bills, but this will create a US$ debit in the account for which the broker will charge me debit interest, thus negating any interest earned in resulting in an ultimate loss due to the debit interest.

Any ideas on what to do?

Thanks.

CPTrader · Jan 25, 2011

Anybody with ideas??? Thanks!

sjfan · Jan 25, 2011

Your question was already answered by nazzdack - not sure why you keep asking for ideas.

Quote from CPTrader:

Anybody with ideas??? Thanks!

CPTrader · Jan 25, 2011

Quote from sjfan:

Your question was already answered by nazzdack - not sure why you keep asking for ideas.

I need guidance as to how and where to buy European discount bills - i.e. Euro equivalent of T-bills.

sjfan · Jan 25, 2011

You mean like the German Bills? For example, the 4/13/2011 maturity german sovereign bills (ISIN DE0001115715) looks to be around 0.356% on the offer side. If your broker allows fixed income trading, then that's all the info you need. Am I missing something?

Quote from CPTrader:

I need guidance as to how and where to buy European discount bills - i.e. Euro equivalent of T-bills.

CPTrader · Jan 25, 2011

Yes, I'm looking for the German equivalent of T-Bills.

I've been asking my broker as to options and they are still investigating. Hence, my posting here to see what others do or have done?

Apart form German T-bills, do I have any other options?

Thanks.

Quote from sjfan:

You mean like the German Bills? For example, the 4/13/2011 maturity german sovereign bills (ISIN DE0001115715) looks to be around 0.356% on the offer side. If your broker allows fixed income trading, then that's all the info you need. Am I missing something?

sjfan · Jan 25, 2011

Large CTAs sweep their cash in and out of their broker accounts according to the minimum margin requirements on a daily basis so that excess money can be put to work elsewhere (like buying bills, for example).

You can always convert the euro to dollar and then buy US t-bills. But isn't this really a function of what your broker can offer you in terms of tradable markets?

Besides, with short term yield so low everywhere, why even bother?

Quote from CPTrader:

Yes, I'm looking for the German equivalent of T-Bills.

I've been asking my broker as to options and they are still investigating. Hence, my posting here to see what others do or have done?

Apart form German T-bills, do I have any other options?

Thanks.

CPTrader · Jan 25, 2011

Yes yields are low, but 0.35% is better than zero.

I want to keep the cash in EUR, otherwise I would have converted to USD and bought US T-bills and I wouldn'thave even started this thread.

If I can get a broker that can allow me to buy German T-bills and use this for margining in the same way they woudl use US T-Bills for margining, I would be happy. This is what I am trying to achieve.