Forex vs ETF

N

nravo

Do I have this right? Let's say 300 shares of FXE costs about $42,000 and costs me roughly $21K in margin. The $42,000 EUR via Forex, however, say at IB, costs me about $2K in margin?
 
Quote from Surdo:

Spot Fx is generally 100:1 leverage as are Fx futures in ECZ07, $2,025 will buy you 1 contract worth $142,760.
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Is that how it works on Forex Pro at IB? Contracts? Not cash amounts? So if I place an order to buy $30,000 AUD, the minimum, I have bought a boatload of contracts on margin? Or have I bought $30K AUD/USD and only used about $300 in margin?
 
Quote from Surdo:

Spot Fx is generally 100:1 leverage as are Fx futures in ECZ07, $2,025 will buy you 1 contract worth $142,760.
More...

I assume you meant $178,450.
 
Quote from nravo:

Is that how it works on Forex Pro at IB? Contracts? Not cash amounts? So if I place an order to buy $30,000 AUD, the minimum, I have bought a boatload of contracts on margin? Or have I bought $30K AUD/USD and only used about $300 in margin?
More...

No, it is cash, not contracts. 2% margin, not 1%, for the majors at IB.

http://www.interactivebrokers.com/en/trading/marginRequirements/margin.php?p=fx&ib_entity=llc

The margin in both of your examples (EUR and AUD) is incorrect... see if you can post the correct figures.
 
So I can take, say a $50,000 position in the Euro for $1,000? Why on earth would I do an ETF and eat up all that capital?
 
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