Quote from 168:
oanda's rate is the best i have found so far, i get $1.05 everyday for my 10k account .
Quote from KS96:
disguistingly profitable...
And even more disguisting is that they don't
have the decency to comment on the issue.
Deliberately not mentioned at their web-pages.
Those are the hidden costs of forex!
I am alerting any Forex trader to check
how bad and ugly his interest "haircut" is.
So far, the fairest deal seems to be Oanda.
Quote from IBj:
The end of the forex clearing day is 1700 EST. Cash balances for interest are determined after that. Please note however that we calculate interest on settled balances, not trade date balances so trades done on monday settle on wednesday and are counted, but trades done on tuesday or wed are not counted in wednedsay night's interest. Lastly, please note the holiday rules for FX: settlements that fall on a holiday in either currency push settlement out a day.
[/B]
Quote from KS96:
I am not sure I understand how this works....
If I make a single day-trade (in-and-out before 1700EST
e.g. on Monday, I am still credited/debited interest until
the trade settles (i.e. Wenesday). Right?
Quote from IBj:
'Disgusting' is how one describes bad food, not an inability to find information. [/B]
Quote from IBj:
The trades you do on Monday only settle on Wednesday (for most FX pairs). Since you neither pay nor receive funds for Monday trades until Wednesday, they will have no bearing on the Monday (or Tuesday) night balances for purposes of interest. There is an explanation on settlement day principles on the link I cited.
Example:
monday AM: acct has 100K USD
monday: sell 100K USD, buy 83K EUR
Monday closing *settled* balance = 100K USD, 0K EUR. You will earn interest on your USD.
Wednesday: monday trade settles, balances are: 0K USD, 83K EUR
Wednesday close: interest will be credited for 83K EUR
Quote from KS96:
Sure. Yet, a single word can bring an almost
buried thread into life.
Another question:
Since IDEALPRO is an ECN, it's possible that a forex
trade takes place between two IB traders.
Why this trade settles after 2 days and not immediately
(or at least at the end-of-day)?
It's just money transfered between 2 IB accounts.
You could save us the ugly interest "haircut"....
As for the "industry standard"... the industry has been
changing fast...
If your point is the interest on tiny balances, then it is simple: IB doesn't pay interest on balances under 10K. Please note that we are talking about something like 1$/day. To be honest, IB's platform is targeted to professional traders, or traders with a professional's priorities. It is feature rich, and like most feature-rich systems, reasonably complex. While we don't turn away small balance accounts, our interest model does not target that audience. Remember, it is not the rate that matters (you can't buy a pair of jeans with a 'rate'). It is the amount of money that matters and the amount of interest on small balances is a small amount of money. Our rate model is optimized for clients with large balances where the actual amount of money involved in even a 20 basis point difference can be substantial.Quote from KS96:
OK, this sounds too good.
Monday + Tuesday you still receiving interest on 100K USD.
From Wednesday on, you start receiving interest on 83K EUR.
Everybody happy.
However, it's not a realistic forex trade at all.
You assume someone just changing his 100K USD to EUR.
The trade doesn't even need margin!
Try this:
monday AM: acct has 1K USD
monday: buy 25K EUR/USD
what happens?