IB Advisor Friends & Family account

Quote from IB Salvatore:

I'll use the most common case. The advisor has the US non pro bundle.

{snip}

Sub 1 = 20 commissions
Sub 2 = 9 Commissions
Sub 3 = 0 Commissions

Monthly Charges
Master = 10.00 Market data
Sub 1 = 0
Sub 2 = 1
Sub 3 = 10
{snip}
More...

Salvatore:

1)So the Master, as well as the at fault sub(s) always gets hit if any of the subs fails and the $30 minimum is not made?

You show a differential charge of $1 for sub 2. Is that correct or did you drop a 0?

2) To take it to an extreme. A Master and 9 subs. No trades and therefore no commissions over all nine accounts. Would IB bill $100?

Jack

PS - I am a happy IB customer, just trying to get the matter clarified.
 
$30 is only relevant for the advisor market data charge. Each sub account must generate $10 to avoid the monthly minimum.

Market Data Test,
If the summed commissions are > $30 = No market data charge

Monthly Minimum Test,
If the summed commissions are > (funded accounts * $10) = No minimum charges for any accounts.

If the structure fails the monthly minimum test, each account is subject to the $10 charge if they didn't generate $10 in commissions.
 
Quote from IB Salvatore:


Example 1

Sub 1 = 20 commissions
Sub 2 = 9 Commissions
Sub 3 = 0 Commissions

Monthly Charges
Master = 10.00 Market data
Sub 1 = 0
Sub 2 = 1
Sub 3 = 10

own in meeting the $10 minimum. [/B]
More...

Salvatore:

In your example above - Confirm that Sub 2 would be charged $1, not $10.

Jack
 
1) There is no zero missing in the example. The group failed both checks. Sub 2 had $9 in commission so is only charged $1 to meet the monthly minimum.

2) The group would be billed $100 after failing both checks

I apologize for not directly answering your questions in my previous post.
 
No problem. I've never known or seen a reference to the $10 less commisions to determine the billed amount, but then I've always given you guys loads of commissions so I haven't had to research the subject recently.

If I can figure it out, everyone should be able to do so.

Jack
 
We expect to collect $10 from all accounts. Make sure everyone pays something for access to all the free technology. If you have the US bundle, you'll never see a monthly minimum because the $10 market data charge makes the account meet this requirement. It really comes into play for accounts that don't subscribe to market data, sub accounts.

If you do $2 in commission, the charge is $8.........As long as the account is charged $10.
 
Guys,

Just a few questions please:
(If they have already been asked and answered then I apologise)

How is each client account funded for Family & Friends account?

1/ Does each client have their own unique account number?
2/ Is the client the only person allowed to withdraw money/deposit money to their account?
3/ Can the advisor set up IB to automatically deduct fees from each account into the "Advisor" account?

Thanks.
 
Gekko2B:

Funding is by client deposit to IB.

Yes to all three of your questions.

There is one Master Account (the advisor) and then the sub-accounts. Advisor charges are deducted from the sub-accounts and credited to the master. All other funds can only go to the client.

Jack
 
Thanks Jack.

Another question for you.

If a client wants to deposit/withdraw cash from his account, can he just do this without the Advisor even knowing, or does he notify the advisor of his attentions, and then the Advisor can okay the instructions?

How does it work?

Thanks.
 
The client makes a request to withdraw money via the Account Management function. IB then sends an email to the advisor requesting approval. Once approved, IB transmits the funds to the client.

I don't remember the exact time allowed, I think three days, but if the advisor does not act, IB releases the funds without getting advisor approval.

To the best of my knowledge an advisor cannot deny a request. The three day period provides the advisor with time to adjust their strategy with regard to trading in the client's account.

I've never encountered the problem but I assume that a client's withdrawal of funds could result in IB's auto-liquidation of assets to bring an account into margin compliance (IB does not do margin calls).

Jack
 
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