IB cash accounts...

On Friday I had full buying power in my cash acct. This morning it was GONE. They had gone back to Thursdays trades over the weekend and debited the account, forcing the 3 day wait after the fact.

Methinks the folks at IB are a bit perverse in the way they are handling this. I think we need to get this under control, as no one likes surprises when it comes to money.
 
It looks to me like the Rule only applies to margin accounts. Also, since settlement is supposedly guaranteed, according to the comment "In addition NSCC eliminates uncertainty in the marketplace by guaranteeing the
financial settlement of transactions which eliminates default risk in the event that one party to a transaction becomes insolvent" one reason I can see why a broker wouldn't clear trades immediately, T+0, would have something to do with float interest profits or losses. Also, government agencies are notorious for saying one thing and then doing another. The only way to be confident in how the SEC is going to interpret and enforce the rule is to wait and see what they really do. Maybe IB is waiting for the dust to settle before they make any promises about T+0.
 
Hi all ,

I read thids tread several times and I'm still puzzled :(

Somebody wrote:

""Can I buy and sell subsequently 1000 shares of CSCO twenty times in a day in a 20k cash account" Yes, regulation T allows that (under certain conditions imo). "

The answer is yes ,because as long as you have the cash in your account ,yes you can buy and sell the stock 20 times (I think).
But my question is after that day ,that you have bought and sold 20 times CSCO ,LETS SAY, do you have to wait 3 days (settlement date) until you can trade again ?

I know guys that this question might have been asked and aswered before but I still didn't get a precise and comprehensive answer.

Please make an example with numbers ! Thanks alot :)

ANGELA.



 
There is a lot of really dumb stuff going on in this business. (Those of you using Qcharts for a while probably know what I mean.)

In the past couple years I have come to regard IB as the other side of the coin. An island of competency and intelligence in a sea of mediocrity. Their latest actions have thrown me for a loop.

I've heard rumors that the SEC has been cracking down hard behind the scenes and promising swift action to any transgressors of their new rules. And IB has a lot to lose. Their small account daytrader contingent is large and growing (until now.) But their other businesses are their bread and butter.

The SEC wields a lot of power and their threats are apparently taken very seriously.

I want IB to succeed, they deserve to. But my own success takes precedence, by necessity.

I'm writing letters to my Congressmen and to IB (and whoever else will listen.) I'm also looking for an alternative in case IB can no longer provide what I need.

Long live Daytrading, it's an honorable profession that makes the marketplace better for everyone!


Richard
 
Angela,

after that day ,that you have bought and sold 20 times CSCO, LETS SAY, do you have to wait 3 days (settlement date) until you can trade again?

I can't answer this for IB (and thought they were not allowing daytrading in cash accounts?), but I can for CyberTrader. They refresh cash accounts in realtime as positions are opened and closed in the same day. The 3-day settlement date only applies if you want to withdraw money from your cash account, but has no effect on daily trading.
 
richard,
I can't really speak for IB on this issue as the US is not my domain and thus have not been remotely involved in any of the internal discussions. However, you hit that nail on the head as far as I am concerned with the regulators. Lets let the dust settle, get firmer interpretation or guidance of the rules and we can go from there.

As for real time updating of buying power in a cash account, I am still of the belief that those accounts are technically margin accounts since the clearing firm would have to put up excess cash on T+3.
 
Guys, IB changed their daytrading comment on cash accounts.

It states now:
Q. Can I day trade in a US stock cash account with IB?
A. Yes, however, stock cash accounts may only trade with settled funds.

Bob
 
Originally posted by Magna
but I can for CyberTrader. They refresh cash accounts in realtime as positions are opened and closed in the same day. The 3-day settlement date only applies if you want to withdraw money from your cash account, but has no effect on daily trading.
More...

As far as I know it is up to the broker to decide. They don't have to, they may decide to.
And I remember Cyber was enforcing restrictions on the realtime buying power [you could not daytrade a stock you did hold overnight.. well you could but the buying power would be impacted very much and you would risk to go under your credit].

I don't recall the exact details, but it is just to point out it ain't as easy as I have $20000 in cash account and I can move $500000 in a day, just because I do many intraday round trips. it is up to the broker.

I am very satisfied with IB. And I expect they will follow a sound policy once the industry gets used to the new (stinky) rules.

neo
 
Richard (rfoulk) You have had some fine posts in this and other threads of late. IB was great because they updated you account within seconds on closing a position and if you were short funds wise even on one penny on a trade they rejected the trade within one second so you were never in any type of margin or suspension gray area. But with these new rules unless you have $30,000-40,000.00 in your account you are just wasting your time! You had better become a futures or options specialist in a hurry. I know this sounds like a record from me folks, but wake up and smell the coffee! Trading as we love it is OVER!! Merrill and the other big boys (including the non Deep Discount firms) had the Regulators in their pocket. They are in the "asset gathering industry" and want to sell you annuities and other "retirement class" products. The fact we were shuttling bucks around daily with them having no control over it was more then they could take. But do as much futures and options trading as you can in the next couple of years, for as one poster didn't quite finish the famous piece "and one day their was a knock on the door and they had come for me".
 
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