IB Exposure Fee
- Thread starter mastacoli71
- Start date
I received the following response from IB CSR:
OK, great. Now we need a distance, speed & acceleration module for that steamroller.
This is the explanation from IB for the fee.. It is just to make you aware of a unlikely event..... So no additional guarantees for anyone......
The charge will be calculated every day based on the previous day exposure. If you close today a position and you have no exposure anymore, there will be no fee, however, if you open a new position with a new exposure, we will again charge.
You need to look at the -30% row in the stress test, if there is an exposure you will need to pay based on that exposure.
If for example you have 100000 on the account and your PNL at -30% is -150000, your exposure will be -50000
A stress test is a very simple calculation, it checks the extreme market situations and basically looks at the unlikely event. However, this unlikely event has a very large financial impact, to the point of putting a customer into the situation were you owe us as Broker money.
We do not want to increase the margin because it is an unlikely event, however, we want to make clients aware of that possibility and charging a fee is a way of doing it.
At this link on our website you can see further info on the Exposure Fee: LINK../index.php
Kind regards,
xxxxx
IB Customer Service
The charge will be calculated every day based on the previous day exposure. If you close today a position and you have no exposure anymore, there will be no fee, however, if you open a new position with a new exposure, we will again charge.
You need to look at the -30% row in the stress test, if there is an exposure you will need to pay based on that exposure.
If for example you have 100000 on the account and your PNL at -30% is -150000, your exposure will be -50000
A stress test is a very simple calculation, it checks the extreme market situations and basically looks at the unlikely event. However, this unlikely event has a very large financial impact, to the point of putting a customer into the situation were you owe us as Broker money.
We do not want to increase the margin because it is an unlikely event, however, we want to make clients aware of that possibility and charging a fee is a way of doing it.
At this link on our website you can see further info on the Exposure Fee: LINK../index.php
Kind regards,
xxxxx
IB Customer Service
After stuff expired Friday, closing some short options, making a deposit, and stopping writing options I should not have had any excess exposure.
However, 2 things caused me still to have exposure ...
1) the OCC prices of SPX options that expired yesterday were not 0, but some positive numbers, thereby artificially reducing my account balance.
2) OCC prices or IBKR statement prices of stuff like SPX 1250P that are not even within 30% are causing hundreds of thousands of dollars of exposure, when the previous day they were only causing a few thousand dollars of exposure.
This is all BS.
I am thinking of stopping trading here or finding or focusing on my other strategies.
However, 2 things caused me still to have exposure ...
1) the OCC prices of SPX options that expired yesterday were not 0, but some positive numbers, thereby artificially reducing my account balance.
2) OCC prices or IBKR statement prices of stuff like SPX 1250P that are not even within 30% are causing hundreds of thousands of dollars of exposure, when the previous day they were only causing a few thousand dollars of exposure.
This is all BS.
I am thinking of stopping trading here or finding or focusing on my other strategies.
that will be the DAILY fee (assuming risk stays the same)? ouch
amazing.....we will charge a fee to make clients "aware"...... not because we want more revenue..... Its all altruistically for YOUR BENEFIT not ours
Just so you know, just because IB has not settled weekly options from Friday yet, does not mean the OCC prices were not zero. The OCC has settled these option already, IB maybe has not.