IB Fined by CFTC

[AbbotAle]

I like IB, got no complaints but who knows what goes on with these broker/dealers behind the scenes?

Here's what I've done to offer some pretty good protection against a serious problem with them (unlikely in my opinion but you never know these days).

If there were to be a problem you can guarantee with 100% certainty that the news will get out to the select few, ie not you and me.

Therefore the stock will start to slide on NO news, probably slowly for 2-3 days then accelerate. If/when the price dips below $10 AFTER a heavy move that's your queue that probabilities state something is wrong, so take evasive action and pull your money out (or at least a large %)

Summary: Set a price alarm for < $10 and sleep well at night.

 

[oldtime]

Quote from AbbotAle:

I like IB, got no complaints but who knows what goes on with these broker/dealers behind the scenes?

Here's what I've done to offer some pretty good protection against a serious problem with them (unlikely in my opinion but you never know these days).

If there were to be a problem you can guarantee with 100% certainty that the news will get out to the select few, ie not you and me.

Therefore the stock will start to slide on NO news, probably slowly for 2-3 days then accelerate. If/when the price dips below $10 AFTER a heavy move that's your queue that probabilities state something is wrong, so take evasive action and pull your money out (or at least a large %)

Summary: Set a price alarm for < $10 and sleep well at night.

that's why, in the old days, banks and insurance companies traded OTC. They didn't want their stock price confused with the health of the company.

So your idea is to keep your money based on how stock speculators bet.

Why don't you just put it all in the S&P 500? That's what they are buying today.

don't that beat all? I have some money over there at Chase. If the stock price drops should I switch it to BAC?

Won't I be doing an awful lot of switching?

If Charles Schwab goes up today, does that mean the company is healthier?

 

[FrankSlaughtery]

another way to 100% prevent a total wipeout is to use multiple (3-4) brokers w/ DIFFERENT clearing firms. IMHO IB is the best broker for safety even after this latest incident but still you never know. if you had asked me if one of the highest volume futures traders (MF) would go to wallpaper i prob wouldn't have believed you.

 

[AbbotAle]

Quote from oldtime:


So your idea is to keep your money based on how stock speculators bet.

No, but it's as good as any strategy to work out if your broker is in financial trouble.

Would have worked a dream with MF Global as the problems first showed up in the stock price...

 

[AbbotAle]

Quote from oldtime:


Why don't you just put it all in the S&P 500? That's what they are buying today.

Because that's an investment in the S&P 500 that's why.

IB is a broker, I want to use their brokerage services, that's why I have an account with them. I don't think this is too hard to understand.

 

[AbbotAle]

Quote from oldtime:

I have some money over there at Chase. If the stock price drops should I switch it to BAC?

Won't I be doing an awful lot of switching?

No, because it's not about the stock 'droping' per se. The banks also aren't tiny brokerages such as IB and MF which can be thrown to the wolves.

You might think different but if IB goes to new lows, under $10 very quickly on NO news, then I don't want to find out there was a problem later. You can take the risk if you want and you'll probably win, but then winning means you'll actually win nothing but lose and it's not going to be nice. A pretty crappy bet if ever there was one - win nothing, lose everything

 

[AbbotAle]

Quote from oldtime:


If Charles Schwab goes up today, does that mean the company is healthier?

No, it's not about good 'health' and it's never going to be. I don't think you're getting any of this...

It's about POTENTIAL RISK, and there's a lot around at present with financial instutitons (key word: potential, and potential doesn't mean it's going to happen).

 

[tickmagnet]

Regulators accuse Success Trade Securities owner of scamming NFL, NBA players.
haha , just2trade , I used to trade with them.

 

[oldtime]

call Lloyds of London and ask if them if they will insure your ib account

you might need to get about 10 of your friends together to make it worth their while

just a guess, the chances of you losing all your money trading vs ib going broke is probably 100 to 1.

 

[AbbotAle]

Quote from oldtime:


just a guess, the chances of you losing all your money trading vs ib going broke is probably 100 to 1. [/B]

It didn't take long did it, the old message board put down -

I'm better than you
I make more money than you
I'm richer and more succesful than you

And on and on it drones.

I still can't see why you're attacking my simple strategy, that being -

If your broker's stock price moves quickly and aggressivly to new all-time lows on NO news - something might be wrong so common sense says take evasive action.

This advice seems pretty prudent to me and simple to execute, yet you suggest that's it stupid and a waste of time...