IB Forex question

D

Digs

At 2.24 GMT from IB web trader

I read that IB Forex might be great on spreads and commissions but they make a killing on converting your base USD funds to the underlying to make a trade and/or withdraw funds.

BID/ASK
EURUSD on IDEAL PRO 1.4074/1.4075, Spread 1 pip
EURUSD on IDEAL 1.4068/1.4079, Spread 11 pips


I trade IDEAL PRO, therefore I BUY/SELL the underlying of EUR

So I BUY $71,000 EUR to get $100,000 EURUSD. 1 lot.

To trade I enter into IB TWS $71,000 EUR to BUY EURUSD.(I think)

My account is in USD base.

Am I paying 11 pip spread in any situation with IB, either to convert my monies to trade, or convert my monies when I want funds withdrawn from the account, or in any situation ???

I thought IB made monies from commissions on Forex only, not on any conversions...
 
If you convert at ideal pro quantities (ie don't convert your winnings back ever couple of grand) then your conversions should be at the pro rate.

If you convert smaller than minimum trade amounts I would guess you'll pay the higher spread.
 
Things not do then in IB Forex

1) Dont take monies out less than $25k: So to get monies out, nothing less than $25000 otherwise you would suffer the shocking 11 pip spread.

2) No margin calls: If you suffer a margin call, IB get you out at the IDEAL rate no matter the deal size.

anything else
 
I have learnt more.

If I have $100,000 USD in my account and I trade EURUSD and GBPUSD, but as profits are kept in the base currency traded I have to convert them back to USD as this is the base currency of my account.

Profits like
EURUSD $10,000 EUR
GBPUSD $15,000 GBP

For me to convert these back to USD I have to pay the massive spreads paid by IDEAL ( so 10 pips for EURUSD) as they are less than $25,000.

Is this correct ???
 
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