IB Margin Bond purchase/coupon

S

Soon2Bgreat

IB says you need to maintain 3% of face to purchase and keep a long bond position. Is this correct?

If i am long a bond position on margin...do i keep the entire coupon payment or only the 3% of it?

I know these are quite simple and basic questions, but the help would be appreciated.

Thanks,
 
Quote from Soon2Bgreat:

IB says you need to maintain 3% of face to purchase and keep a long bond position. Is this correct?

If i am long a bond position on margin...do i keep the entire coupon payment or only the 3% of it?

I know these are quite simple and basic questions, but the help would be appreciated.

Thanks,
More...

3% * T-bill market value.
10% * bond market value(investment grade)

http://individuals.interactivebrokers.com/en/trading/marginRequirements/margin.php?ib_entity=llc


btw-long pretty much any bond on margin make no sense..you will receive full coupon payment
 
Quote from Bob111:



btw-long pretty much any bond on margin make no sense..you will receive full coupon payment [/B]
More...

Why does it not make sense?

Thanks for the help.
 
Quote from Bob111:

http://individuals.interactivebrokers.com/en/accounts/fees/interest.php?ib_entity=llc
More...

USD 100,000 5.72% (BM + 1.5%) 5.22% (BM + 1%) 1,000,000 4.72% (BM + 0.5%) 3,000,000 4.47% (BM + 0.25%

Are you trying to say that i will be charged this interest?

If so, is the answer not simply purchase a bond that pays a higher coupon than your margin interest rate or get a lower interest rate by funding in a cheaper currency?

I appreciate your input...thank you.
 
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