IB Margin Changes

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Quote from given2invest:

I think this is a game changer. If they don't reverse the rule, I will be transferring my account to a prime broker. I have a material account with them and can't operate without margin.

I'm not sure we will see big moves in stocks as a result of this, however. I could be wrong but I'd think this only effects a small minority of their customer base.

It's a terrible business decision. They are assuming a $150 million market cap is inherently risky (or more risky) due to it's size. This is simply wrong.

I don't have a name of a retail brokerage firm that is anywhere nearly as good as IB but if your account is large enough there are many small prime brokers that would take you. If you are not big enough you might be shit out of luck.

The whole situation is awful. I just registered to post here.
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For those with accounts less then $5mil, you won't be able to move to a prime broker. And, you won't get any more leverage then what is available at IB.
 
Quote from mastacoli71:

For those with accounts less then $5mil, you won't be able to move to a prime broker. And, you won't get any more leverage then what is available at IB.
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I can offer segregated Customer Portfolio Margin at Penson and ML Pro with much less than $5mm. Currently both prime brokers over PM on equities with market caps under $250MM. There has been no change.

Bob
rmorse@victorsecurities.com
 
Quote from rmorse:

I can offer segregated Customer Portfolio Margin at Penson and ML Pro with much less than $5mm. Currently both prime brokers over PM on equities with market caps under $250MM. There has been no change.

Bob
rmorse@victorsecurities.com
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Dude, are you that desperate for business? Take your ambulance chasing to another thread. LOL though as the firm you're touting for clearing services has a market cap < $51 million.
 
Quote from rmorse:

I can offer segregated Customer Portfolio Margin at Penson and ML Pro with much less than $5mm. Currently both prime brokers over PM on equities with market caps under $250MM. There has been no change.

Bob
rmorse@victorsecurities.com
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Will it be insured by SPIC up to 500k? if yes I think it might be great alternative.
 
Yes. If you're NOT a Broker Dealer, you're protected by SIPC up to the SIPC limits. Plus, Penson like most brokerage firms has excess SIPC coverage from an insurance firm to offer a little more coverage.

Terms of SIPC help. Customers of a failed brokerage firm get back all securities (such as stocks and bonds) that already are registered in their name or are in the process of being registered. After this first step, the firm's remaining customer assets are then divided on a pro rata basis with funds shared in proportion to the size of claims. If sufficient funds are not available in the firm's customer accounts to satisfy claims within these limits, the reserve funds of SIPC are used to supplement the distribution, up to a ceiling of $500,000 per customer, including a maximum of $250,000 for cash claims. Additional funds may be available to satisfy the remainder of customer claims after the cost of liquidating the brokerage firm is taken into account.
 
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