Good luch on your search.
IB Margin Changes
- Thread starter gtcharlie
- Start date
- Status
Good luch on your search.
This is a good life lesson, one I've learned many times -- people are never grateful. Rather than thanking IB for letting them trade junk stocks on margin all these years, they're outraged IB is discontinuing this courtesy.
The problem with your statement is that IB threw a blanket over everything with a market cap of less than 250 million. Preferreds, closed end funds, stocks with little volatility. To me that is a lot like some of the decisions the SEC makes and we all know how wise some of those have turned out to be. And how beneficial for investors.
lol @ junk stocks. Every company in the world with a market cap less than $250 million is junk?
They made some changes to the policy but not enough to help me. It's good they eliminated prefs, closed end funds, and etfs. Email below:
As a follow-up to a communication issued last Friday, please note that we will be implementing a change to our margin policy whereby stocks which report a market capitalization below USD 250 million, or equivalent, will no longer be considered marginable and therefore will have no loan value. This change is intended to recognize the well-known risks of micro and small cap stock which, relative to larger cap stocks, tend to be more volatile and less liquid, particularly in periods of elevated volatility. At this point, the policy will exclude certain classes of securities such as preferred stocks, ETFs and closed end funds, although individual issues within those classes may already be subject to house margin requirements for other cause and those margin rates will not change.
The table below includes a list of securities which you hold that will be subject to this change. Please note, that in an effort to provide sufficient time for you to take the actions necessary to ensure margin compliance, we have extended the time line for implementation of these margin changes as follows:
Close of Business
Effective Date Margin Rate
2011/09/21 35%
2011/09/23 50%
2011/09/28 75%
2011/09/30 100%
As a follow-up to a communication issued last Friday, please note that we will be implementing a change to our margin policy whereby stocks which report a market capitalization below USD 250 million, or equivalent, will no longer be considered marginable and therefore will have no loan value. This change is intended to recognize the well-known risks of micro and small cap stock which, relative to larger cap stocks, tend to be more volatile and less liquid, particularly in periods of elevated volatility. At this point, the policy will exclude certain classes of securities such as preferred stocks, ETFs and closed end funds, although individual issues within those classes may already be subject to house margin requirements for other cause and those margin rates will not change.
The table below includes a list of securities which you hold that will be subject to this change. Please note, that in an effort to provide sufficient time for you to take the actions necessary to ensure margin compliance, we have extended the time line for implementation of these margin changes as follows:
Close of Business
Effective Date Margin Rate
2011/09/21 35%
2011/09/23 50%
2011/09/28 75%
2011/09/30 100%
Almost like they listened to what I have been saying all along. Certain stocks should definitely have been excluded from the list and although I still disagree with eliminating all margin for small cap stocks this might enable me to stay with IB awhile longer. Not comfortable with that type of policy implementation so perhaps moving now before the next bombshell hits may be a good idea.
Yah, I already decided I was going to move even if they backed away from this policy entirely. I can't risk that they implement something else in the future on a whim. It does seem like the either read this thread or listened to customer feedback, to a point.
- Status