This is based on my research on IBâs liquidations practice, and after speaking to people that have first hand knowledge. I think Def will agree with the 9:40 time. As for the reason why itâs done at 9:40, since IB doesnât comment here about the process of liquidation etc. we can all speculate about the reasoning.
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IB Margin Changes
- Thread starter gtcharlie
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This is based on my research on IBâs liquidations practice, and after speaking to people that have first hand knowledge. I think Def will agree with the 9:40 time. As for the reason why itâs done at 9:40, since IB doesnât comment here about the process of liquidation etc. we can all speculate about the reasoning.
Quote from newwurldmn:
9:40 seems to be generous to me on IB's part. There's no worse time to put a margin call order than at 9:30. Especially in options. So if IB were trying to fuk you on a auto liquidation, they could take a lot more money out of you if they did it at 9:30 .
I agree, 9:40 is more generous then 9:30.
Quote from newwurldmn:
9:40 seems to be generous to me on IB's part. There's no worse time to put a margin call order than at 9:30. Especially in options. So if IB were trying to fuk you on a auto liquidation, they could take a lot more money out of you if they did it at 9:30 .
Newurldmn, let's wait for IB to confirm that they wait until 9:40 to start auto liquidation as stated by rtg in this thread.
There's apparently lots of confusion out there on the auto liquidation policy. On 5/7/10, the day after the flash crash, an apparent IB employee in programming proclaimed,
Quote from ids:
We never auto-liquidate instantaneously. You always have 10 minutes to deal with a problem.
Many vigorously challenged this statement although I do not know whether it was ever retracted by IB within the ET forums.
Quote from Options12:
Newurldmn, let's wait for IB to confirm that they wait until 9:40 to start auto liquidation as stated by rtg in this thread.
There's apparently lots of confusion out there on the auto liquidation policy. On 5/7/10, the day after the flash crash, an apparent IB employee in programming proclaimed,
Many vigorously challenged this statement although I do not know whether it was ever retracted by IB within the ET forums.
IB has at least 3 people continuously monitoring Elite Traders , or IBâs affiliation with TH these people reply by writing a couple of posts with some disingenuous âhalf truthsâ and then when questioned about that, these people are no more to be found. This has happend time and time again. See some examples below ;
http://www.elitetrader.com/vb/showthread.php?threadid=210359
http://www.elitetrader.com/vb/showthread.php?s=&threadid=222191
http://www.elitetrader.com/vb/showthread.php?s=&threadid=198220
http://www.elitetrader.com/vb/showthread.php?s=&threadid=131741
http://www.elitetrader.com/vb/showthread.php?s=&threadid=136539
http://www.elitetrader.com/vb/showthread.php?s=&threadid=141896
http://www.elitetrader.com/vb/showthread.php?s=&threadid=118302
http://www.elitetrader.com/vb/showthread.php?s=&threadid=118256
The quote
"We never auto-liquidate instantaneously. You always have 10 minutes to deal with a problem". Is making it sound that there is always 10 minutes before IB will liquidate, thatâs false. What is true however that you have 10 minutes in the morning between 9:30 till 9:40.
Quote from newwurldmn:
So if IB were trying to fuk you on a auto liquidation, they could take a lot more money out of you if they did it at 9:30 .
But they could probably take a lot less if they gave it five more minutes since that's when the circuit breakers go on and market makers are told to tighten spreads.
Quote from Options12:
But they could probably take a lot less if they gave it five more minutes since that's when the circuit breakers go on and market makers are told to tighten spreads.
Perhaps. I don't remember how it works for options anymore. When I was a market maker we were required to make tight markets after 2 minutes. But the reality is that 10 minutes should be enough time to get you out of the crazy stock prints.
Anyway, if you guys are so against Interactive brokers join another firm. There are lots of good ones out there. If you need what the extra products that IB offers, realize there's a reason they are offering it and everyone else isn't.
Quote from newwurldmn:
But the reality is that 10 minutes should be enough time to get you out of the crazy stock prints.
newwurldmn, new rules came into effect in 2010 that say
"For securities subject to the circuit breaker pilot program approved this past summer, market makers must enter quotes that are not more than 8% away from the NBBO.
For the periods near the opening and closing where the circuit breakers are not applicable, that is before 9:45 a.m. and after 3:35 p.m., market makers in these securities must enter quotes no further than 20% away from the NBBO."
http://www.sec.gov/news/press/2010/2010-216.htm
I think IB would extend the 10 minute auto liquidation grace period to 9:45 once this rule printed.
Quote from Options12:
newwurldmn, new rules came into effect in 2010 that say
"For securities subject to the circuit breaker pilot program approved this past summer, market makers must enter quotes that are not more than 8% away from the NBBO.
For the periods near the opening and closing where the circuit breakers are not applicable, that is before 9:45 a.m. and after 3:35 p.m., market makers in these securities must enter quotes no further than 20% away from the NBBO."
http://www.sec.gov/news/press/2010/2010-216.htm
I think IB would extend the 10 minute auto liquidation grace period to 9:45 once this rule printed.
I left market making many years before that rule. But it makes sense that 15 minutes makes more sense than 10 minutes.
I still think that rather than trying to have IB admit that they are unfair, you should look for different brokers. Apparently a lot of people like their policies and you have lots of choices out there. You are trying to beat a dead horse and it's unclear what you are trying to achieve.
Quote from newwurldmn:
I still think . . . . you should look for different brokers.
I appreciate your advice and would understand if you ignore this thread.
IB will benefit from a review of their methodologies and will be a stronger broker in the future for you and everyone else who keeps money with them.
Quote from Options12:
I appreciate your advice and would understand if you ignore this thread.
IB will benefit from a review of their methodologies and will be a stronger broker in the future for you and everyone else who keeps money with them.
Fair enough. I will go. You two will be talking amongst yourselves.
I don't use IB because I don't like their liquidation policies and more importantly I didn't like the reviews I read about their customer service.
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