IB margin increase

[Bob111]

the bottom line is simple-IB can set whatever the margin they want on any stock\security. and they do so. with or without such list.
i remember how i got royally screwed in 2008,when they raised their margin rates to 100% on ALL corporate bonds,regardless to their rating quality or liquidity. and keeping them for year or so. even when their own website was saying-30% on anything with BBB and above.

after quick check i find that my BP is disappearing quickly simply because i trade stock that have 100% margin rate at Ib. not "default" rate. interesting is that after i open the ticket and ask question about it-they just throw their formula at me,without pointing out that some stocks can and do have 100% margin rate.

 

[takestock]

Yes the last one I received was on Nov 2nd last year. The link was for node/1988 if you want to look up the last set of symbols.

I think you only receive the email if one or more of your open positions is in that list. I usually have dozens of open small cap positions so I probably receive the email each time.

 

[dhpar]

Quote from takestock:

Yes the last one I received was on Nov 2nd last year. The link was for node/1988 if you want to look up the last set of symbols.

I think you only receive the email if one or more of your open positions is in that list. I usually have dozens of open small cap positions so I probably receive the email each time.

i also believe this is the case...

 

[Zr1Trader]

Well Russell small cap index is at/near highs. A good downside slide would hurt pretty bad if people are initiating/using more margin at these levels.

They just managing risk to benefit customer and themself? Or are there other motives detrimental to customer?



Can anyone tell me if in 08 their Reg T margin remained at 50% for big names/"safer" stocks/bonds? Did that go to 100% also or just Portfolio Margin.

I was looking at throwing 100k in their "safe stuff" then using 50k as part of a rental property investment. Could cover a margin call if I had too but would be nice to know the chances of getting a call during another 08 type crisis.

 

[braincell]

Quote from takestock:


I think you only receive the email if one or more of your open positions is in that list.

I checked manually all my positions and didn't find any of the stocks in that list. The small caps I have a position in are Municipal Bond Funds. Should those even be in there? It's vague, I have no idea what to think or how to verify.

 

[Bob111]

Quote from braincell:

I checked manually all my positions and didn't find any of the stocks in that list. The small caps I have a position in are Municipal Bond Funds. Should those even be in there? It's vague, I have no idea what to think or how to verify.

checking is simple-go to products,click on ticker

http://www1.interactivebrokers.ch/contract_info/v3.8/index.php?action=Details&site=GEN&conid=265595

AAON

margin requirements-default. on some stocks that are not on list it will be 100% but back to my example of 2007-IB can easily go against their own rules. back then it was 30% for corp bonds on website and 100% in real trading

 

[masterjaz_99]

Quote from braincell:

I checked manually all my positions and didn't find any of the stocks in that list. The small caps I have a position in are Municipal Bond Funds. Should those even be in there? It's vague, I have no idea what to think or how to verify.

braincell,
I too found securities I own with less than 250M cap that were not on the list. I contacted support and confirmed that only those on the list are subject to the margin change.

**But the representative stated multiple times that "margin increases can occur at any time"**

As a long(ish) term holder that does not have their platform open at all times, I am troubled by this. The current solution as you noted is to manually check the margin on owned securities often.

Cheers

 

[takestock]

Another useful way to see your margin usage is to go to the Account Mgmt web site for IB, login, go to Reports->Supplemental->Margin Reports. It will show you how much margin you current positions are using. There are many other small cap stocks already at 100% margin rqmt. I assume they mean by "only those on the list are subject to the margin *change*" that no other stocks will be added to the 100% list at this time, but this list is an addendum to the existing set of non-marginable low cap stocks.

 

[Specterx]

Quote from MoreLeverage:

I agree - did they get burned in small cap names? If not, why are they doing this when it will cause customers to trade less and earn low ROCs, presumably going elsewhere if necessary.

Considering that your typical retail trader account is unprofitable (and IB is no exception to this), it's probably more accurate to say they're doing their customers a favor.

The Russell is actually at new all-time highs - so small caps have been heavily bid up in this rally. I imagine IB wants to make sure there are enough fire exits around if and when there's a stampede.

 

[chictrader]

Time to move to a firm that clears Wedbush if you want the best shorts without the increased margin.