IB trashes account - what would TOS do?

However, on Friday, (I am in Australia), the last time I could check my account was 2 hours before Friday's market opens. When I next check the account about 3pm Friday (New York time), IB have fire-sold all the gold stocks and gold stock options because of another assignment.
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What's lacking from your story is your margin situation at the time of IB's action after that "other" assignment.

Disregarding, for the moment all the circumstances which got me into this position in the first place, which I take responsibility for, I still find IB's action draconian, unnecessary and to put it mildly, a big f-you from IB. Even their warning emails about the liquidation threat (unlike any other IB emails) are going straight into the Junk Email bin of Windows Mail because they are so roughly formatted.
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If you received liquidation notification from IB due to insufficient margin and you did nothing, how is this their fault?

If you had sufficient margin to cover your positions then you may have a legitimate complain against. If not, no broker will let you coast fly by a margin call w/o dealing with it.
 
I have a friend who switched from IB to TOS just for this reason (i.e. what happened to the OP)

IB does state they'll liquidate stuff immediately to meet margin in the event of assignment. TOS will apparently call you and give you a half a day to straighten things out yourself before taking action.

A call to TOS customer support would answer this quickly.
 
I agree with the last poster. TOS calls or emails you to let you know you've been assigned and you need to put up money or straighten things out. If its part of a vertical, its really no big deal. This stuff happends all the time with them.
 
Quote from lejmorro:

To cut a long story short, IB trashed my account on Friday and I'm asking what TOS would do...
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I've been arguing with IB (theoretical only) fearing such a problem.

You have a 'liquidate last' option available on the 'account page' If you had checked everything except for those puts you owned, they would have sold those puts (sadly under parity) or the position resulting from the assignment. That would have left everything else untouched.

All I can tell you is that you should have paid the max to close those put spreads, instead of allowing them to sit in your account.

Thus, there were steps you could have taken.

I agree they are draconian and don't seem to care. There are no humans to make decisions - they set a computer to close one position. If it does not satisfy margin, they do it again and again. It's a shame.

The very best way to get the answer you want is to call TOS directly and ask to speak with someone in the margin department. It's probably best to call when the markets are closed.

I have great empathy for your situation.

Mark
 
Quote from forex-forex:

"You sleep in the bed you make."
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That is a childish reply.

This guy is looking for help. If you don't have any help to offer, they why butt in?

Yes, I already know your answer.

Mark
 
What if the position(s) went further against you during the day? Then IB has to play bill collector.....

was asked by forex_forex.

I dont understand this. 10 x 110 SPY puts were assigned against me and I didnt get to market in time (IB gave me 10 minutes) to exercise the 10 x 108 puts to cover.

How is it going against me further. As I said, the Option Clearing House gives all day to cover the assignment as far as I know. If IB have the authority to sell 20 long separate stock positions and several long call positions and to close a few SPY vertical spreads, why havnt they got the authority to exercise the necessary cover which is available.

Anyway, I'm accepting the losses incurred by the IB action (about $5000 or 20% of my account over and above what was going to be lost anyway) but will trade very little further with IB.

As I said earlier, what's the point of comparing commissions (say between IB and TOS) when this stuff can happen. I'm going to do what Dagny advises and ask TOS directly what their policy is.

Thanks for all your replies.
 
I appreciate the fact that IB auto-liquidates. It makes me sleep well at night knowing that the safety of my account will not be affected by the actions of others.
 
Quote from stevegee58:

I have a friend who switched from IB to TOS just for this reason (i.e. what happened to the OP)

IB does state they'll liquidate stuff immediately to meet margin in the event of assignment. TOS will apparently call you and give you a half a day to straighten things out yourself before taking action.

A call to TOS customer support would answer this quickly.
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I've had a TOS account for about 6 months now. I've been assigned multiple times. Every time I received an email before market open. Additionally, since I was in a vertical spread their software was intelligent enough not to liquidate my positions even though I was assigned stock who's margin that exceeded my account value.

Open an account at TOS you'll be happy that you did. You wont get the best commission prices, but you'll probably end up being happy enough that it wont matter.
 
Quote from forex-forex:
"You sleep in the bed you make."
More...
Quote from dagnyt:
That is a childish reply.

This guy is looking for help. If you don't have any help to offer, they why butt in?

Yes, I already know your answer.

Mark
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He has been an ET member since Dec 2007 and it has been covered many times on Elite Trader that IB is very indiscriminate when it comes to closing clients positions. If he can't get to his computer or IB's liquidation emails end up in his junk folder that's not IB's problem, it's HIS problem.

This is Elite Trader forums, not Elite Baby forums.
 
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