I wonder if this means that if one clears the minimum amount hurdle and sets FXCONV then he can use IDEALPRO to do conversions. Anyone tried this yet?
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IB TWS "Virtual FX Position" problem
- Thread starter travis
- Start date
I wonder if this means that if one clears the minimum amount hurdle and sets FXCONV then he can use IDEALPRO to do conversions. Anyone tried this yet?
First, I believe IDEAL is gone for good. Even the smallest transactions are cleared in IDEALPRO now. The downside is some small positions can be never cleareed. For example, if the account is in USD and you have remeinder in yen you will have to buy USD/JPY ansted of selling JPY/USD and are unlikely to match the JPY size exactly.Quote from orange_trad:
I wonder if this means that if one clears the minimum amount hurdle and sets FXCONV then he can use IDEALPRO to do conversions. Anyone tried this yet?
The other thing is "Virtual FX positions" are called "Virtual" for a reason. It's the account balance in various currencies that tells teh story of teh foreign exchange risk. FX positions in TWS are purely for convenience.
You can always right-click an FX position in TWS, select "Adjust Position Size or Average Price" and change both for your convenience.
Finally, if you never ever trade FX for profit, you can hide FX positions totally....
Quote from travis:
Hello moarla, thanks for participating.
Since you're the expert at this, can you please tell me what the attached picture looks like? My friend says everything is right, because "Market Value - Real FX Balance" says he has 5000 GBP. I say that he should worry instead because, by the FX Portfolio, it looks like he's short (or long) 48000 GBP and he has an ongoing loss of 3000 GBP from that position.
He considers it something like a mirage or an optical illusion (or a "bug"). I think he has a big forex position open and he's lucky it didn't cause him more damage.
What is your opinion? Real problem or optical illusion? And if we do your trick what could be the consequences? And how do we know that it worked? Thanks.
What I've seen is, people are the calmest right before a MC. From the picture it is obvious that your friend has a GBP.USD short position of 48024 (sold 48024 GBP for 74884.06 USD) and that short would result a loss of 2976.52 USD at the time of the picture taken. Before this transaction he had a +53609.17 GBP and -59234.18 USD balance. (By the way it is obvious from the picture that the base currency is USD, since the total is given in USD). It's not an optical illusion, he is racking in losses with both hands.
Quote from LeeD:
First, I believe IDEAL is gone for good. Even the smallest transactions are cleared in IDEALPRO now. The downside is some small positions can be never cleareed. For example, if the account is in USD and you have remeinder in yen you will have to buy USD/JPY ansted of selling JPY/USD and are unlikely to match the JPY size exactly.
The other thing is "Virtual FX positions" are called "Virtual" for a reason. It's the account balance in various currencies that tells teh story of teh foreign exchange risk. FX positions in TWS are purely for convenience.
You can always right-click an FX position in TWS, select "Adjust Position Size or Average Price" and change both for your convenience.
Finally, if you never ever trade FX for profit, you can hide FX positions totally....
Right. If I wasn't clear: "I wonder if this means that if one clears the minimum amount hurdle and sets FXCONV then he can use IDEALPRO to do conversions, as in: convert 'Real FX Position' (non-base) currency balance that is over 25000 USD back into the base currency." Emphasis on conversion not opening positions for speculative purposes. And the question was: "Has anyone tried this yet?"
However I didn't notice that IDEAL was gone since I never bothered with it. Thanx for pointing it out. Even though I wasn't concerned about it at all.
And of course you can hide FX positions, but it's just that: hiding. If you trade anything in foreign currency, then you're exposed to FX fluctuations while in the trade. IB won't swallow it for you out of the goodness of their hearts.
Quote from brocklanders:
travis - what version of TWS is that from? is your base currency USD or GBP? I would be somewhat concerned with that if your base is in USD because that FX position is almost 3x more than your total cash in USD.
The version got updated today, and thus the picture reflects the latest version, build 911.3.
That's not my account - it's my friend's account, as I said. I don't know if the base currency is USD or GBP. However, I did tell him: hey, this is not something normal. You must at least tell me this thing is a bug. You can't pretend it's an optical illusion. It says "unrealized P & L -3000": that's not something totally normal.
Quote from moarla:
i just saw it, its USD.
well n ot shure what that position is , but since its a "virtual FX position" change the position value to 0.
this must come from an operation in GBP made bevore...
Yes, you're right, it is USD, because it lists the total in USD.
I will try to get him to use your method, because it can't hurt, whereas, if he leaves it like this, he can only risk unexpected results.
Quote from orange_trad:
What I've seen is, people are the calmest right before a MC. From the picture it is obvious that your friend has a GBP.USD short position of 48024 (sold 48024 GBP for 74884.06 USD) and that short would result a loss of 2976.52 USD at the time of the picture taken. Before this transaction he had a +53609.17 GBP and -59234.18 USD balance. (By the way it is obvious from the picture that the base currency is USD, since the total is given in USD). It's not an optical illusion, he is racking in losses with both hands.
Thanks. This is close to rocket science to me. He's very good at math and all that, so it proves I am not stupid, at least not for the fact that I can't figure this thing out. Many intelligent people have been debating this subject for years.
Your post is pretty clear. I will show it to him and it will hopefully convince him to do something about this.
It's not rocket science - your friend is long GBP5,585. The "virtual fx" position has nothing to do with ownership of any assets.
At some point in time, your friend deposited a large amount of GBP into the account or made a large profit on a GBP denominated security and transferred it into USD. This created the "virtual fx" position. The "virtual fx" position tracks currency trades. Examples: I deposit CAD into my USD base currency account and convert into USD - voila virtual CAD.USD short position created. In the same USD base currency account I go long an AUD security funded by a margin loan, make a profit, and covert the profit into USD - voila virtual AUD.USD short position created. In both examples at the end I only have a long USD position.
Another way to think of it is that if you trade a non base currency security the "Market Value" section tracks the p&l in the security's currency while the "FX Portfolio" section tracks the p&l on account of exchange rate fluctuations. Then when the position is resolved there is a residual "virtual fx" position left over which needs to be zeroed manually.
At some point in time, your friend deposited a large amount of GBP into the account or made a large profit on a GBP denominated security and transferred it into USD. This created the "virtual fx" position. The "virtual fx" position tracks currency trades. Examples: I deposit CAD into my USD base currency account and convert into USD - voila virtual CAD.USD short position created. In the same USD base currency account I go long an AUD security funded by a margin loan, make a profit, and covert the profit into USD - voila virtual AUD.USD short position created. In both examples at the end I only have a long USD position.
Another way to think of it is that if you trade a non base currency security the "Market Value" section tracks the p&l in the security's currency while the "FX Portfolio" section tracks the p&l on account of exchange rate fluctuations. Then when the position is resolved there is a residual "virtual fx" position left over which needs to be zeroed manually.
Like my friend, you're saying that the "virtual fx position" is just appearance and virtual. I see your point. When I told him to look at this thread and to how others were saying there was something wrong with his FX position, he replied he won't worry about it, because it's virtual and... everything you said. He also said that he spoke to IB which told him not to worry about it. I guess this puts an end to my worries.
The fact that you can manually set it to zero - without making any trades - means it is just an accounting thing and not a forex position. However, we must add that IB TWS, with the naming of its menus, the pop up messages warning about various things, in this case has made the issue very equivocal and confusing.
The fact that you can manually set it to zero - without making any trades - means it is just an accounting thing and not a forex position. However, we must add that IB TWS, with the naming of its menus, the pop up messages warning about various things, in this case has made the issue very equivocal and confusing.
Quote from lpope:
It's not rocket science - your friend is long GBP5,585. The "virtual fx" position has nothing to do with ownership of any assets.
At some point in time, your friend deposited a large amount of GBP into the account or made a large profit on a GBP denominated security and transferred it into USD. This created the "virtual fx" position. The "virtual fx" position tracks currency trades. Examples: I deposit CAD into my USD base currency account and convert into USD - voila virtual CAD.USD short position created. In the same USD base currency account I go long an AUD security funded by a margin loan, make a profit, and covert the profit into USD - voila virtual AUD.USD short position created. In both examples at the end I only have a long USD position.
Another way to think of it is that if you trade a non base currency security the "Market Value" section tracks the p&l in the security's currency while the "FX Portfolio" section tracks the p&l on account of exchange rate fluctuations. Then when the position is resolved there is a residual "virtual fx" position left over which needs to be zeroed manually.
that is exactly what i think. set it at zero.
As i said before with the last version this problem should not exist anymnore. /(read on realease notes)