Interactive Brokers and Leverage

T

tonyf

I have been using a delta-neutral strategy for a while . It has been extremely consistent but not very profitable. My net returns are around 4% p.a.

I am now quite confident borrowing to improve the economics, but care to understand the terms in full prior to doing so. I asked the IB helpdesk for detailed terms, etc....they have not shared much. I do not want to be caught off guard with a margin call.

Any experience or advice regarding this matter?
 
yes, haha, and did I tell you about my new fund raising round, totally legit.
 
tonyf said:
I have been using a delta-neutral strategy for a while . It has been extremely consistent but not very profitable. My net returns are around 4% p.a.

I am now quite confident borrowing to improve the economics, but care to understand the terms in full prior to doing so. I asked the IB helpdesk for detailed terms, etc....they have not shared much. I do not want to be caught off guard with a margin call.

Any experience or advice regarding this matter?
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What are the questions you are asking? Different things have different margin requirements.
 
tonyf said:
What happens if a share drops 5 per cent overnight. Do they auto liquidate?
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IB auto liquidates as far as I know, so I think the answer is yes. But only if you violate margin, so... if you are saying you can't lose at all, then you have a problem.
 
nooby_mcnoob said:
IB auto liquidates as far as I know, so I think the answer is yes. But only if you violate margin, so... if you are saying you can't lose at all, then you have a problem.
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No one can not loose at all. Have not been exposed to seriois macro shocks yet?

What is the best way to risk manage a mrgin. Does IB provide any tools?
 
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