Interactive brokers raising vix margin

[truetype]

IBKR now charges absurd margins on VIX calendar spreads. According to CBOE the margins for tier 1 spreads (M1, M2) are $2200/$2000 and for tier 2 spreads ( M2, M3) $770/$700. In comparison IB charges $4860/$3888 for (M1,M2) and $10086/$8069 for (M2, M3). This makes no sense and definitely means I need to look for another broker...after 10 years

Or trade one of the other 10,000 financial products available on IB...

 

[Sig]

Or trade one of the other 10,000 financial products available on IB...

What is it with these asinine comments when it comes to IB? Should a broker's customers really be expected to switch instruments because the broker does something ridiculous without explanation? Especially when VIX is a rather unique product and strategies developed for it wouldn't be expected to work for any other product, no matter how many of them there are? That's essentially like my convenient grocery store around the corner jacking the price of milk up 300% when no-one else does and you telling me to stop complaining and switch to one of their other 10,000 products, maybe canned tomatoes or anchovies I guess.

Here's an idea; IB could act rationally in general and provide an explanation when they can't or else their customers will go elsewhere. It's how the rest of the world works, not sure why you folks seem to think IB can do no wrong and the customer needs to conform to their idiocy without question.

 

[atrocious]

IBKR now charges absurd margins on VIX calendar spreads. According to CBOE the margins for tier 1 spreads (M1, M2) are $2200/$2000 and for tier 2 spreads ( M2, M3) $770/$700. In comparison IB charges $4860/$3888 for (M1,M2) and $10086/$8069 for (M2, M3). This makes no sense and definitely means I need to look for another broker...after 10 years

$10000 for -M2/+M3 is outlandish, anyone call CS?

 

[truetype]

Should a broker's customers really be expected to switch instruments because the broker does something ridiculous without explanation? Especially when VIX is a rather unique product and strategies developed for it wouldn't be expected to work for any other product

That's my point. A lot of "traders" at IB are actually pennies-in-front-of-the-steamroller players who can't make money in other markets.

 

[penguin-police]

Anyone know how to get the new 3-month volatility ticker VIX3M which replaced VXV to show up in IB? First ticker symbol I've seen with a number in it. Odd.

 

[HobbyTrading]

Anyone know how to get the new 3-month volatility ticker VIX3M which replaced VXV to show up in IB? First ticker symbol I've seen with a number in it. Odd.

I don't know about that specific instrument, but there are many instruments at IB which have a number in its symbol. Some examples: 3KTB (Korean bond futures), ESTX50 (European equity futures), V2TX (European volatility futures), M6E (mini forex futures EUR/USD), and so on.

 

[HobbyTrading]

After having increased the margin requirements for US volatility instruments, has IB now sent a message that they will increase the margin on several non-US volatility futures instruments. Mentioned in the message are: FVS FUT and FOP, NKVI FUT, VHSI FUT, and non-US ETPs related to V2TX and VIX. IB will gradually increase the margin requirements on these products until November 6th, when the final margin values are achieved.

 

[JSOP]

I don't mind them raising margins on VIX products and I understand why they would want to do that. But the way IB is doing it is just WRONG!! They are NOT really taking into account of what's actually happening in your account and instead is just applying the margins blindly to your account, holding back your funds just to prevent you from shorting the VIX products even if you have enough cash in the account to cover any shortfalls AND also have entered hedging trades FIRST that would've completely covered any potential risk. Basically all they are doing is as soon as they see you are shorting VIX products, they lock your account and then they have this person manually checking your account and to see that everything is OK, then they release the lock and by the time when they have released the lock, the price has already moved away from the original time when one wants to short it so one is getting into a position at less favourable prices and that just puts them at even more risk at suffering losses. And that's not only increasing the risk for the traders but also putting IB at higher risk for losses too.

I don't understand WHY IB cannot automate this process and be able to assess risk and calculate margin on an overall portfolio basis taking into account of ALL transactions and positions instead of relying on a manual process that focuses on individual trades. So typical of IB, having some idea of doing something but never doing it right! And then traders just end up getting screwed in the process.

 

[truetype]

My main broker (I can't disclose the name) is still charging CFE exchange minimums on VIX. I suggest you stop b¡tch¡ng and look around.

 

[SoCalOptionsWriter]

Does anyone know who this broker is or was? I'm shopping around. The VIX spread margins at the majors don't seem to make sense given the size of the contract.