Most guys find paying 60k a year in leasing a seat to be a total waste as well as the .50 per contract you have to pay the CBOE for payment for order flow.
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Line of Credit For Day Trading Margin Calls
- Thread starter ryleg
- Start date
Most guys find paying 60k a year in leasing a seat to be a total waste as well as the .50 per contract you have to pay the CBOE for payment for order flow.
Quote from Maverick74:
There is no other way. It is illegal for any other entity to lend credit for the purpose of satisfying a margin call to a retail account.
A BD cannot lend the retail customer credit. But a private entity that is outside the SEC and FINRA arena can lend someone cash to meet a margin call.
I know of some people with money that are looking into a business model for this type of setup because of the TUCO aftermath. They are looking to lend money to traders, into the trader's individual retail account so the trader has more buying power through PDT. They will only make money off of charging a yearly interest rate to the trader for the money borrowed. But also have a model for Blackboxes that need money for PDT margin calls. Right now they are examining the ways to set it up to protect themsleves from traders and others from just taking the company's money out of the account and walking away with it. And at having the BD place control risk on account to stop the account from losing all the traders money and then the company's money before the company can get their money out of that account. Unfortunately it will probably be at least two months before this business comes online, if it does. So that won't help the thread starter in the near future, sorry.
There are ways to get the money. It is something other than the JBO. I cannot reveal such information in a public forum (it has value).
Quote from Maverick74:
There is no other way. It is illegal for any other entity to lend credit for the purpose of satisfying a margin call to a retail account.
"There is no other way.": R U sure about that Maverick? Maybe you mean it in a specific area, but if the purpose is to get the money, then there are other ways.
i have a 600k loc for this purpose. as others have stated, you won't be able to get a significant loc unless it's secured by some asset such as real estate. the only unsecured loans available are credit card or personal loans but they'll be too small for your purpose.
the one problem with helocs is that they can be frozen when home prices drop, as is happening now.
the one problem with helocs is that they can be frozen when home prices drop, as is happening now.
Quote from blackjack007:
i have a 600k loc for this purpose. as others have stated, you won't be able to get a significant loc unless it's secured by some asset such as real estate. the only unsecured loans available are credit card or personal loans but they'll be too small for your purpose.
the one problem with helocs is that they can be frozen when home prices drop, as is happening now.
There are other ways.
Quote from Maverick74:
You need to be trading in a JBO. You would never have this problem. This is by far the simplest and easiest solution.
Maverick, this does seem to be the way to go. Can you give more details as to how one goes about this please? Licenses, fees, paperwork, etc? How much margin could really be available?
Thanks
Quote from ryleg:
Maverick, this does seem to be the way to go. Can you give more details as to how one goes about this please? Licenses, fees, paperwork, etc? How much margin could really be available?
Thanks
It simply is not cost effective to run a JBO on your own. Your best bet is to join a firm that has a JBO. A JBO can cost 100's of thousands to set up and 50k to 100k a year to maintain.
Quote from Maverick74:
It simply is not cost effective to run a JBO on your own. Your best bet is to join a firm that has a JBO. A JBO can cost 100's of thousands to set up and 50k to 100k a year to maintain.
Not to mention that you need to keep a minimum of $1million in the JBO at all times.