Margin account

B

BSOD

Hi there,
So I have been using cash account on IKBR pro. I really wanted to short, but requirement for short was to change my cash account to margin. So I changed it.
I use IKBR these days only for quick scalps, i rarely even day trade. I dont have any long positions.
I have around $13000 of my own money and some EUR change.
So, after they switched account to margin I suddenly have buying power of $72.000.
I have couple of questions.
1. Do I pay interest for that money just sitting in my account, or when I actually use it?
2. Why on earth I can short only about 80 stocks of AMC, if my buying power is $72.000? (shorted yesterday in range 56 to 49.50).
3. I noticed that my EUR cash balance is dropping for the last two days for about 7-9 EUR, not a lot amount of money, but I can't find statement where it says so.
Thanks in advanvce
 
1-) You only pay it when you use it.

2-) Availability. You can't short any amount you want because the firm may not have enough shares for you to borrow.

3-) I don't know about this.
 
BSOD said:
2. Why on earth I can short only about 80 stocks of AMC, if my buying power is $72.000? (shorted yesterday in range 56 to 49.50).
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Right-click "Check margin impact" on your order. You'll see that shorting AMC has an initial margin req of 2x or 4x of the dollar quantity. So your 72k can only short 36k or so AMC.

persistence said:
2-) Availability. You can't short any amount you want because the firm may not have enough shares for you to borrow.
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It wasn't about availability but margin requirement.

BSOD said:
3. I noticed that my EUR cash balance is dropping for the last two days for about 7-9 EUR, not a lot amount of money, but I can't find statement where it says so.
Thanks in advanvce
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If you hold shorts overnight, you're paying interest on that position.
 
IBKR has set initial margin limits against meme stocks at 300% so your max short is ~33% of account equity, in your case 13,000*33%/50=83. Typical portfolio margin initial margin is 17.5% so huge difference.

You're probably looking at your EUR balance translated into base currency (USD).
 
lpope said:
IBKR has set initial margin limits against meme stocks at 300% so your max short is ~33% of account equity, in your case 13,000*33%/50=83. Typical portfolio margin initial margin is 17.5% so huge difference.

You're probably looking at your EUR balance translated into base currency (USD).
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My base currency is EUR, that is why I'm asking because my EUR balance has never changed, but it changed when my account was switched from cash to margin, and when I started short selling.

Never held short positions over night also.
 
Could be the borrow fee then. AMC is running 10-20% annualized so if you're short 4k worth that's 1-2/day in borrow fees. This shows up on statements as an accrual delayed by two days (because T+2 settlement) and is cash settled monthly in arrears a few days after the start of the month. I would have thought you'd be charged in USD though, except maybe if you're trading on Xetra.
 
We will see than in couple of days on my statment.
I only trade US stocks, so nothing to do with Xtera, but as my base currency is EUR this could mžbe the answer
Thank you guys for your generous help.
 
lpope said:
IBKR has set initial margin limits against meme stocks at 300% so your max short is ~33% of account equity,
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Yeah got to be careful with IB. I got in a very unpleasant situation last week. I had covered calls on AMC and GME. Then I went naked. Then I tried to go back to CC, but my orders rejected. I had enough BP, but not enough cash(I have PM account). This is counter intuitive because I was actually trying to reduce my risk! This flip flopping of margin requirement by IB is crazy.
 
lpope said:
I would have thought you'd be charged in USD though,
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He is being charged in USD but that amount is converted daily by IB to his base currency, which is EUR. That's why he does see a reduction in his EUR account value.
 
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