Anyone analyse on the survivability of IB in 2020?

Discussion in 'Interactive Brokers' started by Jason11111111, Mar 15, 2020.

  1. Anyone analyse on that care to share info?

    Don't wanna be caught in a broker got wipe out by customer's exposure, nor bad operating measures.
  2. padutrader


    I doubt any big broker will fold.
    they normally have margin calls and one reason for this fall may have been brokers liquidating client positions at any price
    murray t turtle likes this.
  3. gaussian


    IB won't fold. They are so aggressive on margin I doubt they're really sweating it at the moment.

    We will probably see a super aggressive drop as all the longs that got margin called and weren't liquidated before the limit down get liquidated in the morning. 2000 point drop? Maybe. I'd imagine many plungers are puking their guts out right now.
  4. They’re super over capitalized too. Watch for rising margin requirements for customers though.
  5. def

    def Sponsor

    It is funny, on one side there are gripes because we are tighter than what seem to be most others on margin yet still get questions like the one above. During such chaotic times, it does remain valid so I ask you to compare other firms and make an informed decision. Please read the link below on our strength and security. It may provide some comfort. My thoughts/comments:
    • First and foremost, IBKR is extremely well capitalized with over $8 BILLION USD in shareholder equity. That would be one heck of a lot of client exposure to burn though.
    • Unlike most brokers, we monitor exposure real time to each and every client as well as a number of other metrics such as specific product and currency. We know where to focus and don't waste time reacting when a client goes into a deficit or negative liquidity.
    • Unlike most other large brokers and banks, our management and staff have significant skin in the game owning over 80% of the company. No one has a greater incentive to manage things more conservatively than we do.
    • We have a history of transparency and profitability being in the securities business since the late 70s. Our track record through thick and thin speaks for itself.
    I urge you to do your homework, read our history, check our profitability during other periods of turbulence, look at our balance and income sheets and hopefully you'll walk away having additional comfort.

    Link to Financial Strength and Security
  6. In theory, everyone is exposed.

    Accidents do happen as well.

    I assume IB is as unlikely to 'fail' as anyone on the street.

    I have always , and will continue to applaud, blowing out margin deficits without mercy.
    murray t turtle and SteveH like this.
  7. A cleansing of the herd
    SteveH likes this.
  8. southall


  9. guru


    IB has much tighter margin requirements than most brokers and they do everything they can to protect their business. They also have great technology to auto-liquidate positions that exceed available margin.
    Recently they announced that they’re decreasing 10% margin cushion to 5% (you could be temporarily -10% negative, now -5%).
    This is good and bad for some clients for different reasons, but with so much protection on IB’s end I just don’t see how any other broker would survive if IB didn’t. Especially since many brokers don’t auto-liquidate your positions and give you couple days to deposit more funds.
    murray t turtle and SteveH like this.
  10. IBKR will fold during the good times, not the bad. They're a horrible broker with high margins, terrible service, and brain-dead risk management that will drive even the most risk-adverse traders crazy. No way they're going to fold. They'd rather sit on cash than provide a reasonable service.
    #10     Mar 16, 2020
    murray t turtle likes this.