Being both long and short the same security

My bad. I was too lazy to check the actual costs involved at IB before writing my message.

 

What's the aim behind this strategy, how do you wanna profit through this. Or it's just transferring funds from the complex account to flexible a/c?

 

Long and short cash balances are not netted against each other at IB. Say you have $100k in your account, you short $50k in SPY and buy $150k in other stocks. You now have $50k in short sales proceeds that you don't earn interest on, and a $50k margin loan.

The better way is to sell a synthetic because the interest rate will be priced in. You want to choose the lowest strike available so that you'll receive a credit that can be applied to your long positions.

If you're subject to US taxes, you'll likely create a constructive sale and have to realize any gains even though you haven't actually sold in account #1.

 

Your both statements are intriguing. Would you care to elaborate for us?

 

Have a look at this thread. If I understand correctly, you're trying to short with IB to generate cash in that account (rather than just selling in your first account). You won't really get any benefit from that cash. However, when you sell an option you do earn interest on the proceeds and can use them to buy stocks.