Do you mean you call a large brokerage, in Poland, or other countries IB is not offering, like Brazil or Turkey, and ask them to execute that trade without having an account with them ? I have a hard time figuring out how to get someone in a brokerage one doesn't work with interested enough to pass one through to the right contact person there, than set up the trade execution, currency conversion, and give it up to IB, with an the process repeated upon exiting the position, possibly over several days each time. It's hard enough getting information from a prime broker to open an account there for a private trader I doubt they would be receptive to those queries, and while retail brokers are easier to reach, getting to the right person and process sounds sketchy. Did I understand you wrong ? Also anyone knows how Ib would calculate the margin requirement in such cases ? Would it be systematically 100% ( yep... I haven't read yet the google links, but if someone has feedback on those specific questions it will be welcome)
A give-up is the process of executing somewhere and clearing somewhere else. If you have a prime brokerage account with NewEdge, it is completely normal to call an inter-dealer broker in Brazil and ask to open a relationship with them. These are often human-based relationship, e.g. you call someone from the inter-dealer broker firm in Brazil and ask to buy whatever brazilien security they offer and give-it up to your PB at the end of the day. The process of give-up is standard and everyone in the idb (inter-dealer broker) and pb world is aware of how it work. For example, if you wanted to trade Turkish bonds, you could call GMG from dubai (gmg-brokers.com) and ask them to open a relationship to clear their trades with your socgen account. GMG itself doesn't hold your money. you can't open an account with them and deposit money, they don't do that. you can call them and ask for a quote for 500k$ (or 50m$ or whatever) for a given Turkish security, and if you're executed they'll give them up to your PB. This means GMG needs to have an agreement with your PB.... but most PBs have agreements with most inter-dealer brokers and execution-only brokers.
Thanks again WG, quite instructive. I feel out of my depth with inter dealer brokers and actually had to google it, it appears they are more geared toward fixed income, fx products and larger institutions, but might give this set up a try. Also rather than knocking at Newedge or a similar company's door if my volumes pick up again, which is not too far fetched, I might try IB's prime brokerage before that and see what they offer, they are probably easier to enrol than the bigger banks. Although they do not seem to directly offer more markets than regular IB's accounts, they can probably point their customers to some of their inter dealer relationships to access those lacking markets and products.
If the above broker charge cheaper brokerage than IB (for example) for the amount, then there will be some customer. For example, if the broker asks monthly min of 10K for brokerage, with $0.1 for 100 share, then there must be SOME CUSTOMER. Furthermore, if some broker asks FIXED 10K every month with UNLIMITED(?) trading, then sure will be. (like Buffet lunch)
It's usually minimum fee + more expensive commissions than IB. I'd say Prime Brokers get 90% to 95% of the institutional business.