If you are a RIA, CTA, CPO or friend and family adviser, in order to automatically charge adviser fees to your client accounts and increase efficiency and reduce error rate, would you like IB to support MONTHLY automatic bill? For Automatic Billing, IB currently at least followings two options: Option 1. Percent of Annual Positive P&L: Entered as an annualized percentage, applied on an annually basis as of 12/31. Option 2. Percentage of Positive Market-to-Market P&L: Entered as a percentage, applied on a quarterly basis as of 3/31, 6/30, 9/30, and 12/31. P+L is determined by subtracting the beginning period equity from the ending period equity, and removing all cash items such as deposits, withdrawals, and fees for the period. Fees will be calculated and posted by the 10th business day after the end of a quarter. Above Option 1 is per YEAR. Above Option 2 is per QUARTER. But IB current does not support the follow option (per MONTH): NEW OPTION. Percentage of Positive Market-to-Market P&L: Entered as a percentage, applied on a monthly basis as of 1/31, 2/28, 3/31, 4/30, 5/31, 6/30, 7/31, 8/31, 9/30, 10/31, 11/30 and 12/31. P+L is determined by subtracting the beginning period equity from the ending period equity, and removing all cash items such as deposits, withdrawals, and fees for the period. Fees will be calculated and posted by the 10th business day after the end of a month. Per CFTC/NFA regulation a CTA must provide âPerformance Capsuleâ based on MONTHLY (not quarter or yearly) performance. It will make sense if IB can support MONTHLY automatic billing (NEW OPTION) above to support CTA/CPO. Do you believe if IS can support above NEW OPTION, it will significantly reduce your operation cost and increase efficient to charge adviser fee to your client accounts? Please post your thoughts and ideas.
I have also submitted a FEATURE POLL to IB. You can find it in http://www.interactivebrokers.com/en/general/poll/poll.php#cat_acm If you like IB to implement this new feature, please also go to above link to vote. Click "Account Management" sort by "Date Added". Title: Support AUTOMATIC MONTHLY billing for CTA or FF Submitted by: dabao91
IB can support CTA, CPO, RIA and Friend & Family Advisors much better if they add two new options in Automatic Billing System ============== Based on my understand on 11/30/2007, the Billing options below are currently supported by IB: 1. Automatic Billing --- IB calculates Advisor Fees and deducts these fees from your client account automatically and sends them to Advisor as specified. A. Annualized Percentage of Net Liquidation Value applied on a daily basis (enter annual percentage) B. Annualized Flat Fee applied on a daily basis (enter annual amount) C. Percentage of Annual Positive P&L applied as of 12/31 (enter annual percentage) D. Percentage of Quarterly Positive P&L applied as of March, June, Sept, Dec (enter quarterly percentage) E. Monthly/Quarterly Invoicing --- Advisor calculates the Advisor Wrap Fees and removes the fees from client account up to a limit of ________ (enter amount) per month OR ________ (enter amount) per quarter. 2. Direct Billing --- Advisor bills client directly for fees and client pays Advisor directly (IB does not deduct the fees from client account). 3. No Fee ---- No fees are charged by Advisor for managing client account. ============== Below are my suggestions --- Per CFTC/NFA, the performance capsule of CTA must be based on MONTHLY (not quarterly or yearly), so in order to better support CTA, I have the following two suggestions to IB: A. (NEW OPTION) Percentage of MONTHLY Positive P&L applied as of January, February, March, April, May, June, July, August Sept, October, November, Dec (enter MONTHLY percentage) ------ NOTE: This option similar to option D above. But this option is based on MONTHLY per CFTC/NFA regulations. B. (NEW OPTION) Monthly/Quarterly Invoicing --- Your advisor calculates the Advisor Wrap Fees and removes the fees from your account up to a limit of ________ % (enter PERCENTAGE) per month OR ________ % (enter PERCENTAGE) per quarter. ---- NOTE: This option similar to option E above. But this option is based on % (not absolute dollars amount) so that when client account equity increase, Advisor do NOT have to ask client for permission if the advisor fee is over the previous set dollars amount. IB is an excellent FCM. If IB can enhance their automatically billing system by adding the above new options, it will become even much better FCM for CTA, CPO, RIA and Friend & Family Advisors.