this account isn't funded but that doesn't matter... i don't know if its just IB or what.. but this is crazy
Try a dec/jun/dec one and see what it shows. It could be possible this is an IB "issue" which wouldn't surprise me in the least.
I've noticed that on some other spreads before, it is the initial margin that they make insane, but the maintenance will be at a normal level. No clue why they do that.
IB is the devil! haha there margin always has a squeezing intent to it.. flush you out to their favor.. screams of a large bucket shop
I am ass over alligators busy at the moment, but taking a quick look at the CME maintenance margins for CL intramarkets (should be close to Brent) tells me that something is screwy - especially for a Butterfly with only one month duration between legs. I mean, even with only an 80% margin credit ( should almost certainly be more) that's like about $2,400 for late 2017 expiry in terms of initial margin. http://www.cmegroup.com/trading/ene...CL§or=CRUDE+OIL&exchange=NYM&pageNumber=2
There's definitely something screwy going on with far dated spreads. TWS thinks initial margin on a may18/jun18/jul18 butterfly is like 14k whereas something like jan17/feb17/mar17 is 1.1k. I wouldn't be surprised if this has something dumb to do with the underlying contracts not having a bid/ask visible to TWS (rather than the ETS bid/ask which it would have); either way it shouldn't be using either.
Came across this the other day: http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.196.2766&rep=rep1&type=pdf It's fairly academic but still interesting given how little of this stuff is actually out there. However, past 1:3:3:1 my brain starts to explode. He does find one thing many of us have found: In other words: don't even mess with the front.
All this information in your post are things I've picked up over time separately... And through some pain... Pascals binomial expansion is exactly the way risk is hedged with futures...