Friends & Family account : wrap fees?

Discussion in 'Retail Brokers' started by GeorgeSoros, May 27, 2003.

  1. Hello,

    Is anybody using IB Friends & family account ?

    Can I charge my "customers" 25% of the Monthly profit, transfered to my account monthly with IB or is it not possible at all ?

  2. def

    def Sponsor

    Here's how they work...

    Advisor Wrap Fees

    In addition to IB's, regular commissions which are automatically billed to the client's account, Advisors have the choice of two wrap client fee billing methods.
    1. Automatically Billed: IB Calculated Wrap Fee automatically billed to the client's account with blanket client authorization with any of the following in combination:

    % of Net Liquidation Value entered as an annualized %, applied on a daily basis.

    Annualized flat fee entered as an annualized amount, applied on a daily basis.

    % of Positive P&L entered as an annualized %, applied as of 12/31 on an annualized basis or on a quarterly basis.

    Commission Markup entered as an amount/product traded, applied on a daily basis (Only available for European clients).

    2. Submitted Invoice: Advisor calculated Wrap Fee manually billed to the client's account with specific client authorization on a quarterly basis. Advisors should submit Wrap Fee invoices on a quarterly calendar basis to:


    fax: 2XXX

    A copy of the Advisor wrap fee invoice will be sent directly to the client's mailing address (specified on the Customer Application by Interactive Brokers) for signature approval before any funds will be removed from the client's account. The client then forwards the invoice to IB at the above address. The Advisor must include the client's full name and account number on the invoice for proper crediting of funds.

     (for proper formatting do a search for wrap fees on the IB site)
  3. Def,

    My understanding is that this one is for me :
    % of Positive P&L entered as an annualized %, applied as of 12/31 on an annualized basis or on a quarterly basis.

    But...Problem is quaterly, is not monthly...

    Can you confirm it is possible that the % fee is taken every month? If not do you know when it will be available ?

  4. def

    def Sponsor

    If I'm not mistaken, it is standard practice to do this on a quarterly basis. I don't know offhand if monthly is possible but I'll check and get back to you.
  5. Def,

    This is possible at all your competitors (I won't name them but I can provide you the names if required).

    It would be good to have it also at IB.
  6. is it possible to use IB Friends & family account to trade 5 of your own accounts at the same time? for instance if you had a personal account your wife had a personal account and an ira and you had a regular ira account and a roth ira account. seems like an easy way to make trades in all accounts without flipping back and forth. anyone try this? def do you know?
  7. sammybea


    Quick question for anyone familar with wrap fees. When filling the form out for IB's Friends and Family account, it restricts me from charging above 30% on a quarterly basis. Is this some kinda law? I am interested in a higher percentage.
  8. Why do you want more than 30% ?
  9. they are supposed to be your Friends and Family. give them a break what are friends
  10. sammybea


    Well the simple answer is that it is a private agreement between family members and myself. However, to my knowledge, while many hedge funds charge 20% they are allowed to charge far above that if they want. I don't have the names in front of me, but its not unheard of 50%+.
    #10     Jan 3, 2004