def, Here I was, getting ready to open an IB account after you said you will offer daytrading margins on the e-minis, now you qualify that with 'select customers.' Could we get more info on the criteria, estimated time etc? Thanks. voodoo
i thought it was going to be offered for all as of last week but it was initially offered to a few dozen clients - presumably to make sure it went smoothly. I imagine it will be made available to most if not all customers very shortly. sorry but that's all the info i have for now.
voodoo, i was able to confirm it quicker than i thought. The 50% margin will be made available to all. It is being incrementally rolled out as reflected in the suspicions I made above. The time frame that it will be made available to all is 2-3 weeks.
Dear def This is what I received from IB today, after opening my account Simone, In response to your questions: 1. Please refer to this page for US emini margin requirement: cme margin page For ES, the multipler is 50. With $10,000, you will be able to trade 2 ESH2 contracts. 2. Please refer to above for NQ margins as well. The multipler is 20. 3. You will get 4:1 during regular trading hours if your account equity is more than $25,000. Then I replied to them in this way If math is a serious thing you are telling me that with an account funded with US10K you can give me the power of buying 2 contracts ES H2, currently trading at US113,000 each. In other words I can buy USD226,000 with USD10,000 In other words IB is giving us a margin of 23:1 (not 4:1) Moreover the initial fund is USD10K, not USD25K What am I missing? Please clarify Thanks Simone
Simone, Your math is still off. Multiply the current value of the S&P by 50 to get the value of the *e-mini* contract. You are confusing the ES with the full SP contracts. http://www.cme.com/products/index/products_index_esp500_about.cfm voodoo
How about an example: If the margin requirement to trade 1 ES contract (S&P mini) is $5000 USD. then for $10,000 you could trade 2. With each tick worth $12.5 (each tick is 25 cents*multiplier of 50) you would earn $50 for every 1 point move in the mini. (12.5 per tick * 4 ticks). So for every $1 move you could get roughly a 1% return. 50/5000 = 1% return. now let's look at leverage: 1130 is roughly the price of ES. with a multiplier of 50. 50*1130=56,500. if margin is 5K you would get 11x leverage.
The margin isn't $5K though: http://www.cme.com/httpwrapper.cfm?...m&beginAfterRE=<body[^>]+>&endBeforeRE=</body voodoo
with that kind of leverage is there a big threat of margin calls and does anyone have horror stories about the emini turning on them with their stops skipped over and/or not being able to cover? there must be astronomical potential downside to holding these contracts and just how easy is it to cover when you need to?
Sure there is a threat of margin calls just like anything else if you don't have the funds to meet the requirement the broker will sell you out or tell you to increase your equity. the spreads are small on eminis during market hours so unless you try to trade in the middle of the night you can just get out/in as normal. The potential downside to holding these contracts has everything to do with the trader him/herself, not the mechanics of trading eminis.
Hi Def, thanks for the info. Do you know if the 50% margin will be for all futures or only US futures? I have asked IB and still not received an answer, and since I was going to move to elocal next days, if the 50% margin is also for european futures, I will stay with IB. Thanks