IB is the best broker in the world. I hope they give their faithful customers on head start on the IPO.
5.00 per 1000 trades? Maybe you mean 1000 SHARES. Yes, U.S. stock trades are basically .005 per share, with a minimum of $1 and a maximum of .2% of the face value. No inactivity fees or low-balance fee (although I think you need $2,000 to actually trade anything). They charge interest on margin debt, like all brokers. The only other fee is for real-time quotes - for non-professionals, the "bundle" is pretty much all the U.S. quotes. It's free as long as you have at least $30 commissions in the month; else it's $10 a month.
Question for all, Should I buy $15,000 of the NZDJPY or AUDJPY cross which pays out a respectable interest of around 7%, am I to understand that I will not get paid interest earned on the 1st $10,000? Regards, MM
Correct, no interest on first $10k. For amounts >$10k and <$100k, you'll earn ~5% on the NZDJPY: Long NZD = 7.25% - .5% = ~6.75% Short JPY = .25% + 1.5% = ~1.75% 6.75% - 1.75% = ~5% Even less on the AUDJPY, ~4%. Oh, and you're also running the risk of shorting JPY at multi-year lows, as you're a little late to the carry trade game..
Thanks for clarifying that for me. I am a little puzzled as to why you say I am late the to carry trade game. Be nice, as I have not traded FOREX yet. Right now I am just learning what I can and that was a type of trade that was appropriate to use as an example for the situation regarding interest payouts at IB. Plus I am having too much fun with futures. Regards, MM
A little outdated, but it'll give you an overview: http://www.bloomberg.com/apps/news?pid=10000039&sid=a0gK4Vt__cBU&refer=columnist_pesek If and when the carry trade ever starts to unwind, keep your buy finger close to the JPY fx/futures.
Interesting article, and one that points to the risks in this type of trade. I understand that this "carry trade" is brought on by Japan's almost zero % interest rate. And that the risks of any increase in rates will give rise to the JPY currency and easily wipe out any profits from interest earned many fold over. But are there not other interest rate differentials that could be considered "carry trades"? Great link, thanks for sharing. MM
I have been with IB for about 2 years now and I can't complain about anything other than the margin rates for intraday futures trades. Other brokers like Velocity or Global have $500 intraday margin so why at IB it has to be 3 times higher? Such a high intraday margin is justified in case of small accounts but well capitalized, experienced traders should be allowed to trade with lower intraday margin rates. Because of that I am seriously considering to move my account to Velocity Futures.
IB, however only allows a min of $1mil for T-bills. What is the reason IB sets $1mil as minimum? Can any one explain to me? Why not $500K, $250K, $100K?, etc