I believe leverage is even higher for the outright futures traders ( their margin requirements are lower) than for the option writers.
i rest my case. many (including me) would say, the wimp is the one who is nasty knowing that he never will see those victims. can you honestly say whether and how many times you have gone bust...or even maybe negative debit ? mine was trading eur/usd futures when i first went on my own. since then that same account is over 400k usd and about 200k is drawn out per year going on 6 years. mostly selling index options to buyers. all true without any insults...er...dickhead.
Yes, good news. With declining assets, IB stock will go down. Time to short IB. If span is not safe enough, does it mean that CME is very risky. LOL.
How do you know IB's customer assets will go down? Perhaps IB's customer assets will go up! Perhaps risk-averse traders will recognize that IB is the safest place to be, and even safer than before, because increased margin requirements are driving away the gamblers who create most of the risk to assets of other customers. Perhaps the influx of new customer assets, from risk-averse traders, will exceed the outflow of gambler's assets created by increasing margin requirements.
I'd venture a guess that there is a negative correlation between the magnitude of put selling and account values. Even more negative now that niederhoffer is out of the market. OP -> IB raised margins on vix derivs 10 fold in August so 150% is nothing in this environment. Stop abusing span and trade within regt notionals. If you cant afford to sell the SPX put, dont sell the ES one.
i would also venture to guess that excessive futures trading, lack of experience, and undercapitalization , has a negative correlation on account values. let's face it, because of the public blow outs of people such as vic and other lesser knowns, it is too easy to make pot shots at vol sellers. you guys are like sheep who do such. why can't you all see that all traders blow up consistently? what makes your vix time spreads any different than vanilla hedged option writing, whether they are straddles, spreads, or naked? you went from spx spreads to vix only recently, you know there are dangers ahead. don't get me wrong, if you opened a restaurant or any type of business, the same blow up rate is there. i spend every day doing vAR, building my book with hopefully well placed offsets. you can lose on an incorrect model play. i would be willing to bet because of ib's 10 fold vix margin increase, you adjusted your size; thus possibly keeping you from blowing up also. i am certain, the margin increases will benefit us in keeping others from going overboard. lastly, we must all remember as options traders, the increased vol also pays more, so size can decrease or as my handle alludes to...go even further otm!
I have no problem with IB increasing margin. However, imo if they really have a plan to reduce the risk, they should send the schedule in advance, not one hour before they implemented the new rule. Can you trust a brokerage firm who change the margin rule any time they "feel" they like it? Perhaps one day, they feel "no margin" is the safest way, and they liquidate your position to satisfy their "safest" rule. I know it is a black swan, and it "never" happens. But should we protect ourselves from black swan? I am just angry that they changed the margin rule an hour before the implementation. As I have said before, they should send the schedule to every customer if they indeed have a plan. I don't understand why "risk-averse" traders like to see a surprise on their margin requirement.