IB auto liquidation

Discussion in 'Interactive Brokers' started by bestfriend, Aug 22, 2007.

  1. Thanks ids, makes sense.

    No way to use aftermarket as a trigger, too easy to manipulate, though I imagine IB could make exceptions in the case of actual bad news on say a biotech, that cuts the price in half.
     
    #11     Aug 23, 2007
  2. No? I've seen stocks trade at 1 cent and all kinds of high prices.

    All it takes is a trader with a slip of the finger or a program gone haywire.

    Happens plenty.

    Be careful with the word never, as in "I'll Never Go Broke"
     
    #12     Aug 23, 2007
  3. Is this recent?

    In 2005...
    I had a NYSE listed short stock position...
    "Bought in" well after 16:00 on an ECN...
    $1.00 higher than the NYSE daily high.

    This is the most incompetent and abusive thing I've seen in a long time...
    But it ** was reversed ** after complaining to an IB manager.
     
    #13     Aug 23, 2007
  4. It's not just this...

    IB has always had a difficult time valuing NYSE listed ILLIQUID stocks...
    For example, any of the 1000 or so stocks that trade < 50,000 shares/day.

    These stocks often have crazy spreads for a few seconds...
    And even the odd trade $2.00 or $5.00 or even $10.00 off the market due to an order error...
    But instead of using an intelligent approach to valuation...
    IB seems to fall for every head fake and anamoly that occurs.

    It's as if their systems are designed...
    By people who have never made a real-life trade in any stock other than IBM or GOOG.

    Oh...
    And I've been in the business for 15 years...
    And have never heard of any other company "auto-liquidate"...
    Other than IB.

    This kind of UNNECESSARY, autocratic behavior shows utter contempt for the Customer.
     
    #14     Aug 23, 2007
  5. This is unlikely to be a widespread problem or we'd have heard about it.

    I doubt if many are being liquidated just on a widening spread. Or even the random bad print.

    Let's see some proof.

    Not that it isnt possible, if IB is automating everything, they may be at risk for a bad decision a human would not make.

    Since they handle zillions of trades a day, this appears not to be a problem , or I'd know about it.

    And less than 50k a day is not really all that illiquid, I watch stocks that trade <15k a day, and there is rarely anything that would set off a liquidate, unless you are constantly at 100% max margin usage.
     
    #15     Aug 23, 2007
  6. ids

    ids

    No, it is not a recent change. It was set a long time ago. Let me also notice that we are doing many things that nobody does.
     
    #16     Aug 23, 2007
  7. GTC

    GTC

    QuantPlus, I also experienced auto-liquidation once after hours --many months ago. I called and let IB CSR know about it. IB phone CSR understood the issue and mentioned that the developer would be notified about it. May be it is fixed now.
     
    #17     Aug 24, 2007
  8. FGBS

    FGBS

    IB have done a great job at trying to automate everything including the liquidation, keeps costs and risks down for everyone. If you really are scared of the overnight liquidation or the fact tha erroneous trades would trigger such liquidations (which I doubt can and would happan) then simply don't use the margin facility and don't go short overnight, that way you never run a risk. If you expect IB to manually look at each account overnight your dreaming.
     
    #18     Aug 24, 2007
  9. nassau

    nassau

    absolutely and they do.
    many times nyse stocks take over ten minutes to give a tradable bid/ask. if the spread stays dollars like the steel sector does you will be liquidated. If one of the ecn's is late jor down as similiar to options expiry etc you will be liquidated.
    setting liquidate last in your account window does shit as IB liquidates what they want/need and not what is best for you.
    I have a small account I let new traders use to learn.
    they are allowed to do and trade how they like (within reason) to learn a trading style.
    on many occassions they have been liquidated end of day or prior to 940am as a result of bid/ask spreads
    one trader had several thousand shares of a dollar stock for a position trade and another trade had a small short position of a few hundred shares, they had liquidate last on the long position and were liquidated as they bid/ask was dollars on the steel short trade and one hundred shares would of brought them into compliance / balance and they had their long position liquidated.
    IB says we will liquidate what we want and the liquidate last button may or may not be acknowledged. why even have it??
    IB has way to may op that work against the trader.
    I told the trader welcome to the real world. The brokers world where the game is to take your money.

    w
     
    #19     Aug 24, 2007
  10. nassau

    nassau

     
    #20     Aug 24, 2007