IB allows futures trading in IRA accounts, if the futures go negative that means you could have negative balance in an IRA account. That does not bode well for compliance and regulatory oversight. For example if one had $30000 in an IRA account with futures enabled, and bought 3 contracts of cash settled QMK20's at $1 and $10000 margin on each contract, and the settlement was -$37, then they would have had a loss of $19000 per contract multiplied by 3, bring the IRA account value to negative $27000. Would the customer have to recontribute into the IRA? That does not seem possible.
When oil prices went negative, was it possible to trade on IBKR platform? Did the software get confused and did not allow traders to trade using negative price?
I stand corrected and apologize. Best of luck!!! Would be great if you post here how it ends up being handled.
The software stopped to work. They didn't execute sell orders, their risk managing systems didn't work, and they show a wrong price. Also, the margin requirement wasn't calculated correctly as their software thought price couldn't go below 0. So retail investors with tiny accounts were able to buy huge amounts of contracts.
I'm sorry to hear that. I saw your screenshot about a trade taken when oil price was still positive. If you can't get out of your position when price was negative, then IB platform screwed you. Although I'm a fan of IB, I believe this time this is IB's fault if the software wasn't smart enough to allow clients to get out of their positions when price went negative. In fact, I'm shocked that IB even lets you take the trade in the first place since the May Oil contract is so near to expiry and IB clients have no means to take physical delivery.
Hi. There are more people in the same situation with IBKR. We are already over 20 in a Telegram group. Write me on Telegram: @tradalert