IB: earn interest on the first $10,000 with a GBP account?

There's a long thread about using EFPs to gain interest on the first $10,000 with an IB account but this is only helpful if your base currency is USD. If your base currency is GBP (or any non-USD currency) you would be taking on foreign currency risk if you used EFPs. My account is going to be dormant for a few months and I'm wondering whether there's a way of getting interest on the first $10,000 (approximately £5000).

 

Wire the money out, down to the minimum, then wire it back.

 

or you can buy the US EFP and hedge the exchange rate at OANDA or something

 

I'll take you meant sell efp. and thats a good way of getting the interest, it does ties up a little bit of money but what you can do

 

Yes. Sell EFP
Is actually a pretty good deal if you dont mind the hassle to readjust every now and then. EFP pays you 5.4% or 5.5% (See MYL) if you are lucky. Assuming IB does pay interest on all balance, you still only get 4.8%. That's 60 bucks difference in a year for 10K.

 

i have taken currency risk lately as € and £ traded at historic new highs and got "lucky". my funds are € denominated but my base is $ : converted all non-base [£-€-Â¥-₩-A$-HK$] into base when € was hanging around the mid 700.

 

Good idea. Wouldn't it be better to hedge with IdealPro or Ideal?

 

minimum order size at idealpro is 25K USD. ideal would make no sense since you would be converting your balance, at least thats how I understand IB ideal works

 

nevermind. I think you can do with ideal, the interest rate differential might be worse than oanda though

 

Is it worth the hassle for just a few months?
Assumming you go for three months: after tax, commisions and spreads it works out to be less than £50..