IB , interest on cash

Anyone doing anything to get interest on their millions at IB? Mutual funds? , while maintaining most of the buying power ?

 

Is that what it means when it is says USD cash -1.9%

 

Does IB even recognize it as buying power if you are holding something like bonds with excess cash?

 

I do, although I'm not talking of "millions". My main interest is to trade futures. One needs a funded account for the margin requirements of these futures. I don't want to keep that capital in cash, so I invest it in some ETFs.

 

What ETFs do you hold?

 

As a foreigner earning my living in USD, I hold a bunch of different currencies to "hedge" my USD exposure. I prefer interest paying currencies to put the carry trade on my side. For example, RUB is paying 4%, MXN 3.3%, ZAR 6% at IB. It's a lot riskier than a bond but so far the experience has been good...

 

Are you trading the spot currency or futures? IB swap rates for the spot currencies that you mentioned are not attractive unless you are doing huge notional sizes

 

Spot currency. What do you mean by huge notional sizes? IB is paying 4% on RUB on RUB cash > 700000 RUB = 11800 USD. I am not a forex trader at all, so I actually don't know if IB is screwing us. It is just a way to hedge my USD exposure not a trade per se.

 

That is not fixed but fluctuates. I'm running an automated trading system which determines each day what ETFs it considers to be "best". Once per month I update my log here at ET: https://www.elitetrader.com/et/threads/trading-as-a-hobby.305910/page-3

 

With US treasuries you can maintain 95-99% of your buying power and get some interest. Cash is also not bad, IB is paying 0.66% right now (not including the first $10K)