Discussion in 'Options' started by lkh, Jan 7, 2006.
Does IB pay interest on the cash recieved from naked put sales that are open?Tia
sure do, naked calls too!
By extention, interest is paid on any position that is net credit, such as short verticals and IC's, right? Thanks in advance.
Correct, any net increase in credit balance. I liked the rhyme.
and thanks again.
Not only do they pay, the current rate is 4.313% (!), much higher than, say, thinkorswim.
Actually, I don't think that IB pays much interest on the credit balance from short stock sales. As I recall, on the first $100,00 no interest is paid.
That's not quite correct. 4.313 is the benchmark rate and they pay a little less than that depending on the actual balance. For example, between $10,000 and $100,000 they pay benchmark minus 1/2% which is 3.813%. On the first $10,000 I don't think they pay any interest.
IB interest rates on short sales credits are as follows. Current Benchmark (BM) is 4.310%
< $100,000 = No interest
=> $100,000 = BM - 1.25%
=> $1,000,000 = BM - 0.5%
=> $3,000,000 = BM - 0.25%
See http://www.interactivebrokers.com/en/accounts/fees/interest.php?ib_entity=llc#shortCredit for all rates.
Does anyone know what the margin requirement is to sell a naked put on ES Jan 06 with a strike of 1200, for example. I know the SPAN system is used, but is there some sort a approximation that you can use to get an idea?
Securities options seem to be at least 10% of the underlying value. I'm not clear on whether futures options are lower.
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