IB IRA margin

Discussion in 'Retail Brokers' started by stevelevi, Mar 5, 2008.

  1. I am moving my accounts to IB from Schwab
    On my IRA appliction I marked margin account
    Is it really possible ?
    Right now I need to wait 3 days for settelment
    with IB can I avoid 3 days ?
    and can I Day trade ?
     
  2. flbum

    flbum

    I know that I am answering an old posting, but I would like some clarification on this point also. I called IB multiple times and got multiple answers to the same question. I believe that the answer is that an IB IRA margin account is a misnomer as I was told by IB customer service. It appears to be the same as any other broker’s cash account. You have to wait for the 3 day settlement from a funding sale before you can place a sell order on the next morning for a purchase made with unsettled funds. An IB IRA “cash account” can’t trade as many asset types and you cannot purchase a new security at all using unsettled funds… like any other broker’s cash account which has been placed on a freeriding violation restriction. If that is true as I believe that I was told, it would make no sense at all to ever consider the cash account option.

    So, I impatiently wait for 4 days to go by so that I can make my one round trip… what a waste!!! Today was that day…. Yay!!! I was done my IRA round trip trade for the week in the first half hour of trading today. Can you feel my frustration? Yes, all the brokers tell you that you can “daytrade” an IRA. You can buy and sell the same security on the same day. So, technically, I guess they are correct. It sure feels like the truth has been stretched to the breaking point to me.

    Like I said, I got a bunch of different answers and I used what I believe to be the consensus. If anyone else can confirm or refute my points… especially if they are a knowledgeable representative of IB, I would love to know the correct information.
     
  3. cmaxb

    cmaxb

    It's good for futures.