Finally an intelligent discussion on ET. There have been interesting points on IB's margin issues raised here with the one area of agreement being that the $3,500 for ES (actually $3,938 now started Aug 31) being too high (and the $3,938 today being even more out of line). I can say in the larger rooms I hang in during the day, the longer this has gone on, the more I have seen traders leave IB over this issue. These are both large accounts and smaller ones, and many who's size I don't know. I am not sure what the tipping point will be on this or even if there is one. IB does seem to try, to the best of its understanding, to be a very conservative broker. In fact I think there was a time many years ago that IB didn't give any intraday margin at all, for years. There was even a time when IB did not want to add Stop (Bracket) orders for fear that it would exaggerate a market move (don't ask). The point of my saying this is to try to give the view of what is going on inside the minds at IB and why you see and what you will likely continue to see from them.
wow another day that IB raised margins NQ was 1625 when I checked over the weekend, now that one has gone up to 1938. What's the excuse this time?
Yes those are the overnights from IB, but not for intraday trading. Actually, the NQ is about the only e-mini I can think of that the margin has stayed about the same since this so called "volatility crisis". Definitely in comparison to other instruments where they doubled or even tripled (!) the margin requirements.
IB did not increase anything voluntarily over this Weekend. CME increased margins and we must follow. We keep our 4% intraday policy for now.
Why 4%? Why not 2% or 3%? I was just in the process of refunding my account today due to medical problems I've had that kept me from trading this last year and was startled when I looked up the intraday initial and maintenance margin on YM, ES, and QM, especially. These all seem to have doubled since last year. And to be honest I cancelled my deposit request for now until I research this more.
high vix was IB's original justification for the burgeoning of initial margins requirements; volatility has already dropped to pre-correction levels quite some time ago and has taken a dump recently with index futures trading in a very narrow range. it's in our interest now to know for how long you are gonna keep this 4% policy and the real reasons for doing so. unfortunately this huge increase in the cost of doing business has become unacceptable to me and likely many other clients; with so many cheaper alternatives out there i need to know your intentions as time is nearing for me to make a choice and improve my capital deployment efficiency. thanks in advance
I agree. Time to change them back. Global and a couple of others are starting to look more attractive to me.
When you are in a market leader position, like IB is at the moment, you don't have to provide a reason.