I highly doubt that having professionally worked in this particular industry for a very long time. A decade ago a firm mispriced binary options and was promptly taken to the cleaners, that's how fast arbitrage opportunities are taken advantage off. There is no way any public brokers post such wide rollover rates that they can be arbed against another broker. But hey, if you find a dummy, squeeze them to death they then obviously deserve it. I just don't think such exist today.
Wow! The most detailed explanation post I've ever read on ET. How refreshing. I'll stick to trading US stocks, thank you.
depending on your network of lenders, your credit rating and history with them and your infrastructure it's perfectly doable. I mean we're not talking about the 3b loans that 3AC scored for about 10% p.a. when the BTC carry was still at 40%. The lenders borrowed from retail at 6-8% p.a. and made a nice profit on that. And they would have kept it if they knew how proper credit scoring worked^^ A 100m margin loan isn't much to write home about if you consider that you get 500k buying power for your 25k FX account asuming a 1:20 leverage...and that's without any due diligence and credit scoring on the lenders side. Market market making operations do that all the time, especially HFTs. Their profit margins typically range from 0.05cts-0.1cts per share on a >50$ stock while doing 5-10k trades per day per stock. Scale that up to about 1000 stocks and you can imagine how much buying power you need to even put these inventories on. I admit, retail punters will never get access to loans like that, because they are not big enough, not connected enough and don't treat trading as a business (-> no idea why and how to make money, no business plan, not full time). So from a retail perspective 100m seems a bit steep
There are several ways to achieve this kind of borrowing yield. One would be to short T-Bills and hedge the interest rate risk... IB seems to offer that if you borrow at least 5 million. https://ibkr.info/article/3419 With 1 % margin that would be an extremly cheap way to borrow assuming they do let you use the money and not keep it seperate. In the hedge fund world this financing approach is far from unusual...
There you go. Why talk about what big institutions get access to? How is that comparable with what YOU can do? There is no "consumer loan" with 3% yield. If there is, please point me (a consumer) to one. Let's stick with what is possible to retailers.
Why are you under the impression that I cannot do it? I never said that everyone can do it but the way I'm setup, it's totaly possible for me to get an 8 digit margin loan at a variable interest rate.