Interactive Brokers Incorrect Option Margin Requirements

They don't. It is easier to code in one risk rule then many. They did the same with my BABA example.

 

I agree. Pretty poor display of sheer laziness imho as someone who has coded similar stuff, but that's their model.

 

Grooming for a sale ?

 

@Robert Morse, what if clients are long but leveraged? So... long 400 stocks @100 with 30k capital... they would be subject to IB's margin rules. Same would go with a long call or put spread...

Maybe OP has more positions which are leveraged/over own capital... so a long call spread is bought on margin and needs to adhere to those rules.

During GFC I was long stocks incl AMBAC... and short some options... (again ) then margin on the options wasn't covered anymore due to the floor collapsing and IB was liquidating some AMBAC (which ended up being a good thing since it dropped way beyond what the liquidation level was).

Not saying that IB's margin rules make total sense... they don't...

 

I'm not a expert of what IB does. And, they seem to change their risk rules often.

 

I'm sure IB is tired of being gamed by undercapitalized "traders" with huge tail-risk exposure.

 

How are they being "gamed" exactly? How can you or they lose more than the purchase price of a long stop or option or the max defined loss on a european options spread? That's the topic of this thread, not if IB can or should increase allowed leverage.

 

Do you even understand what tail-risk means ?

 

Jack, in one account I own 50K in options, have about 50K cash. My initial margin is over 50K, so I can;t open a new position. So, again my portfolio: 50% in being long options, 50% cash, where is risk? where is logic ? Lets stop talking about hypotheticals here. Show me the risk ?

 

Actually it's all a hypothetical with out seeing a money line. Black out the ownership details and post your money line.