Sorry but I think with a high degree of confidence that this is bogus. If that was true and you suffered a loss because of that information discrepancy then you can sue IB and will absolute win that case. Similar case was settled and IB had to pay several millions. If I remember clearly then it was a wrong expiration date posted on their contract details for an options contract. Not saying such error may never repeat itself but you make it sound like as if there are numerous cases like that which I don't believe holds true.
there are legal requirements:" Margin Requirement on Leveraged ETF Products Leveraged Exchange Traded Funds (ETFs) are a subset of general ETFs and are intended to generate performance in multiples of that of the underlying index or benchmark (e.g. 200%, 300% or greater). In addition certain of these ETFs seek to a generate performance which is not only a multiple of but also the inverse of the underlying index or benchmark (e.g., a short ETF). To accomplish this, these leveraged funds typically include among their holdings derivative instruments such as options, futures or swaps which are intended to provide the desired leverage and/or inverse performance. Exchange margin rules seek to recognize the additional leverage and risk associated with these instruments by establishing a margin rate which is commensurate with that level of leverage (but not to exceed 100% of the ETF value). Thus, for example, whereas the base strategy-based maintenance margin requirement for a non-leveraged long ETF is set at 25% and a short non-leveraged ETF at 30%, examples of the maintenance margin change for leveraged ETFs are as follows: 1. Long an ETF having a 200% leverage factor: 50% (= 2 x 25%) 2. Short an ETF having a 300% leverage factor: 90% (= 3 x 30%) A similar scaling in margin is also in effect for options. For example, the Reg. T maintenance margin requirement for a non-leveraged, short broad based ETF index option is 100% of the option premium plus 15% of the ETF market value, less any out-of-the-money amount (to a minimum of 10% of ETF market value in the case of calls and 10% of the option strike price in the case of puts). In the case where the option underlying is a leveraged ETF, however, the 15% rate is increased by the leverage factor of the ETF. In the case of portfolio margin accounts, the effect is similar, with the scan ranges by which the leveraged ETF positions are stress tested increasing by the ETF leverage factor. See NASD Rule 2520 and NYSE Rule 431 for further details. Links: Finra Regulatory Notice 09-53 (ETF Margin Increase)
, My portfolio with IB is not that large and i notice 3 mistakes already when comparing the contract details and the margin report. Amd is apparently also wrong. I suspect it gives wrong information on many more stocks
Will take a look later but hard to verify as you claimed it only shows up after a trade. Where does it show exactly? Reflected in your available funds for trading? How are you able to precisely map out the actual margin required vs mentioned on the contract specifics page
u can log in account management and check the margin report on ur actual portfolio if u have bought the stocks and held them overnight to see what margin is applied, default margin is around 15% maintenance for portfolio margin. 1033 is actually 100% and 1800 around 50, whereas they show Default margins on the Contract details, Amd also shows Default Margin. if u haven't bought the stocks it's more difficult, checking Margin Impact on an order will help but this takes into account the overall portfolio and possible concentration penalties , rather than the specific stock rule, and will not necessary give you a clear idea of the stock margin treatment.
Super low margin rates don't matter when you basically cannot have margin loan balance.It was killing transactions that were 4k over my cash balance. Also since I am only holding it for 15-30 minutes, it is ZERO percent at the other brokers. So the super low margin interest rate ends up being NEGATIVE interest rate because the margin maintenance is so high compared to other brokers trading on the exact same stock. Example today alone, I made 612 on my capital one account, 318 on my ib account with the same cash basis. I am going to stick with IB them a little while longer. I am a CS/Math geek that has nothing but linux at home. So having linux support is big one for me, and most of the others don't support linux at all. Linux support - shitty margin maintenance rates = unknown outcome. Long term it might not matter because I am moving towards all my trading done by small linux cluster in my basement. It 4.15 Tb/s non-blocking network throughput and should easily hit more than 1000 Gflops single precision. Its currently doing short term price predictions, but I am not ready for it to go live, so I am doing trading while I tweak it at night, using the previous days information. Probably the hardest thing I have ran into is that pure math people have differently names for the same thing then the finance world. So I am having to do more translating of finance term to math nerd term.
OK, As stated in my more recent post, IB not a match for the way you trade. I left another broker 14 years ago to come to IB for same reason; It was not working their for the way I was trading and it was a better fit at IB. Your energy should be spent finding the right broker for you. Good Luck to you.
It might be in the future because I am moving towards a custom automated trading that will be able to do it much more quickly. I have to trade higher quantities when trading manually. So that is why I am partially conflicted. All the other brokers APIs are either windows only or have high commission per transaction fee.(Windows is banned in the house, if I had a windows pc I think I would have to bless it with holy water and go to confession for using a win pc ) As long as I can do the check margin from the API and it is done locally it should be fine(pretty sure is an api call, just don't know if it is done locally). I just don't want the program trying to submit orders and they don't go through because the program couldn't figure out the margin requirements quickly.
Yep, always a trade off. When you finally get it all perfect , eventually someone will changes something somewhere, the broker, the exchange, etc. or usually in my case the Govt. Adapt and figure out how to work around the kinks you choose to deal with and make money. Good Luck to you.
Scam? If you don't like their terms, don't use them. No need to announce your educational background and living situation in the process.