Don't confuse the FDIC insured "personal" bank deposit coverage with the SIPC coverage of $100,000 in a brokerage (not futures) account. Of course IB rolls your idle futures funds into your brokerage account so they are covered to a large degree. Jack
JPM got trashed today, BAC is trading at 1995 levels. These banks are trading like there going bust. When a panic run start it's all over. Banks can't function with out the masses deposits. Sort of funny how banks need our deposits, but if you ask them for money it's a diffrent story.
I'm a bit confused ... can someone please set the record straight in simple terms? It seems clear that SIPC covers up to $500k in securities held in a brokerage account, but how much end-of-day cash in an IB margin account (which trades stocks, futures, and options) is insured? I thought it was $100k, despite the recent hike in FDIC coverage to $250k for bank accounts.
Bank - FDIC $250K per covered account (Currently to revert to $100K at the end of 2009) SIPC - $500K total per securities (stocks and stock options) account of which up to $100K may be cash. Futures are not covered in any way by government or quasi-governmental entities. Jack
That was my impression - thanks. The IB website mentions additional Lloyds of London coverage up to $30mil for securities and $1mil for cash, subject to an overall limit ... but not quite sure how that comes into play or how the cash sweep thing works. http://www.interactivebrokers.com/en/accounts/accountProtection.php?ib_entity=llc
So lets take an example. IB account has Liquidation value of $500 000 Security values fo $100 000 IB goes bust, So SIPC pays $100 000 for the securities and $100 000 for the cash and Lloyd's pays the remaining $300 000 assuming that they don't have to pay more than $150 000 000 in aggregate I am right in this analysis?