Is cash no longer fully insured in an IB account ?

who would you advise for options on equity?

 

The idea that you need to have 1 account for everything, comes with a price tag. You can use one broker for stocks, one for futures, one for 401k, one for options. The fact that IB changed without notice, is a much bigger problem then the change itself, you never know what change has happend yesterday. There is no excuse what's however for not letting clients know. IB has some explainging to do, and we want to hear it

 

good question, beats the heck out of me, I'm still trying to figure out what an iron butterfly is. What would happen if you had the ul at one and the short call at the other and one went under?

Does sipc even pretend to cover derivatives? What if they are covered?

 

The SIPC is merely covering their a$$ for a potential major event, like a eurozone collapse/recovery and they are letting everyone know now, who is on, might be on and not on the hook. 2012 will be a pivitol year. With the potential demise/ recovery of EURO/US,etc. economies the markets should see big moves either way and with a lot managers/institutions chasing performance along with recent dismal returns there are probably a lot of highly leveraged folks out there and someone is going to get hurt in either direction.

I prefer to play it safe and have two accounts at two different institutions. One for futures and one for stocks/options.

I don't trust anyone. We all know how Wall Street works, everything is fine until it isn't.

 

On February 3, 2010, Trading Technologies filed a complaint against Interactive Brokers for direct and indirect infringement of five U.S. patents owned by Trading Technologies. The plaintiffs are seeking, among other things, damages and injunctive relief.

Ninjatrader had the same situation going some years ago and they already are paying PER trade to TT in a settlement.

IB didn't want to settle but went to court?

Does anybody has more information on the status of this complaint ?

 

in the mean time is cash in IB secure? Anyone knows?

 

where the heck have you been? 28 pages and that's all we are talking about.

Here, I'll bring you up to speed.

We're pretty sure you are covered up to 500k in a cash account. (does IB even offer a cash account?)

Not sure about a margin account.

Even SIPC doesn't know if you are covered if you ever traded futures out of your account.

So, so far nobody knows for sure.

The consensus is to never keep more than 500k in any one account, and if possible, only trade futures out of one account.

So far nobody has even mentioned private insurance. I think Lloyds offers it.

 

Does the private Ins cover futures as well? what's the cap?

 

Good summary old.

One question to you and others: What do you do if you are a 50m hedge fund? Keep your money distributed at 100 brokers?

I am asking myself what the big guys do about this. If we see the risk with our private accounts, the problem must be much bigger as the accounts get larger and larger.

Or maybe they don't care cause it's other people's money.

 

there is no cap, call up Lloyds of London and ask them for a quote (yes, it will cover your whole account if the broker goes belly up.)