JSOP - sorry you don't qualify but do you feel the same when your gym provides freebies for membership or your credit card offers incentives to new clients? The $200 is part of the cost of acquiring a client. Other firms are doing the same or providing other ways to entice new clients. For current clients I'd like to think you have saved far more than the $200 when it comes to execution quality, free tools, low margin, no exercise fees (US options) etc. We are also confident that clients who stick with us and grow their accounts will also consider purchasing additional shares down the line. My perspective (not the firms as I am not the architect or involved in the scheme) is that if you look at this at the extreme, and we were fortunate enough to take on 1 million clients under the scheme, I personally think it would be great for the stock to be so widely held with dilution of under 1% and presumably an increase in revenues that would be a multiple of cost.
I really don't give a **** about the $200. That's IB's cost and it means very little to me and that's actually not what I was talking about in my posts. But since you brought up how much I saved while being with IB, I will tell you that I have actually lost far FAR more than $200 during my time as IB's client in terms of lost profit due to IB's unjustified risk calculations, unfair margin policies that resulted in unnecessary liquidations of my profitable positions, dubious routing practices, unacceptable platform errors and service outages, unfair fee charges, substandard customer service, many I and others have covered in lengths here. And consequently with the quality of service that I have received from IB, I would never recommend IB of course to anyone who's looking for a discount brokerage. I do apologize for my candidness but that's really how I feel. IB has a rating of 2.8/5 on Google (Google has now removed it for some very strange reason) and averages about 3.5/5 on various broker review sites. So obviously I am not the only one who feels this way. What I am concerned about is this rewarding of shares of IB exclusively to new clients now which I was never entitled to when I joined IB simply because I was never referred by anyone and had decided to join IB by giving IB a chance. For all the years that I had been with IB, I had never been offered IB's stock ownership which has appreciated in value I am sure really at the expense of existing clients' suffering through IB's nickling and diming us in every single way possible while providing us substandard quality of service in terms of what I have mentioned above. Honestly all of the revenues that IB is earning right now and has earned is from the existing clients who are trading larger position size, getting more familiar with the trading software so using less of IB's customer service resources and sometimes even been able to help new clients by answering questions on forums like this one and etc.. And yet IB doesn't reward existing clients for any of these benefits that existing clients are bringing to IB and instead chooses to reward new clients with basically the revenues earned by the existing clients? This is what I mean by this rewarding of stock ownership to new clients as a Reverse Pyramid scheme where you don't rob Peter (new client) to pay Paul (existing client) but you now took what Paul (existing client) earned to pay Peter (new client) in order to attract Peter. Yes I do. That's why I leave those gyms and credit card issuers who do not reward existing clients, clients who had been patient with them when they were growing their business correcting their mistakes, stuck with them through the thick and thin, loyal to them during their challenging times. Do you want all of IB's existing clients to leave also? You want to offer something to the new clients? That's fine. But IB better offer something equivalent to its existing clients too or IB will risk losing its existing clients to join other brokerages (like RobinHood) who are also offering incentives to new clients as you have rightly mentioned. IB's all about controlling risk. IB better consider this risk more carefully of not offering something equivalent to what it offered to its new clients to its existing clients for retaining them. Next time read my posts before you want to spin something that I wrote to do some PR for IB. And btw, it's not " , it's their accounts. "There" is an adverb that refers to the position of one place relative to another like "over there", "their" is a possessive pronoun of third-person pronoun which is used here to refer to the accounts belonging to the new clients of IB. A free grammar lesson to you, somebody who needs to write quite often to do PR for IB, another contribution that this former client of IB has made to IB, helping its PR person on an investment forum to write English more properly.
And actually handing out more stocks is not going to result in an increase in revenues, not even presumably. It's the quality and quantity of service that a company achieves that increases its revenues. Another free business lesson to you. But how about making the stock more widely held if you so believe in client retention through stock ownership by the clients of a business? Why does IB think existing clients are less deserving than new clients in receiving incentives than new clients? That's my point.
Sounds like you accidentally went to the general help which is not tied to your account and the CS reps there are not as knowledgeable. Did that once before by accident.
Thanks for this. A follow up: If someone opens an account today with 10k to get the 1% and then 364 days later plops in, say, another 250k, do they get 1% on the whole amount? And can they close the account a few days after the one year anniversary? If not, when?