Is My Ira Safe With Ib Whats Ins Limits?

Discussion in 'Retail Brokers' started by stockripper, Oct 16, 2005.

  1. I HAVE A $170K IN A ROTH IRA I ACTIVELY TRADE BUT MANY TIMES I'M IN ALL CASH. WHAT ARE IB'S CASH INSURED LIMIT'S ABOVE THE 100K SIPC. I SEE ITS UP TO $50 MIL BUT $150K AGGREGATE LIMIT. DOES THAT MEAN ONLY $150 MILLION TOTAL CASH AT IB IS INSURED AND WHEN THATS USED ONLY THE REGUALR 100K SIPC WILL APPLY?
     
  2. i jsut read there site. so if sipc eaten up only $150 million in total loses covered above sipc. i guess one should enver put over 100k with any firm
     
  3. hi mr stockripper

    is trading all you do for income?

    who told you that active trading in a IRA or ROTH IRA is

    ok with the IRS?

    good luck ...

    :)
     
  4. lol, this guy has enough stress with the 100k thing, now you want him to torture over the IRS too?
     
  5. I believe IB is extremely safe.

    I would also emphasize that You can't compare the safety of brokers, simply by comparing their insurance coverages. You must also consider the quality of their risk control. I am not aware of any broker having risk management as rigorous as IB's. The likelihood that insurance coverage will ever be invoked, at IB, is therefore far less than it is for brokers with weaker risk management.

    The safety of IB is underrated and underappreciated. People tend to seek the lowest commissions, without considering safety. I think it's very healthy now that people are starting to think about the risk of loss due to broker bankruptcy. But I think IB is rock solid safe.
     
  6. Let me just acknowledge that there is always some risk in holding moneys on deposit with any broker. One risk is that SIPC itself will be wiped out, and that the Federal Government might refuse to re-fund SIPC sufficiently for it to make good on its obligations. Customer property in excess of SIPC coverage limits obviously faces more substantial risk, at any brokerage. I meant that I believe that Interactive Brokers is rock-solid safe in relative terms, compared to other brokers. But no securities or futures or FX broker is entirely risk-free.
     
  7. taigong

    taigong

    It's easy to spread out non-IRA accounts with different brokers to keep balance below 100K. But with IRA accounts, this is a real dilemma. Is there a way to spread a Roth IRA account between 2 brokers to keep balance under 100K? Not that I know of, anyway.
     
  8. why can't you spread a roth ira out?its no different than a regular ira as you can have multiple roth accounts. i'd say sipc is as safe as fdic. no way will the gov't let one person lose his investment to fraud period. if you let one sipc account go unpaid everyone would take there money out of brokerage accounts
     
  9. taigong

    taigong

    This RFX thing really brought up the hidden risk that we normally don't think about.

    As I can see, Roth IRA and regular IRA are same account category, except for the difference in tax consequence at withdraw.

    Using Roth as example, does IRS allow you to open a 2nd Roth account with another broker and let you withdraw half of the first Roth to be put into the 2nd? Would you suffer penalty for withdrawal (distribution before retirement age) from the 1st? Or you can show document of transfer into 2nd to avoid penalty?

    There is the custodianship involved with IRA accounts, and one can only have one IRA account of each type, regular, ROth or rollover, so I really don't know.

    While I look into this, appreciate any input from anyone with the know-how and knowlege of IRS rules in this regard.

    Thanks Stockripper
     
  10. Who told you it wasn't OK? Seems to be enormous misinformation out there on this topic. I mean, has there EVER been a person who has had the tax-free or tax-deferred status of their IRA account called into question by the IRS, simply because they traded the account actively?

    Not to my knowledge.
     
    #10     Oct 16, 2005