Well, from the original $2k, through $5k and now to $10k it's only a 500% increase. I suppose it could have been even higher. This is clearly to protect us from ourselves.
` to DonKee: DonKee quote "The advice you are giving regarding converting an IRA back to a regular account is beyond horrible." This is a great example of why getting or taking advice from internet forums can be a "train wreck". fxjedi quote: "one can then open a regular trading account at the $10,000 USD minimum by transfering funds..... if one so chooses," ,,,provided your english vocabulary is not too horrible, and your comprehension of reading english is not too horrible, and your sight is not too horrible, then you can clearly see, I had never mentioned anything regarding "converting accounts", I wouldn't call my previous post anything other than factual rudimentary information offering, and if anyone is dumb enough and stupid enough to be spending their time reading this trading forum, or any other internet trading forum for tax advise that they are going to DIRECTLY USE without any further investigation and consultation with a CPA that is an expert in the field regarding taxation in the area of investing, speculation trading and retirement IRA money market accounts.... ,,,then really those people don't have to worry about IRA accounts, regular trading accounts, early withdraw penalty taxation, converting accounts, closing account, transferring funds from one account to another.... because they are more than likely not intelligent enough to earn any money trading the markets, they'll blow up their account down to zero quite rapidly and would have no earnings to report anyways, but perhaps they will be in the need of an expert bankruptcy/debt advisor, though, I hope this helps all those who would have read my previous post, `
Not worth your time FS... Unless IB closes or starts charging fees for accounts not meeting minimum, it won't affect the evangelists here on ET. Osorico
What I'd like to know is the reasoning behind IB's action. Have they done a review of forced liquidations and found that accounts with less than $10K often get hit with IB's magical intra-day moving target liquidation program and subsequently get closed? Account opening and closing probably costs IB a lot in staff time. Have they found that <$10K accounts are disproportionally high users of the Customer Service group for the commission income generated? Do the <$10K accounts produce sufficient revenue versus the infrastructure cost they require? (size and number of the quote servers, historical servers, and trading servers, size\speed of the internet connections associated with each, etc.) Does IB want to decrease the number of small accounts they have to try to get a higher percentage of better-funded, perhaps more active accounts? Maybe all the advertising they started doing the past few years has distorted the way they are doing business versus the way they want to do business and this $10K requirement is a part of their attempt at bringing things back to their business model. Maybe, as someone already commented, they just want that $10K sitting there interest free. Of course what I really believe is that IB thinks that beta testers with <$10K aren't really qualified to evaluate the TWS. This way IB only gets people they consider qualified beta testers even if they don't call us that. Jack
But I am generally an IB "evangelist". I complain only when, in my opinion, they take actions which appear, again in my opinion, to have no justification and I await a coherent explanation of this huge unexpected change, as well. (I'm not holding my breath.)
Surely it's a combination of these. Why look further for a reason. Common sense tells you that high volume pros generating hundreds or even thousands in commissions every day still represent their bread and butter on the commission side, even if newbs do sign up in their droves with 5-10K and then blow through it quickly. Can you imagine the ratio of CS requirement/commission for all those newbs compared to the pros? Bottom line is this - they seem to be really really good at making money in their chosen business. They're doing what they feel is best for them from a business perspective. If it turns out to be a mistake, you'll see the minimums bumped back down.
I wish IB, would let you open a margin account when your 18 not 21. Seems like the only broker that forces you to be 21 to open a margin account.