Question on over-night margin requirements

Discussion in 'Index Futures' started by Teleologist, Nov 5, 2006.

  1. I am currently trading the Russell emini. My broker is IB. The trading system I'm using requires I enter my first trades of the day 3 minutes before the market opens. IB is hitting me with over-night margin because of those 3 minutes. Are all brokers the same on this? There is a lot of variation on what brokers require for day trading margin but from what I can tell they all seem to have the same requirement for over-night margin.
  2. tele - overnights are set by the exchanges, not individual brokers. So you will have the same overnight margins regardless of broker.

    As for the 3 minutes you are talking about, not sure if there is a way to skirt that and be considered intraday. I would just call/email around to brokers and ask.
  3. Why are overnight margins set by the exchanges but not day trading margins? Why aren't both allowed to be set by the brokers?

    I suspect that all brokers have the timing for over-night margin programmed into their computers and it would be too much trouble for them to make individual exceptions.
  4. nothing could be further from the truth. the broker needs to answer to the exchange's margin requirements, however it can require its clients to have any margin that the broker chooses, either lower or higher than the exchange's requirements. IB's margin requirements are lower than the exchange's requirements. Global Futures for example, require margin as low as $300 per contract for ES/NQ/YM. theoretically each broker can require different margins and can choose different times of the day for switching to overnight margin. you just have to shop around.
  5. Hi 50 cent,

    IB is hitting me with a little over $1900 day trading margin on the ES and over $3000 over-night margin. I don't think this is less than the exchange requires and it's way over the $300 you mentioned. Do you know of any brokers that have lower over-night margin or that will give me day trading margin for trades submitted a few minutes before the open?

    I checked with TradeStation and they have $1,000 day trading margin but it doesn't begin till after the open, although someone told me they are submitting trades a few minutes before the open with them and getting the day trade rate.
  6. in that case, if low margin rates is top priority to you, try global futures. margin won't get lower than that.

    you should however be aware that you can't trade with such a small amount of money in the account. you will be wiped out after the first few losses. that's why margin requirements shouldn't actually matter to you. however - if you want low margin, global futures is one solution.
  7. I checked their website. They have $500 day trading margin on the ES but a whopping $3,900 over-night margin requirement. I just sent them an e-mail asking if they are going to hit me with 8 times the day trading margin for trades entered 3 minutes before the market opens.

    The reason I'm entering trades 3 minutes before the market opens is because the system I'm using is much more successful this way. I'm lowering my risk not increasing it.
  8. i have $300 margin with them. although i trade via IB. anyway don't know about overnight. good luck margin shopping ;)
  9. I don't understand what you mean when you say you have $300 margin with Global but you trade with IB.
  10. i have an account at global but trade through IB. margin isn't everything.. in fact, it's the least important factor in choosing a broker imho.
    #10     Nov 6, 2006