Why IB Liquidate QM Futures Contract?

Discussion in 'Interactive Brokers' started by RedSun, Jan 18, 2022.

  1. RedSun

    RedSun

    My question is that, has IB changed its policy? If so, when this started?

    I know the current status now.
     
    #11     Jan 18, 2022
  2. Your question was already answered in the third post of this thread, by @eastern_warrior. Obviuosly you did not read it.
     
    #12     Jan 18, 2022
  3. maxinger

    maxinger

    strange .....

    I think we need a lawyer to respond to it very accurately and precisely and clearly.
     
    #13     Jan 18, 2022
  4. RedSun

    RedSun

    Anyone can read post #3 that does not answer my question. We do not need any lawyer to understand it.

    If you do not get anything else to say, just let it to be.
     
    #14     Jan 18, 2022
  5. Overnight

    Overnight

    #15     Jan 18, 2022
  6. def

    def Sponsor

    As Bone mentions, the policy change is due to the possibility and new reality that the contract can have a negative settlement price which means the downside loss isn't capped and thus the possibility of large losses in an illiquid contract can not be capped. This was implemented shortly after the negative settlement of the contract in May. I'm fairly certain notifications were sent out to clients.
     
    #16     Jan 18, 2022
    RedSun likes this.
  7. RedSun

    RedSun

    Was this change on all financially settled commodity contracts? Like QG MCL and others?

    Hope you do realize that those financially settled contracts do expire earlier phy. contracts. Also extreme prices can happen over other periods than settlement day.

    It seems IB likes to over-react to make those changes.
     
    #17     Jan 19, 2022
  8. def

    def Sponsor

    The statement is pretty clear - all oil futures.

    Extreme prices can happen at other times but the combination of lack of liquidity and large moves without a chance to manage is a factor. I do not believe we are the only firm implementing such restrictions.
     
    #18     Jan 20, 2022
    bone likes this.
  9. RedSun

    RedSun

    That is fair. TY.
     
    #19     Jan 20, 2022
  10. bone

    bone

    Every FCM and IB that I’ve seen has enacted customer prompt month oil contract liquidation policies.

     
    #20     Jan 20, 2022
    def likes this.