I am done with Interactive Brokers! (2019 update: I am back to IB)

[CorpRaider]

I finally opened an IBKR account.  Wow those graphics take me back to scottrade or early etrade. haha.  Fidelity can't calculate my margin buying power correctly, so I had to move some $$$.  I really don't like doing business bigly with financial institutions without a branch at least within driving distance in case I "require assistance."  But oh well, I'm going to give it a try. 

 

I also toy with the idea of working a little as a "friends and family advisor" if and when I retire, so probably not a bad idea to check them out. [I love you granny but you're still paying 1% if you want me to expend the effort required to slightly underperform the SPY.]

Edited March 2, 2022 by CorpRaider

[boilermaker75]

On 6/23/2021 at 4:33 PM, Munger_Disciple said:

 

Just FYI, Schwab's one year agreement is better than IBKR's. IBKR can and does change margin rate basis calculations overnight whereas Schwab actually guarantees the margin rate calculation for one year (for example R = Fed Funds Rate + Agreed Upon Spread) 

 

I just negotiated with Schwab and they offered me a margin rate of 3.5%. It sounds like others have been able to negotiate a better rate? They didn't give me a lower rate because I only have $40k on margin and I told them I did not know if I would be increasing that.

[Dinar]

45 minutes ago, boilermaker75 said:

 

I just negotiated with Schwab and they offered me a margin rate of 3.5%. It sounds like others have been able to negotiate a better rate? They didn't give me a lower rate because I only have $40k on margin and I told them I did not know if I would be increasing that.

I have 0.95% and have had it for a couple of years, but I expect it to go up as fed increases rates.  The margin rates at Schwab varies based on the value of the account to them which in turn is a function of: a) assets b) margin debt c) commissions - if you make a lot of foreign or option trades

[boilermaker75]

37 minutes ago, Dinar said:

I have 0.95% and have had it for a couple of years, but I expect it to go up as fed increases rates.  The margin rates at Schwab varies based on the value of the account to them which in turn is a function of: a) assets b) margin debt c) commissions - if you make a lot of foreign or option trades

 

Thanks Dinar. I make about 250 option trades a year. This account is low 7 figures and my margin debt is $40k. I should probably call back and argue for a lower rate?

 

Edit: I know the rate is going up as you stated, but if I had 0.98% I would have a higher margin debt.

Edited March 14, 2022 by boilermaker75

[Dinar]

1 hour ago, boilermaker75 said:

 

Thanks Dinar. I make about 250 option trades a year. This account is low 7 figures and my margin debt is $40k. I should probably call back and argue for a lower rate?

 

Edit: I know the rate is going up as you stated, but if I had 0.98% I would have a higher margin debt.

I presume you have a representative that is assigned to your account?  I would contact him/her and ask for a lower rate.  Also, yes, if true, say that I would have x if rates were y

[boilermaker75]

9 minutes ago, Dinar said:

I presume you have a representative that is assigned to your account?  I would contact him/her and ask for a lower rate.  Also, yes, if true, say that I would have x if rates were y

 

I do, but he was out-of-town for two weeks  so I spoke with someone else.

 

Great suggestion. I'll come him when he is back in the office. Thanks.

[Munger_Disciple]

3 hours ago, boilermaker75 said:

 

I just negotiated with Schwab and they offered me a margin rate of 3.5%. It sounds like others have been able to negotiate a better rate? They didn't give me a lower rate because I only have $40k on margin and I told them I did not know if I would be increasing that.

 

Dinar is correct. Schwab evaluates each client's margin rate based on various factors including total assets at Schwab & margin used. At the end of the day, they try to figure out how much profit they could make off you and give you a quote for margin rate. So it is highly customized. 

[boilermaker75]

24 minutes ago, Munger_Disciple said:

 

Dinar is correct. Schwab evaluates each client's margin rate based on various factors including total assets at Schwab & margin used. At the end of the day, they try to figure out how much profit they could make off you and give you a quote for margin rate. So it is highly customized. 

 

Thanks @Munger_Disciple, I am going to follow Dinar's suggestion and talk with the person assigned to my account as soon as possible. I will point out the multiple other accounts at Schwab and additional margin I would be willing to take on.

[Cevian]

22 hours ago, boilermaker75 said:

 

I just negotiated with Schwab and they offered me a margin rate of 3.5%. It sounds like others have been able to negotiate a better rate? They didn't give me a lower rate because I only have $40k on margin and I told them I did not know if I would be increasing that.

 

Base Rate? or Effective Rate?

[boilermaker75]

5 hours ago, Cevian said:

 

Base Rate? or Effective Rate?

 

When I started the discussion I had quoted the effective rate, but I am not sure if the 3.5 % refers to base or effective. I'll let you know when I get the confirmation letter. In any event, I will be calling the person assigned to my account, as Dinar has suggested, to further "improve" the rate.

[boilermaker75]

On 3/15/2022 at 2:29 PM, Cevian said:

 

Base Rate? or Effective Rate?

 

I just got the letter. It is effective rate. Technically it is the upper limit of the Fed Funds Target Range plus 3.25%. So currently my effective rate is 3.5%.

[Munger_Disciple]

2 hours ago, boilermaker75 said:

 

I just got the letter. It is effective rate. Technically it is the upper limit of the Fed Funds Target Range plus 3.25%. So currently my effective rate is 3.5%.

 

Your rate is 3.75% now. Fed just raised rates last Wed so the upper limit is 0.5%. 

[boilermaker75]

5 minutes ago, Munger_Disciple said:

 

Your rate is 3.75% now. Fed just raised rates last Wed so the upper limit is 0.5%. 

 

The letter was put together and sent on Monday, so it reflects the Fed rate at that time. 

 

I'll be calling the guy assigned to may account to try two negotiate lower. He is back in the office next week.

[Cevian]

1 hour ago, boilermaker75 said:

 

The letter was put together and sent on Monday, so it reflects the Fed rate at that time. 

 

I'll be calling the guy assigned to may account to try two negotiate lower. He is back in the office next week.

Thanks for the reply. I did call Schwab last week and they said they would come back to me with a lower rate. I'll let you know when I hear back.

[boilermaker75]

1 hour ago, Cevian said:

Thanks for the reply. I did call Schwab last week and they said they would come back to me with a lower rate. I'll let you know when I hear back.

 

I'll let you know how my renegotiation goes.

[bilo]

I suggest anyone using IBKR to use the desktop version and switch to using "classic TWS".   My work area is a bunch of tabbed watchlists that look like spreadsheets and link to a chart if I click on a row.  Thats it.   Has worked fine with minimal issues for over 15 years.   

[gfp]

Yeah, that's what I've been using for something like 15 years as well.  The desktop Java application, "Classic TWS."  Works fine on a Mac, handles as many monitors as you want, and totally configurable to look and behave however you want it to.

[bizaro86]

I actually quite like their app. Stable, fast intuitive. It can handle everything I need including option combos and is less complicated than TWS.

[TwoCitiesCapital]

On 3/30/2022 at 1:05 PM, bizaro86 said:

I actually quite like their app. Stable, fast intuitive. It can handle everything I need including option combos and is less complicated than TWS.

 

+1 

 

It's not pretty, but it gets the job done. Largely, I'm a happy customer. Only time I have issues is when I have to call in for help, but that is rare. 

[Mephistopheles]

Anyone know what the margin requirement for OTC securities is at IBKR? I think OTC stocks are not marginable but just making sure. If the stock is listed in a foreign exchange it may be better off buying it on that exchange instead of OTC in that case, right?

 

Also, I heard small caps are not marginable (less than $500m market cap). Is this the case?

[changegonnacome]

16 hours ago, Mephistopheles said:

Also, I heard small caps are not marginable (less than $500m market cap). Is this the case?

 

Cant say across the board - the only small actually micro-cap i hold is Hostelworld......and on IBKR it indicates the margin requirement for HSW is 100%.......HSW is ~$150 mkt cap.......its also listed on LSE so maybe that factors in too to margin allowable

[Red Lion]

I switched over to interactive brokers a couple months ago, and am overall pleased with the move, but there are a few things that are driving me a little crazy. Maybe I just don't know how to use this correctly, maybe someone has a workaround. 

 

I'm looking for an easy way to look at my YTD dividends/interest/st/lt realized gains. It seems like the only way to get this is to run an activity report for the YTD and then parse the relevant information. There has to be a simpler way to view this information. These are all pretty standard and easily accessible with Schwab and other brokerages, so I'm sure I'm just a luddite that can't figure it out. 

 

Another annoying thing, I have some TIPS with market value that regularly but not all the time get misreported on the mobile app which throws off the daily P&L figures. 

 

Also, I've got to say, I looked at the amount of interest I've been making on stock lent out by IKBR, and it's negligible. I'm going to try to opt out. 

Edited May 26, 2023 by RedLion

[Mephistopheles]

@RedLion Welcome to IBKR. Their platform sucks and I've learned to live with it 

[backtothebeach]

52 minutes ago, RedLion said:

There has to be a simpler way to view this information. These are all pretty standard and easily accessible with Schwab and other brokerages, so I'm sure I'm just a luddite that can't figure it out. 

You can create and save custom reports where you select only the items that you want to be included.

[Red Lion]

I'll just put my head down and take it, figure out how to run a custom report, and call it a day. Honestly I switched mostly because I wanted access to cheaper margin rates, but I'm not currently using margin, and just wanted optionality to make a cash real estate purchase if something came up where I needed some reasonably priced bridge funding.