Interactive Brokers

Discuss your favourite picks, broker, and trading or investment style.
Park
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Re: Interactive Brokers

Post by Park »

Does Interactive allow an investor to have MIP511 or DYN500 in their account? If not, I may have to buy an ultrashort bond ETF. Thanks New Guy for suggesting EFPs, but they're beyond my league.

On a related note, Interactive allows one to lend securities. Any comments on that would be appreciated.

Edited to include the following: MINT looks like it might be a good choice.
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newguy
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Re: Interactive Brokers

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Is the TSX open today or is it just me?

newguy

ok, they're starting to show up now, must be a slow opening.
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optionable68
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Re: Interactive Brokers

Post by optionable68 »

Park wrote:Does Interactive allow an investor to have MIP511 or DYN500 in their account?
Nope
3-time winner of FWF Annual Stock Market Predictions contest
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Re: Interactive Brokers

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I never traded in my life with the exception of simulators. You know, those websites with real data but fake money.
After several months i would like to do it for real. I am pretty new at this but with the comfort of my results in the simulation environment.
I am a software programmer, so can't care the less about how hard their interface is and can, i guess, eventually switch to another 3rd party tool.
I do not want to put there more than $5,000, i will trade very low quantities, say 1-2k dollars per trade but several times per day.
My last (simulated) trades:
100
400
120
10
50
60
150

Therefore to me IB looks very sexy, but!
But, i know that it takes 10,000 to open an account. I need your advice guys, based on these conditions:
- willing to put there 5000, wondering if i can fund the account opening with 10k and take 5 out asap (would they allow me)
- $1-2k per trade
- several trades per day
- cash account, don't want to borrow 1 cent
- no anxious waiting for money suspended somewhere in the air or some kind of wire
- the right and the concretechance to run away without having to fight or to loose too much money because of some hidden fees or whatever they fineprint
- not willing to disclose the financial history of my life to them although i know can show that i did not have any debt ever. basically i will deposit my money from a bank account open just for them and beside my insurance number, bank statement etc. i do not think i need to tell them how many houses i own, that's it


Do you think that IB could fit those conditions?
i know i am kind of they childish naive questions guy, but your help is appreciated, trust me
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newguy
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Re: Interactive Brokers

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j3j3 wrote:I never traded in my life with the exception of simulators. You know, those websites with real data but fake money.
After several months i would like to do it for real. I am pretty new at this but with the comfort of my results in the simulation environment.
IMO, you now have an idea about the least important 10% of the knowledge and experience needed to trade. The other 90% is dealing with the interaction between human nature and money.
I am a software programmer, so can't care the less about how hard their interface is and can, i guess, eventually switch to another 3rd party tool.
They have an API, some people say it's hard but it comes with some instructions and an example program. I've written my own charting and trading and auto-trading software so it can't be that hard.
I do not want to put there more than $5,000, i will trade very low quantities, say 1-2k dollars per trade but several times per day.
You won't make more money than you could at a regular job, but you will gain experience.
My last (simulated) trades:
Is that 2-3 days worth? If you trade several times a day for 6 months there should be hundreds. Are you cherry picking a time after a few winning trades to use real money?
- willing to put there 5000, wondering if i can fund the account opening with 10k and take 5 out asap (would they allow me)
I think you can do that. You need a minimum of $2k in the account (iirc just for a margin account)
- cash account, don't want to borrow 1 cent
A margin account allows more than borrowing, things like forex.
- no anxious waiting for money suspended somewhere in the air or some kind of wire
There is a hold at IB for withdrawals, but not long if it goes to the same account.
- the right and the concretechance to run away without having to fight or to loose too much money because of some hidden fees or whatever they fineprint
There are fees. If you trade several times a day there won't be US exchange fees or minimum account fees, but the TSX data is minimum $6/mo for level1.
- not willing to disclose the financial history of my life to them
Just a little paranoid? They don't care about you, they just need certain info like all brokers.

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deaddog
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Re: Interactive Brokers

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j3j3 wrote: But, i know that it takes 10,000 to open an account. I need your advice guys, based on these conditions:
- willing to put there 5000, wondering if i can fund the account opening with 10k and take 5 out asap (would they allow me)
- $1-2k per trade
- several trades per day
- cash account, don't want to borrow 1 cent
Couple things here;
Cash account won't work as 3 day settlements don't allow you to day trade.
Check with IB but I believe they enforce the pattern day trader rule even in Canada. Minimum 25K in the account and if it fall below that amount they lock you out after 3 trades.
Depending on the position size, Questrade might be your best bet;(4.95 plus ecn fees for less than 500 shares) IB is 1 cent per share for Canadian stocks.
Questrade does allow daytrading. Not sure about cash accounts, I think you have to have a margin account.
"And the days that I keep my gratitude higher than my expectations, well, I have really good days" RW Hubbard
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newguy
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Re: Interactive Brokers

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deaddog wrote:Cash account won't work as 3 day settlements don't allow you to day trade.
Yes you can, even in RRSP's (at TD)
Check with IB but I believe they enforce the pattern day trader rule even in Canada. Minimum 25K in the account and if it fall below that amount they lock you out after 3 trades.
They do and I forgot about that. It doesn't apply to futures.
Depending on the position size, Questrade might be your best bet;(4.95 plus ecn fees for less than 500 shares) IB is 1 cent per share for Canadian stocks.
And 1/2¢ for US stocks. If you're not holding overnight look into unbundled pricing.

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Re: Interactive Brokers

Post by j3j3 »

deaddog wrote:Minimum 25K in the account and if it fall below that amount they lock you out after 3 trades.
Depending on the position size, Questrade might be your best bet;(4.95 plus ecn fees for less than 500 shares) IB is 1 cent per share for Canadian stocks.
Questrade does allow daytrading. Not sure about cash accounts, I think you have to have a margin account.
You sure? minimum 25k for day trading? when i called them they mentioned to me just the 10k. I am in canada but will likely daytrade only NYSE and NASDAQ, just stocks.
BTW, those are the last trades made in one day. Questrade would eat in my profits x5 factor compared to IB and i read very bad reviews about Questrade that i dropped it almost immediately.
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newguy
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Re: Interactive Brokers

Post by newguy »

j3j3 wrote:You sure? minimum 25k for day trading?
http://www.interactivebrokers.ca/fr/p.p ... ginFR&p=dt
I'm sure.

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deaddog
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Re: Interactive Brokers

Post by deaddog »

j3j3 wrote: You sure? minimum 25k for day trading? when i called them they mentioned to me just the 10k. I am in canada but will likely daytrade only NYSE and NASDAQ, just stocks.
BTW, those are the last trades made in one day. Questrade would eat in my profits x5 factor compared to IB and i read very bad reviews about Questrade that i dropped it almost immediately.
That was my experience a few years back when my account fell below 25K. You can day trade the emini futures with less.

If you want to day trade stocks then Questrade with all its bad reviews is the cheapest. Most of the complaints are admin related. I have never had an execution complaint, but then I don't trade that often with them. Customer support is terrible. I like IB much better.

If you can daytrade you should be able to swing trade. Build your account that way till you reach 25K.
You'll be surprised at how things change when you put money on the line.
"And the days that I keep my gratitude higher than my expectations, well, I have really good days" RW Hubbard
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Re: Interactive Brokers

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deaddog wrote: You'll be surprised at how things change when you put money on the line.
Yes, daytrade for sure and likely only on stocks. My idea is not to risk to much money. Therefore 5k should be fine for me, not sure for them. When i called i asked them the following: let's assume that i deposit 10k and that after a month i am loosing 2k, may i run the account even if is below the 10k threshold? they said yes, no problem.
My only issue is that with such a low amount of available money in the account i will trade low quantities but multiple times per day, an average of 10 trades per day.
On 100 shares IB takes $1, questrade 4.95. x2 (buy and sell) it means almost 10 bucks to cash in compared to 2 dollars with IB. Assuming a trade for 100 shares that is around 2000 dollars, it means that if the stocks go up by 1% i get 18 bucks with IB and only 10 with a 4.95 per trade. That's why i can't go to questrade and to many others "per trade" brokers.

But what does the quoted statement mean?
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deaddog
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Re: Interactive Brokers

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j3j3 wrote:But what does the quoted statement mean?
In your case it means that trading a demo account and trading live are two different animals.

A demo account will always give you good fills. In theory you always buy and sell where you put the price in. In practise slippage will cost you a few bucks.

In theory you are looking at how much you can make on any trade. In practice you should be looking at how much you can lose.

In theory you can make money day trading with $5000. In practice you are trading against the best in the business and will likely lose most of your money in a short time. Being under capitalized is one of the top reasons most day traders fail.

In theory you have winning trades. In practise you will have losing trades.

In theory you can day trade with $10000 at IB. In practice the PDT rule gets in your way and with a small account you can't afford to trade at any other broker.

Wait till you have $30,000 then open an account at IB and risk your $5,000.
"And the days that I keep my gratitude higher than my expectations, well, I have really good days" RW Hubbard
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Re: Interactive Brokers

Post by j3j3 »

thanks for your answer, i understand what you mean, that's why i do not want to risk too much and that's why i asked if it's hard to close an account (i.e. my run away condition, among the others), because i am aware that the money could just fly away in a short time and i give for granted that those 5k are lost the same exact moment i start.. On the simulator btw i have 15 minutes delay. But i am not looking to know or predict whether i will make money with daytrading on IB,

i just need to know if they are reliable, not trouble makers, manageable and if there's something hidden in their agreement that i might have overlooked.
At this point, i would like to ask you also about optionhouse
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Re: Interactive Brokers

Post by j3j3 »

I called them, got some doubts clarified, here for your own utility.

First of all, if you open an account with their requested minimum of 10k, you are not supposed to withdraw to go behind the 10k rules.
Which means, you can loose money, fine. You can invest everything, fine. You can't take out money ( i mean you can but there are consequences) to just go behind the rules, they might close the account if their dept. that verifies and monitors accounts realizes that. Reasonable.

About the customer service attitude, i must agree with many reviews i read. IB customer support may be rude although i must admit i experienced waiting times of less than a minute in both the sales and support queue.
I do not care if there are customers of them with 1 million, with those prices they target people like me, not millionaires. Moreover, they should convince me to deposit money, i do not believe i am the one, as customer, that must convince them (or anybody) to accept my money lol, that's ridiculous.
Imagine the scene: "cmon let me take out 3K bucks, i will keep 7K in the account, cmon take my 7k please". You see: it's funny just thinking of it.
In any case, they should start from the basics, something like "good morning, how may i help today" and "have a nice day" would be a good opening and closing for the phone calls.
But so far what i got is "i got 1Million dollars customers, we don't do that"- transferred.
This is just my point of view, feel free to disagree, but i do not give 10,000 bucks to someone that does not seem to want them, life is not that easy.

But now, my question is, where should i go?
I understand most of you guys are kind of billionaires or so, happy for you but not so interested in that...
Again:
- i am willing to risk no more than 5-6K
- day trading, from 0 to 10 trades per day
- only stocks
- quantities that are from 3 shares (yes 3 shares!!! google is at almost 600...) to 3-400 shares depending, of course, on the price. My average volume is 100 stocks per trade.
- would love to avoid scams, delays in moving money (any kind of movement), extra hidden fees and so on.
- if i buy 100 shares at $10 each, i do not want to pay $5 bucks in commission,

is there any company that fits into this?
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Re: Interactive Brokers

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I think dd's idea of depositing 30k and quitting when you lose 5k is the best idea. If you don't have that much, I'd save up. You shouldn't be trading with such a large %'age of your net worth anyway. You won't find cheaper and more products than IB.

I don't know if they're rude and I don't think they are looking for rich clients. On the application you have to fill out how many trades you have done for stocks, bonds, futures, options etc.. They want people who never call and can find the answers on the website. I've never called them even once in 10 years (nor have I called TDWH).

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Re: Interactive Brokers

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Even if i have a 1,000,000 in assets, i wouldnt like to risk more than few thousands, since it is my first trading experience and that's why i am trying to lower any possible loss, including first of all the commissions cost, thus IB looked good.
I do not understand why i should put there more than what i am willing to use, i do not need neither want to trade on margin or borrow money.
There must be another company that fits those conditions. They suggested to me questrade but it's 5 bucks per trade, lightspeed does not accept canadian applicants and optionhouse could almost make it but i read bad reviews and does not accept canadian applicants as well.
Last edited by j3j3 on 14 Jul 2011 18:31, edited 1 time in total.
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Re: Interactive Brokers

Post by deaddog »

j3j3

You’re going to have to adjust your plan. As far as I know IB is the only discounter that has the inexpensive brokerage fees you need for your trading to be successful.


It’s not a case of IB having to seek out customers. As you found out they are not interested in small accounts. The services they offer to traders is by far the most cost effective in Canada. You are not going to hurt their feelings by not opening an account. You need them more than they need you.

My only suggestion is to see if your trading strategy won’t work with a longer time frame and consider swing trading. Even at that you will need $10k to keep your account open.
"And the days that I keep my gratitude higher than my expectations, well, I have really good days" RW Hubbard
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newguy
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Re: Interactive Brokers

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j3j3 wrote:I do not understand why i should put there more than what i am willing to use, i do not need neither want to trade on margin or borrow money.
You don't leave it there, you invest it in whatever it would otherwise be invested in.
There must be another company that fits those conditions.
I haven't found one in Canada. If you look at US brokers it's very hard or impossible to open an account.

I think you're ruling out IB because you didn't enjoy your phone conversation, that's fine but it will cost you money.

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Re: Interactive Brokers

Post by j3j3 »

i do not agree, i am a european citizen too. I do not need to open an account at any cost in canada or us. If they do not need customers, which is hard to believe for ANY kind of business, good for them. But if does not hurt them to loose customers, for sure it does not hurt me to avoid to loose money.
Independently from what i enjoy, if someone wants me to deposit 10K bucks they have to be nice with me, if i am wrong then go buy a car while the vendor is rude with you. so plain and simple....

I will find my way, that seems to be not through IB, but if i needed them, i was not going to give up on them, which i did already and not because of their manners, but because i decide what i deposit and it does not fit their minimum. Maybe i am so wrong... but that's what i think now.
Europe seems to me more competitive in terms of prices, i am checking eToro now.
But guys, no need to argue, unless you work for IB lol, i am just trying to find the best place for me, not the best place for IB,
open to suggestions and no intention to deposit more than 5-6k! i won't move 1 cent more, no matter what
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Re: Interactive Brokers

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it's a pleasure to talk to you guys, but i discovered that in order to daytrade on margine there should be a minimum deposit of 25k on a account (as per US federal rules and as per DD's statement above).
That's changes everithing although i understand that such a rule does not apply to cash accounts. Guess what, a very kind customer rep from IB just told me this :)
So maybe you are right, 5k is not practically enough to day trade. I wonder if it's worth doing it on a cash account with 10k and whether such a rule applies to canadian traders too when operating through IB on the US market
Last edited by j3j3 on 14 Jul 2011 19:05, edited 2 times in total.
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Re: Interactive Brokers

Post by newguy »

Let me know what you find, especially if they have registered accounts and an API. I'm still waiting for a review of TD/ToS

newguy

add: I remember looking up what dd said about no daytrading in a cash account and there is some rule about free riding which prohibits this. I've never not had a margin account but you can do this in a rrsp in Canada. http://www.sec.gov/investor/alerts/cashaccounts.pdf

Too many rules, just trade futures :!:
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Re: Interactive Brokers

Post by j3j3 »

Exactly! In fact that changes a lot to me.
BTW, eToro seems good for forex but i do not understand their pricing for stocks (if you do please advise), will have to call them tomorrow i guess.
DD knows a lot, i can see that now, but i must find a way.
What do you mean that you can daytrade from a RRSP? isn't that just a tax free account for retirement plans?
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newguy
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Re: Interactive Brokers

Post by newguy »

If you're really looking around then elitetrader.com will have lots of info, can't vouch for accuracy.

http://www.elitetrader.com/br/

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newguy
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Re: Interactive Brokers

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j3j3 wrote:What do you mean that you can daytrade from a RRSP? isn't that just a tax free account for retirement plans?
I mean there's no freeriding rule.

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Re: Interactive Brokers

Post by j3j3 »

newguy wrote:
j3j3 wrote:What do you mean that you can daytrade from a RRSP? isn't that just a tax free account for retirement plans?
I mean there's no freeriding rule.

newguy
can you daytrade from a canadian rrsp without putting there 25k?
does that mean u need to daytrade from a bank that offers rrsp (TD for example) or can you open a rrsp also within a (canadian?) online broker?
Cause if the only way to freeride in canada is through an rrsp and there's no canadian broker offering them then it means going to a bank and TD asks for 9.99 per trade.
But TD for example, i know because i called them, lets you trade from a TD Waterhouse account, at least they never mentioned to me such a possibility
Last edited by j3j3 on 14 Jul 2011 19:50, edited 1 time in total.
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