IB and interest charge

[osho67]

I have tried to look IB front page to find out the answer why IB charges me interest every month. I buy some shares and there is enough money to cover the purchase . Is this because IB only debits margin to my account leaving me more money to buy some other shares. I would not like to pay interest to IB and I would prefer my a/c is fully debited with the purchase of the equity.Please comment and help. Thanks

 

[TheBramble]

Are you shorting stocks as well? If you are and are holding, you'll be charged the interest on 'borrowing' those stocks.

 

[Trader333]

Email them and ask why ?


Paul

 

[JonnyT]

I'm still awaiting a reply to trades being lost on Globex from two weeks ago so I wouldn't hold your breath.

Seriously considering moving to Tradestation 7.2

JonnyT

 

[osho67]

I am not shorting stocks. I buy 100 of stock and write a call option against those stocks. I have not done any other activity.

 

[wheezergeezer]

Who is better IB or Tradestation, I ask because I want to open an account and trade in the US, as you guys are far more experienced that me, I would appreciate your views , or am I splitting hairs.............thanks

 

[osho67]

I have noticed IB is not deducting full value of my purchases. I am only being debited margin amount and more funds are at my disposal to spend. Is this because this is a margin account as opposed to a cash account?This will explain the interest charge.

 

[rog1111]

I have tried to look IB front page to find out the answer why IB charges me interest every month. I buy some shares and there is enough money to cover the purchase . Is this because IB only debits margin to my account leaving me more money to buy some other shares. I would not like to pay interest to IB and I would prefer my a/c is fully debited with the purchase of the equity.Please comment and help. Thanks

osho, for IB problems, I usually try the IB website's "Live help" person first, often much quicker then emailing, as usually (but not always) they're quite clued up.
GL

rog1111

 

[sidinuk]

Is your base currency GBP but you are buying US shares? If so, everytime you deal the margin will be deducted from what ever US$ you have in your account, if there aren't enough then you will effectively be overdrawn in US$ even though you have enough GBP to cover the margin.

 

[osho67]

Yes my account is GBP account and I donot have any $ balance( I have only remitted GBP)I have ssen my buying has exceeded the amount I have sent to them and still I have available funds at my disposal as IB is only deducting margin and not full value. So in effect I am overdrawn and I am being charged interest.

 

[idetkov]

That is how it works. You are borrowing $ from IB to buy US stocks.

 

[idetkov]

Sorry, I forgot to mention that alternatively you can buy USD from IB and remove your interest charges. Of course, you will start to depend on GBP/USD rate in this case.

 

[peto]

If idetkov and sidnuk are right then you could buy dollars on their own 'IDEAL' exchange and presumably solve the problem. I have a GBP account but my account shows separate balances for all the currencies I have traded in