Interactive Broker Notice: Change to Risk MGMT & Margin Policies

[SmallForces 2]

On Interactive Brokers, did anyone else get this email message today (further below) or just me?

Also wondering: Is it bad that I don't know what most of this means, haha, for real though? I work hard on trading, with little time left for learning all the embedded outside nuances. I do plan at some point knowing everything, ambitious, right?!?!  

This is where being part of a community and being candid will benefit us all. Seeking wisdom here on what this all means.

Thanks in advance, -Matt aka SmallForces

"Dear Client,

In response to extreme market volatility and substantially increased risk sentiment in global markets, we are taking the following steps with immediate effect:

1. Intraday margin discounts remain suspended until further notice.

2. Liquidation deferrals: the buffer for activation of liquidations is currently 5%, but may be reduced further as market conditions warrant [Background: under normal market conditions IBKR usually delays liquidations for a period of time during the active trading session when an account is only slightly (less than 10%) under its financial requirements to allow clients to individually manage their risk reduction activities].

3. We will be deploying re-assessments of margin requirements more frequently and in some cases, on an intraday basis. Clients with positions having exposure to large moves in most asset classes (equity, energies, capital markets, forex, bonds) may expect higher capital requirements on short notice and should consider managing their risk and capital positions in their accounts to anticipate such changes.
 
-Interactive Brokers Client Services"

[Justin 262]

It doesn't look like any of these will have much impact on people who use IB here in the community.

1. Sounds like any margin loan discount you may receive for having a larger account wont be given anymore.
2. If they need to liquidate your account because you've blown up your account, they usually give a % buffer before doing so. They are reducing this buffer for now.
3. If your risk is very high in whatever asset you are trading, they may require you to have more equity to get margin.

I don't think any of these will have an impact on the small accounts that 99.9% of BBT members have. Even an account like Andrew's most probably.

[SmallForces 2]

Great feedback Justin, makes total sense. I appreciate it...

I'm for sure in that 99.9% small account bracket.