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[amibroker] Re: OT: Initial Margin, Maintenance Margin

  • Date: Fri, 29 Jan 2010 15:42:17 -0000
  • From: "reefbreak_sd" <reefbreak_sd@xxxxxxxxx>
  • Subject: [amibroker] Re: OT: Initial Margin, Maintenance Margin

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It is important to note that what you are actually doing is taking a $54,500 position (1090 * 50 = 54500) the $2250 margin is just a 4% down payment.  You are responsible for the full amount (higher or lower) when you eventually close the position.  If you decide to hold overnight, the margin is doubled. 

Most (all?) trading systems have periods where many trades in a row go against you.  I'd recommend $25000 MINIMUM in your account to trade one EMini $50000 is better.  Finally, even if you are successful, your largest drawdown is in the future.



--- In amibroker@xxxxxxxxxxxxxxx, James <jamesmemphis@xxx> wrote:
>
> To place the initial trade, you must have 2813 in initial cash. After the trade is placed, 2250 is resevered to maintain the position above the unrealized P/L. However, you can't do anything if your account balance is below $3000 with IB, nor should you because the risk of ruin is probably 100%.
> 
> 
> 
> 
> ________________________________
> From: Edward Pottasch <empottasch@xxx>
> To: amibroker@xxxxxxxxxxxxxxx
> Sent: Fri, January 29, 2010 3:42:51 AM
> Subject: [amibroker] OT: Initial Margin, Maintenance Margin
> 
>   
> hi,
>  
> I was reading about how much cash you need on your account before auto liquidation kicks in at Interactive Brokers when daytrading futures
>  
> For instance for ES the Initial Margin  is 2813, the maintenance Margin is 2250. From the example they give on their site (see below) I understand that you need at least Initial Margin + Maintenance margin. However, from wikipedia I understand that one only needs the initial margin and if your account drops below the maintenance margin it will liquidate the position. So does anybody know how it works? I can open 1 position ES with 2813$ on my account and it will close this position automatically if the price drops below 2250$?
>  
> thanks, Ed
>  
>  
>  
> http://www.interact ivebrokers. com/en/p. php?f=margin
>  
> Example: Commodities Margin Example
> The following table shows an example of a typical sequence of trading events involving commodities and how they affect a Reg T Margin Account. Although our Universal Account automatically transfers funds between the securities and commodities segments of the account, to simplify the following example, we will assume that the cash in the account remains in the Commodities segment of the account.
> Action
> Change in Cash
> Resulting Net Liquidation Value
> 1. Deposit $10,000.00 + $10,000.00 $10,000.00 
> 2 Buy 1 ES Futures Contract ($2,813.00) $7,187.00 
> $850.00 * 50 (multiplier)
> ES Initial Margin Requirement = $2,813.00 
> 3. End of Day: ESprice goes to $860.00 +$500.00 $7,687.00 
> Gained $10.00 * 50 = $500.00
> ES Overnight Maintenance Requirement = $4,500.00 
> Net Liquidation Value > $4,500.00 No Liquidation. 
> 4. Next End of Day: ES price drops to $800.00 ($3,000.00) $4,687.00 
> Lost $60.00 * 50 = $3,000.00 
> Net Liquidation Value > $4,500.00 No Liquidation. 
> 5. Next End of Day: ES price drops to $785.00 ($750.00) $3,387.00 
> Lost $15.00 * 50 = $750.00 
> Net Liquidation Value < $4,500.00 Liquidation occurs.
>




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