SIPP Product at Interactive Brokers

This is a discussion on SIPP Product at Interactive Brokers within the Brokerages forums, part of the Commercial category; Originally Posted by Interactive Brokers Our SIPP Services include: - Direct Market Access to over 80 global exchanges (i.e., we ...

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Old Jan 8, 2010, 8:02pm   #71
Joined Jun 2008
Re: SIPP Product at Interactive Brokers

Quote:
Originally Posted by Interactive Brokers View Post
Our SIPP Services include:
- Direct Market Access to over 80 global exchanges (i.e., we do not increase the spread or trade against you).
- Multi asset classes (trade stocks, options, futures and etc).
- Account protection =$30 million.
- Use any of our award winning trading platforms (at no extra cost) Webtrade, Traderworkstation, Mobile trader.
- Low costs (voted the lowest cost broker by Barrons for five years) e.g., US shares $0.005 per share all in, US options =< $0.70 per contract and etc.
- Free paper trading account.
- Real-time or delayed market data.
- Smart Order Routing (see how we compare to our competitors http://www.interactivebrokers.com/en...&ib_entity=llc
- We pay interest on funds on deposit.
- We are FSA regulated.
- We have been in business for over 32 years.
- Our Groups market capitalization if $4.8 billion.

We realise we may not meet the needs of all of our prospects. Hence, we encourage you to compare us. Regardless who you choose, we wish you well!
As valid as your claims may be it remains a conundrum to me why a behemoth of the financial services industry is unable to compete with it's smaller contemporaries on the basis of providing a margin account in it's SIPP structure. After all it is a universal account option.

Your cash account model with a little modification would be suitable for ISA investors, do you have any future plans to bring your company into the 21st century by embracing these tax efficient dinosaurs?

A belated... happy new year BTW.
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Old Jan 8, 2010, 8:59pm   #72
Joined Jan 2006
Re: SIPP Product at Interactive Brokers

Our reason is simple as to why we only offer SIPP beneficiary accounts to trade in a cash account because after polling various SIPP Administrators, 9 out of 10 did not want the SIPP beneficiaries to trade in a margin account. Why? Because SIPP beneficiary accounts are prohibited from losing more than the funds in the account and it was the responsibility of the SIPP Administrator to oversee the aforementioned. Trading on margin carries risk and may result in the account losing more then what is in the account. After carefully considering this point we only offer SIPP Administrators in a cash account. Please if you know of any SIPP Administrator that will accept the risks of allowing their clients to trade in a margin account e.g., stocks and etc, we would appreciate you informing them to contact our London office 020 7 776 7800. Maybe in the future if we can attract enough SIPP Administrators that accept their beneficiaries to trade multi asset classes in a margin account, we may be able to provide both our IB Universal and cash account to all SIPP beneficiaries (via their SIPP Administrators).
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Interactive Brokers

Last edited by Interactive Brokers; Jan 8, 2010 at 9:27pm. Reason: Typo
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Old Jan 8, 2010, 10:22pm   #73
Joined Jun 2008
Re: SIPP Product at Interactive Brokers

Quote:
Originally Posted by Interactive Brokers View Post
Our reason was simple as to why we only offer SIPP beneficiary accounts to trade in a cash account because after polling various SIPP Administrators, 9 out of 10 did not want the SIPP beneficiaries to trade in a margin account. Why? Because SIPP beneficiary accounts are prohibited from losing more than the funds in the account and it was the responsibility of the SIPP Administrator to oversee the aforementioned. Trading in margin carries risk and may result in the account losing more then what is in the account. After carefully considering this point we only offer SIPP Administrators in a cash account. Please if you know of any SIPP Administrator that will accept the risks of allowing their clients to trade in a margin account e.g., stocks and etc, we would appreciate you informing them to contact our London office 020 7 776 7800. Maybe in the future if we can attract enough SIPP Administrators that accept their beneficiaries to trade multi asset classes in a margin account, we may be able to provide both our IB Universal and cash account to all SIPP beneficiaries (via their SIPP Administrators).
Thank you for the explanation.

As you will be aware from my previous posts European Pensions Management Ltd allow their SIPP clients to trade in a margin account through Moneycorp Markets. Unless you were not an employee of IB or worked in a different department since Decemember 2005 or you have not read the original post in this thread you will also be aware that there was some sort of negotiations going on between IB and EPML with regard to a SIPP partnership.

Owing to the dangers of trading on margin as you expressed above I would imagine a SIPP administrator of the calibre of EPML would want to satisfy themselves that their prospective SIPP partners have suitable systems in place both from a technological and human perspective to eliminate any risk. I understand the negotiations/talks eventually broke down.

From the first post in this thread dated December 20th 2005:

Quote:
No they don't have one yet.

I have had conversations with a SIPP Trustee/Administrator www.epml.co.uk who have been trying to get IB to move forward with SIPPs. I am starting this thread to see if others would be interested in trading through IB within a SIPP. If several people are interested we can point this out to IB in the hope that the business opportunity it presents will lead them to move forward more quickly.

If it was done through epml the SIPP would allow a very wide range of products including Equities, Futures and Options on Stocks and Futures. If anyone wants more information on the SIPP fees etc. it would be classed as the empl "bespoke SIPP" product, details of which are on their site.

So if anyone is potentially interested in trading through a SIPP vehicle soon or in the future please respond to this thread.

Regards,


Gareth
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Old Jan 19, 2010, 4:36pm   #74
Joined Jan 2006
Re: SIPP Product at Interactive Brokers

So how exactly is trading futures NOT trading on margin?

Personally, I am not bothered about leverage but the inability to short stocks is a bummer.
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Old Mar 4, 2010, 12:14pm   #75
Joined Aug 2002
Re: SIPP Product at Interactive Brokers

After some six months now since IB started to offer a SIPP account, it is good to see that the list of approved SIPP administrators is slowly growing, there are now 5 on the list at the time of posting:

http://www.interactivebrokers.com/en...ib_entity=inst

Unfortunately though not the one I use, IPS Partnership. The last I got from them was this comment:

>I’m afraid we are having problems getting Interactive Brokers to agree to set up accounts in the way we need them to operate. One of our Business Development Managers is currently awaiting a call from Interactive Brokers to discuss this matter further. Until this is resolved, I’m afraid you will not be able to set up an account with them through the SIPP.

I emailed Gerald Perez at IB about what's going on here a couple of weeks ago but did not get a reply. Is anyone else using IPS and would like to trade through IB, or can anyone shed any light on this?

KenN
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Old Mar 4, 2010, 1:33pm   #76
Joined Jan 2006
Re: SIPP Product at Interactive Brokers

For your reference, we require all SIPP Administrators to affirm all banking instructions (in and out) of a SIPP sub account. This is a secure 2 minute process and all online.

IPS cordially objects to the above as they find it an extra step that they are not prepared to do for any account that trades through us. We implemented such a step because (but not limited to) the SIPP Admininstrator's role is to oversee funding in and out of each respective SIPP. Hence our online process ensures all of SIPP Administrators have oversight and control of all funding in and out of each respective account.
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Old Mar 4, 2010, 2:41pm   #77
Joined Aug 2002
Re: SIPP Product at Interactive Brokers

Many thanks for the prompt reply and explanation, I will challenge them on this.

Ken
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