sending money to IB

This is a discussion on sending money to IB within the Brokerages forums, part of the Commercial category; My account with IB is now open and I want to send funds to them. I am surprised to find ...

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Old Jul 21, 2003, 5:52pm   #1
 
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sending money to IB

My account with IB is now open and I want to send funds to them. I am surprised to find that they will not accept cheques. My base currency is GBP . I have to send the funds by CHAPS transfer for which my bank will charge £23. Is there any other way to transfer funds in order to avoid above charge. Thank for help and information.
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Old Jul 21, 2003, 5:55pm   #2
 
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I bank on the internet (Natwest) and just set up IB's payment details and sent it, no charge.
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Old Jul 21, 2003, 5:57pm   #3
 
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Hi Osho,

Not that I know of. My bank charges £20 per transfer but considering the capital you need to trade with its a very minor irritant.

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Old Jul 21, 2003, 6:11pm   #4
 
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All banks can send it via electronic transfer, which takes three days, and there is no charge for this. So if you send it Tuesday it will arrive at IB's UK bank to clear at close on Thursday, and I would expect funds to be in your account ready to trade with on Friday late afternoon at the latest.

Remember that you are sending it to the UK bank which notifies the UK IB office, which in turn notifies the US IB office, which credits your account. So do bear in mind the 5 hour time difference between UK and US, and the number of processes it has to go through. IB's US office opens at 2:00pm UK time, so therefore it will take them an hour or two to go through all the credits which have arrived, hence you might not have credited to your account until 5:00pm UK time.

Just make sure that you complete the online funds deposit notification form, and check with your bank the cut-off time for transferring funds by this method. Mine is 18:00 UK time, but the deadline for CHAPS (£18 fee) is 14:30 for same-day transfer.
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Old Jul 21, 2003, 6:34pm   #5
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My base currency with IB is GBP, can somebody offer any advice whether I should have chose USD instead..

TIA.
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Old Jul 21, 2003, 6:44pm   #6
 
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Depends on how affected you will be by the GBP / USD exchange rate fluctuations, and how often you intend a) depositing, and b) withdrawing funds.
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Old Jul 21, 2003, 7:25pm   #7
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Boy,

Your base currency is unimportant. If you think that the £ is going to go down against the $, as it has by nearly 9c in the last few weeks, then you can buy a number of dollars which are held in your IB account. Last week I bought 30,000 dollars so if the £ drops even further my account will still have the same number of dollars I bought last week + any successful trades I have made.

Make sure that you set it up with the "underlying" as "USD" as I made a mistake to start with.

When you want to draw money from your account you just sell a number of dollars back to your base currency and withdraw funds as normal.

This is without doubt the cheapest way to hedge against the falling pound. Of course you will lose out if the pound rises but for me I wanted to be sure that I will always meet the PDT funding requirements without worry of exchange rates.

Cheers


Paul
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Old Jul 21, 2003, 7:30pm   #8
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Paul, can you explain more about 'underlying' I cant rember that bit, all it asked was 'choose the base currency'

thanks for help.
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Old Jul 21, 2003, 8:13pm   #9
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Boy,

Look at the attached picture and you will see that under the heading "Underlying" it says "USD" so you would type in "USD" to an empty line. You will then get an option list select "Cash" and then another option which you select as "GBP"
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Old Jul 21, 2003, 8:15pm   #10
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Now when you want to buy some dollars you click on "Ask" and type in how many you want to buy as shown in the next image. Make sure that "Prem" is GBP as shown. When you want to convert dollars back you click on "Sell" and type in how many dollars you want to sell back. In my view it is very good.

I hope this helps


Cheers


Paul
Attached Thumbnails
ib2.jpg  

Last edited by Trader333; Jul 21, 2003 at 8:24pm.
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