stevio
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Post by stevio on Mar 31, 2019 15:27:34 GMT
Long story, I am considering moving my trading to Interactive Brokers
To avoid an inactivity fee, I need to retain a certain equity balance or trade frequently. I dont think I can meet that balance with my trading balance alone and I am considering topping it up with my cash reserve
I realise the inactivity fee is a small cost and not a reason to change an investment strategy (if I even had one to start with!)
I was considering swapping my cash reserve for a bond reserve. The trading fees are minimal, so I think I can sell off bonds as cash is needed
What could be the pros and cons of this approach?
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Post by gravitykillz on Apr 2, 2019 14:41:57 GMT
Wise alpha
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bigfoot12
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Post by bigfoot12 on Apr 2, 2019 23:46:01 GMT
What could be the pros and cons of this approach? I don't think that it will be, but any choice of broker might be the next MF Global, Lehman,.... You might get your money back in the end, but could you cope in the interim? I would have thought it wise to have some cash. You don't mention which bonds, if they are short dated gilts, they are likely to be okay, as they would be with short dated, German, Swiss, Japanese, US bonds, but with the commensurate currency risk (which might be an advantage). You do seem to be letting the tail way the dog. Decide what you want to do and then pick the best platform for that. If you don't trade much there might be a cheaper platform for you. Even Hargreaves Lansdown, which many on this platform don't like because it has high fees, (even though I think that you get what you pay for when you want to phone someone) has no annual inactivity fees for shares and gilts, held outside wrappers, and they are capped at £45 per year inside an ISA - they are higher for funds.
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stevio
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Post by stevio on Apr 3, 2019 6:27:44 GMT
What could be the pros and cons of this approach? I don't think that it will be, but any choice of broker might be the next MF Global, Lehman,.... You might get your money back in the end, but could you cope in the interim? I would have thought it wise to have some cash. You don't mention which bonds, if they are short dated gilts, they are likely to be okay, as they would be with short dated, German, Swiss, Japanese, US bonds, but with the commensurate currency risk (which might be an advantage). You do seem to be letting the tail way the dog. Decide what you want to do and then pick the best platform for that. If you don't trade much there might be a cheaper platform for you. Even Hargreaves Lansdown, which many on this platform don't like because it has high fees, (even though I think that you get what you pay for when you want to phone someone) has no annual inactivity fees for shares and gilts, held outside wrappers, and they are capped at £45 per year inside an ISA - they are higher for funds. Thanks bigfoot12The fees for trading US shares are as low as $1, so although I can stick with buy and hold with index trackers for the bulk of my portfolio, I can experiment with shorter term trading for a small part of my portfolio elsewhere Also it seems US domiciled ETFs are also available, with lower TER and potential to claim back withholding tax The fees with IB are $10/month (minus trading costs), so maybe double H&L per year. This is waived for larger portfolios, hence why I am considering putting my cash reserve into bonds (or bond funds/ETFs). I currently have no bonds at all in my portfolio
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james100
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Post by james100 on May 15, 2019 20:54:58 GMT
Hi stevio, I agree with much of what's already been said, but main point to set your overall investment strategy and use that to direct decisions. I'm currently in a low volatility position and care more about not losing money than making money over the coming 12-18 m (negative about Brexit, spectre of JC etc, may want/need to move abroad again etc). Cash, government bonds and gold all feature in addition to equities and GBP v non-GBP is a key issue for me. Holding both cash and bonds offer balance of liquidity, stability and mobility I want within the context of portfolio for now. Specifically, my cash is divided GBP, USD, AUD, EUROS and bonds divided IGLS (Gilts 0-5y) and SAAA (AAA-AA Govt Bond 0-20+y, split about 50% Euro, 20% USD and of the rest, <10% GBP). |
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IFISAcava
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Post by IFISAcava on May 15, 2019 23:01:42 GMT
Hi stevio , I agree with much of what's already been said, but main point to set your overall investment strategy and use that to direct decisions. I'm currently in a low volatility position and care more about not losing money than making money over the coming 12-18 m (negative about Brexit, spectre of JC etc, may want/need to move abroad again etc). Cash, government bonds and gold all feature in addition to equities and GBP v non-GBP is a key issue for me. Holding both cash and bonds offer balance of liquidity, stability and mobility I want within the context of portfolio for now. Specifically, my cash is divided GBP, USD, AUD, EUROS and bonds divided IGLS (Gilts 0-5y) and SAAA (AAA-AA Govt Bond 0-20+y, split about 50% Euro, 20% USD and of the rest, <10% GBP). what's the best way to hold gold, in your experience?
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james100
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Post by james100 on May 16, 2019 9:59:41 GMT
Hi stevio , I agree with much of what's already been said, but main point to set your overall investment strategy and use that to direct decisions. I'm currently in a low volatility position and care more about not losing money than making money over the coming 12-18 m (negative about Brexit, spectre of JC etc, may want/need to move abroad again etc). Cash, government bonds and gold all feature in addition to equities and GBP v non-GBP is a key issue for me. Holding both cash and bonds offer balance of liquidity, stability and mobility I want within the context of portfolio for now. Specifically, my cash is divided GBP, USD, AUD, EUROS and bonds divided IGLS (Gilts 0-5y) and SAAA (AAA-AA Govt Bond 0-20+y, split about 50% Euro, 20% USD and of the rest, <10% GBP). what's the best way to hold gold, in your experience? Links to an old post and thread on this...in answer to your question, it would depend on the amount you want to hold and why. For me, with my specific purpose and in the context mentioned above, it's in a physical replication ETF (SGLN) which I deliberately hold offshore. Absolutely agree with the thrust of wallstreet's post regarding gold's fitness for inclusion in a portfolio and inappropriate powers of seduction. But for some - and that includes me - it is a useful component...for now. Here are a couple of articles which give background: www.ftadviser.com/investments/2017/08/24/how-can-gold-fit-into-a-portfolio/seekingalpha.com/article/3317905-golds-failure-as-portfolio-stabilizer
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james100
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Post by james100 on May 16, 2019 10:46:11 GMT
Long story, I am considering moving my trading to Interactive Brokers To avoid an inactivity fee, I need to retain a certain equity balance or trade frequently. I dont think I can meet that balance with my trading balance alone and I am considering topping it up with my cash reserve I realise the inactivity fee is a small cost and not a reason to change an investment strategy (if I even had one to start with!) I was considering swapping my cash reserve for a bond reserve. The trading fees are minimal, so I think I can sell off bonds as cash is needed What could be the pros and cons of this approach? Just a thought...does interactive brokers permit you to make cash withdrawals on the back of a margin loan? I have this option and although I don't use it, if you want to have a quick credit facility for occasional purposes without needing to liquidate then it can be worth investigating.
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james100
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Post by james100 on May 16, 2019 12:23:59 GMT
Just a thought...does interactive brokers permit you to make cash withdrawals on the back of a margin loan? I have this option and although I don't use it, if you want to have a quick credit facility for occasional purposes without needing to liquidate then it can be worth investigating.
Jeesus F.C. Christ .... please tell me you're not being serious ! 
Thankfully Interactive Brokers are risk averse. Cash is cash, either you have it or you don't on IB. You can't even withdraw forex before settlement occurs.
I am very greatful of Interactive Brokers being such a risk averse platform and preventing the few spoiling it for the many.
If you want cash on the back of a loan, use a credit card, use your overdraft or go see your bank manager for a proper loan. Don't abuse facilities that are not intended for it.
You're just setting yourself up for being very badly burnt indeed one day. When, not if, that day comes, don't come here looking for sympathy.
Whilst you're entitled to your opinion, this post seems a little over-enthusiastic. I'm simply referring to a rather standard product, generally marketed as a personal line of credit within international brokerages; my comment related to interactive brokers' existing margin loan policies. I wouldn't describe them as either risk averse or abusive personally, but of course the joy of participating in a forum such as this is the constructive and respectful exchange of experience...all wrapped up in good manners, of course 
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