Australian (ASX) Stock Market Forum

Interactive Brokers

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joeno said:
Hi guys I've been buying some US stocks lately. Noticed there is a $2USD FOREX fee for each buy (in addition to commissions).

I tried to convert AUD to USD in bulk to avoid this repeated cost. However when I try to buy the USD in the FOREX section it says Australian law no longer allows this???

Can someone let me know if this is the case? Or perhaps I haven't followed the right steps. This additional fee is really annoying for small ST trades.
Click to expand...

Do you have a cash account or Reg-T? You can't convert funds like you said if you have a cash account. I believe if you buy US stock with AUD like you said you are they will do the FX conversion (the $2 fee) but when you sell the stock I think your funds will be in USD, you can then convert the USD > AUD via a FX transaction . The Comms would still be cheaper than in AUS probably, but it is a pain
 
Roller_1 said:
Do you have a cash account or Reg-T? You can't convert funds like you said if you have a cash account. I believe if you buy US stock with AUD like you said you are they will do the FX conversion (the $2 fee) but when you sell the stock I think your funds will be in USD, you can then convert the USD > AUD via a FX transaction . The Comms would still be cheaper than in AUS probably, but it is a pain
Click to expand...

Thanks for the confirm. Guess I'll have to cop it then. Thought i could make small <1k trades because of the $1 commissions for US stocks but this makes it a lot more expensive.
 
Example:

Let's say I have a $100,000 account.

I am interested in buying XYZ. It closed at $10 today. I want to buy $10,000 of XYZ at limit $9.80 tomorrow.

I place a limit order to buy at $9.80 with the condition to trigger if the price falls to $9.90 first.

Will IB reserve the capital on this order type if it is not triggered? i.e. as soon as I place the order will my "available funds" be $90,000 or still $100,000?

Cheers
 
rb250660 said:
Example:

Let's say I have a $100,000 account.

I am interested in buying XYZ. It closed at $10 today. I want to buy $10,000 of XYZ at limit $9.80 tomorrow.

I place a limit order to buy at $9.80 with the condition to trigger if the price falls to $9.90 first.

Will IB reserve the capital on this order type if it is not triggered? i.e. as soon as I place the order will my "available funds" be $90,000 or still $100,000?

Cheers
Click to expand...

Short answer is no, if you have a cash balance you could place as many orders as you like and your available funds will be 100k.

But price will have to touch your LMT order to trigger... unless it gaps down on the open.
 
joeno said:
Thanks for the confirm. Guess I'll have to cop it then. Thought i could make small <1k trades because of the $1 commissions for US stocks but this makes it a lot more expensive.
Click to expand...

What I did to get around this limitation is to buy say $10k of stock and wait for the margin call, which will then automatically convert your AUD to USD. Once that happens you can sell the stock and the money will returned to you as USD. I've done this twice, the 1st time it took 12 minutes for the margin call to happen, the 2nd time it only took a minute to happen. Note that you'll have to wait 3 days for the funds to clear before you can use the USD to buy US stocks.
 
OhBlah said:
What I did to get around this limitation is to buy say $10k of stock and wait for the margin call, which will then automatically convert your AUD to USD. Once that happens you can sell the stock and the money will returned to you as USD. I've done this twice, the 1st time it took 12 minutes for the margin call to happen, the 2nd time it only took a minute to happen. Note that you'll have to wait 3 days for the funds to clear before you can use the USD to buy US stocks.
Click to expand...


well thats a different way to do things!:eek::D
 
joeno said:
Thanks for the confirm. Guess I'll have to cop it then. Thought i could make small <1k trades because of the $1 commissions for US stocks but this makes it a lot more expensive.
Click to expand...

your first few trades might have a bit higher commissions but once your funds are in USD it will only be $1. But then you will have currency risk too

What I did to get around this limitation is to buy say $10k of stock and wait for the margin call, which will then automatically convert your AUD to USD. Once that happens you can sell the stock and the money will returned to you as USD. I've done this twice, the 1st time it took 12 minutes for the margin call to happen, the 2nd time it only took a minute to happen. Note that you'll have to wait 3 days for the funds to clear before you can use the USD to buy US stocks.
Click to expand...

Good luck with that :xyxthumbs
 
Belikewater said:
hey I've recently went to short a stock with IB on the US markets and been hit with message saying this account cannot hold a short position, looking at this https://www.interactivebrokers.com/en/index.php?f=am_stockshorting&p=overview2
does this mean aussies cant short stocks?
Click to expand...

Welcome to the club named "pissed/ annoyed off IB customers Down under", Interactive brokers makes it difficult to Australian traders and you can't get any logical answers why so ? from the customer service the customer service is just like a robot

They blame ASIC which is stupid if other brokers from US can get their act together in Australia why IB can't do it is beyond any logic.
 
mjim said:
They blame ASIC which is stupid if other brokers from US can get their act together in Australia why IB can't do it is beyond any logic.
Click to expand...

Which other US broker offers equities/opts/futures & FX to Australian customers ? Only one I can think of is Thinkorswim - and they pulled all their Australian operations (probably because of ASIC). Please let me know the alternatives, I do need a back up.
 
HAs anyone seen or know where I can generate a report of dividends that also shows franking credits?

I asked the friendly IB online chat - but they have no knowledge of what franking credits are. It would make it much easier for my accountant if I could give him a EOFY statement that also included the franking credits (if any) of dividends.
 
RazzaDazzla said:
HAs anyone seen or know where I can generate a report of dividends that also shows franking credits?

I asked the friendly IB online chat - but they have no knowledge of what franking credits are. It would make it much easier for my accountant if I could give him a EOFY statement that also included the franking credits (if any) of dividends.
Click to expand...

See page 83, post #1653 & #1654 if that is what you are after.

https://www.aussiestockforums.com/forums/showthread.php?t=10838&page=83
 
Just wondering since IB practically gives zero interest on cash in account.

Is there any share, bond, or other product I can buy in IB which will give a relatively low risk regular yield/interest?

Does this make sense? Perhaps something like a low risk bond which has a steady capital appreciation as it moves towards maturity. Are there any options/recommendations, or just sit in cash.
 
Re. Franking Credits - I still can't see info re. Franking Credits / Tax Withheld on an EOFY IB statement.

How can I find this information out without manually digging up the info?

There's a "Change In Dividend Accruals" table in the FY statement - it has columsn such as:
Date, Pay Date, Quantity, Tax, Fee, Gross Amt, Net Amt etc.

However....

Using WBC as an example, which is fully franked, there's no info in the report which indicates that there was already tax paid out of the dividend.

Surely this info must be in the report somewhere, but I'll be jiggered if I can find it.
 
RazzaDazzla said:
Re. Franking Credits - I still can't see info re. Franking Credits / Tax Withheld on an EOFY IB statement.

How can I find this information out without manually digging up the info?

There's a "Change In Dividend Accruals" table in the FY statement - it has columsn such as:
Date, Pay Date, Quantity, Tax, Fee, Gross Amt, Net Amt etc.

However....

Using WBC as an example, which is fully franked, there's no info in the report which indicates that there was already tax paid out of the dividend.

Surely this info must be in the report somewhere, but I'll be jiggered if I can find it.
Click to expand...

You will not find it in the EOY activity statement. It is a separate report that comes out about 2 weeks after year end.

Select Reports - Tax - Tax Forms - Dividend Report then pick 2016. For some reason 2016 isn't showing right now, even though I downloaded it a few weeks ago. Maybe because it's Sunday night, maintenance may be in progress. This is what the report shows:

Screen Shot 2016-08-07 at 7.30.10 PM.png

I actually found an error in mine. You may want to check what the report says against what is reported on several websites (they show you the franking percentage) and knowing your dividend amount, you can work out the franking credit if you know the percentage.

One site that gives it is www.asx.com.au and another is: http://www.sharedividends.com.au/viewStory/Dividend+History

Let's say the total dividend amount is D = Number of Shares * dividend per share
and the franking percentage is F%

Then Franked amount is D * F
Unfranked amount is D - (D * F)
Franking Credit is D * F * 3/7

For example, you have 1000 shares that paid a $1 dividend that was franked 40%

Franked Amount is $1000 * 40% or $400
Unfranked Amount is $1000 - $400 = $600
Franking Credit is $400 * 3/7 = $171.43

Sorry if you already know these formula, but just in case.
 
calky360 said:
Just wondering since IB practically gives zero interest on cash in account.

Is there any share, bond, or other product I can buy in IB which will give a relatively low risk regular yield/interest?

Does this make sense? Perhaps something like a low risk bond which has a steady capital appreciation as it moves towards maturity. Are there any options/recommendations, or just sit in cash.
Click to expand...

look at bank hybrids - good yield - I have NABHA, NABPB etc.
 

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