Is Interactive Brokers (IBKR) Safe in this Banking Crisis?
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- Опубликовано: 23 июл 2024
- Is IBKR still a safe place for your money? I find out. 🔴 𝗦𝘁𝗮𝗿𝘁 𝗜𝗻𝘃𝗲𝘀𝘁𝗶𝗻𝗴 𝘄𝗶𝘁𝗵 𝗜𝗕𝗞𝗥 ➡️ www.interactivebrokers.com/mk...
🔴 𝗦𝘁𝗮𝗿𝘁 𝗜𝗻𝘃𝗲𝘀𝘁𝗶𝗻𝗴 𝘄𝗶𝘁𝗵 𝗜𝗕𝗞𝗥 ➡️ www.interactivebrokers.com/mk...
⬇️ Timestamps:
0:00 → Introduction
0:56 → Key Business Metrics
2:48 → Profit & Loss
4:27 → Balance Sheet
7:43 → Are they SIPC/ FSCS protected?
9:39 → Conclusion
The ongoing banking crisis has left many investors concerned about the safety and stability of their financial institutions. The turmoil has ratcheted up fears of a contagion and prompted action from the U.S. Federal Reserve, U.S. Treasury and the private sector.
With banks facing increasing pressure due to economic uncertainty, rising debt levels, and low-interest rates, it's more important than ever to be well-informed about the financial institutions we trust with our hard-earned money.
So what better way than to find out about this than to analyze their financials?
In this video, I do a deep-dive on their key business metrics (number of customer accounts and revenue from customer trades), income statement, balance sheet and more importantly, if they are protected by financial authorities in case they were to go bust.
Watch the video to find out more!
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Disclaimer: This content is provided by a paid Influencer of Interactive Brokers. Influencer is not employed by, partnered with, or otherwise affiliated with Interactive Brokers in any additional fashion. This content represents the opinions of Influencer, which are not necessarily shared by Interactive Brokers. The experiences of the Influencer may not be representative of other customers, and nothing within this content is a guarantee of future performance or success.
None of the information contained herein constitutes a recommendation, promotion, offer, or solicitation of an offer by Interactive Brokers to buy, sell or hold any security, financial product or instrument or to engage in any specific investment strategy. Investment involves risks. Investors should obtain their own independent financial advice and understand the risks associated with investment products and services before making investment decisions. Risk disclosure statements can be found on the Interactive Brokers website.
Interactive Brokers is a FINRA registered broker and SIPC member, as well as a National Futures Association registered Futures Commission Merchant. Interactive Brokers provides execution and clearing services to its customers. For more information regarding Interactive Brokers or any Interactive Brokers products or services referred to in this video, please visit www.interactivebrokers.com.
🔴 𝗦𝘁𝗮𝗿𝘁 𝗜𝗻𝘃𝗲𝘀𝘁𝗶𝗻𝗴 𝘄𝗶𝘁𝗵 𝗜𝗕𝗞𝗥 ➡️ www.interactivebrokers.com/mkt/?src=zietPY2&url=%2Fen%2Fwhyib%2Foverview.php%3Fnored%3Dt
If you found this video helpful, it would do our team a great pleasure if you can check out Interactive Brokers (with the link above), as we will receive a very tiny kick back - we promise to make more and higher quality videos for all of you ❤ Have a nice day ahead!
Super helpful! I'm glad you did this video and showed the financials like you did. Thank you!
Cheers buddy! Will be covering its latest earnings report so stay tuned to that!!
I was wondering this very question yesterday, your videos are awesome man
hehe so glad to know that! Thank you for your nice comment 🥰
Great video, thanks Ziet!
Cheers Marko! Stay tuned for the earnings analysis!!🥰
Interesting, I had a thought about it when SVB collapsed. I found the answer now 😊. Thanks Ziet
You're most welcome Kannan, and thank you so much for dropping by again!!
Hi Fong, can you simplify it to me a bit here. When we buy let's say CSPX via Ibkr, does it mean that the ownership of our stock is held by IBKR and a proxy of it is shown to us, or is it sort of registered in LSE directly by our name? If IBKR go bust, then how would LSE in this case reach out to everyone who bought shares via IBKR? Sorry my understanding might not be right.
Great contente. Very complete in its purpose. Sugestion: avoid backgound sound track music. It does not help at ALL, specially fot those that are ESL
noted, thank you!!
Agreed. Otherwise great video.
Good points bro
Cheers Daniel 😁
Nice video, thanks. if $500k is on cash in interactive broker, what is the guaranty on this amount ?
As IB is the only US broker who negociate Ireland domiciled ETF for non U.S. citizens and non EU residents in case of IB default how would transfer the ETFs if no other broker would accept? Thank you
Thank you
You're most welcome!
The insured bank deposit sweep program is not available now according to the customer service
Ah is it? Weird...It's still on the website: www.interactivebrokers.com/en/accounts/sweep-program.php#:~:text=Our%20Insured%20Bank%20Deposit%20Sweep%20Program%20allows%20eligible%20IBKR%20clients,cash%20held%20in%20IBKR%20accounts.
Hi Ziet, thank you for explanation on IBKR, i have a beginner question. You have mentioned that IBKR or if not most of the broker is a memeber of SIPC which covers max of $500k securities and cash.
My question is what if the investor have millions of dollar in IBKR securities and cash. Does that means that if IBKR close down, he/she is only able to get back compensation of up to $500k only?
Hi Lewis, you're right! SIPC protection covers up to $500K, including a $250K limit for cash. So, if an investor has millions, SIPC won't fully cover them in case of a broker's failure. However, this is a (very) rare case and some brokers also carry additional insurance to further protect clients (IBKR's Lloyd London insurance in this case). It's never wrong to diversify your holdings across multiple brokers to diversify the risk of such huge amount!
@@ZietInvests Hi Ziet, thank you so much for your response. I am curious of what about the ultra rich investor like having hundreds of millions invested in the stock market, will they be using like 500k for each broker? Means they will need to have 50 to 100 different broker in order to have maximum capital protection ?
Ziet, further to your SIPC comments - that page you display at 8:29 is a screenshot from the SIPC website. If you scroll down the page it says "SIPC protects cash in a brokerage firm account from the sale of or for the purchase of securities. Cash held in connection with a commodities trade is not protected by SIPC"
IB is currently offering attractive interest rates on USD Cash held in the trading account. But that SIPC condition (cash held from the sale of or for the purchase of securities) is tricky. Does it mean if you just deposit the cash but don't trade does that mean you aren't covered by the specific condition mentioned? And if you are a Commodities trader you might be misled into thinking you're covered, when according to that article you are not!
To be honest I am HIGHLY sceptical of all these 'insurances', whether SIPC or FDIC, because where does the money come from in the kind of economic implosion that would bring down a company like IBKR? In such a scenario there would be huge bank failures and market chaos across the globe. A kind of Doomsday scenario. I really don't think anyone will get their money back - except for the elites and super rich perhaps (look at the Credite Suisse collapse for hints).
Other company will acquire it
Your points are valid. SIPC protection primarily covers cash related to securities trading, not just cash deposits or commodities trades. If you're not trading securities, SIPC coverage might not apply.
In a global financial crisis, protections like SIPC aren't designed to cover systemic failure. But we have seen it during Lehman Brothers, other company will take over in case of solvency, so it is only a matter of time before clients' get back their assets.
amazing work Ziet, I´ve bought Ireland-based SP500 ETFs, this means that the insurance came from Ireland?
Hi Gustavo, your protection should be based on your IBKR entity (dont think funds have any form of protection)
Hi Ziet, sorry if this has been asked before , but if I buy US stocks using Interactive Brokers, is there a CDS-like account opened under my name so that all stocks are owned under my CDS-like account or does it work differently there? I would be concerned if the stocks I buy are owned by Interactive Brokers & i end up just being a creditor... Thanks for all your great content.
Hi CY, it works like a Direct CDS so rest assured you are holding the actual stock of the company, not a CFD contract kind of trading :)
Thanks Ziet. Much appreciated.
Btw, which Interactive Broker site/country are you signed up with? & why that choice?
Learned a lot about how to use IBKR with your videos. When I place a stop limit order, it is not getting triggered. e.g. say on a long call at 20 and the stop order is at 15, when the price falls way past 15 to 13 the stop loss does not trigger, I understand it's a market order but can't figure out what's wrong, but not sure if it's my set-up, any ideas?
Hi Dhivya, hmmm could it be due to liquidity? You could be trading an OTC stock with very low liquidity, or the trading hour was not during market hours?
Best check with IBKR customer support as they are able to check your log and handle your issue better!
Hi
Please make complete tutorial video on how to(Transfer Positions) to another ibkr account with same position
Interesting👀 will look into it!
I didn't get it ,i heard that your stocks belong to you with a custodian and you can reclaim them even if the broker go bust ,and sipc cover the cash balance,is that right or iam wrong
Yes, they are the custodian basically
Hi ziet!
I have question for you regarding on ibkr.
If i want to trading and investing on ibkr, which market data do i need to subscribes in order to get real-time price? There are so many market data selections. Very confusing.
Assuming that I am trading and investing on stocks in NYSE & NASDAQ
Thanks.
Hi! Actually you dont need to subscribe to any because NYSE and NASDAQ is free by default!
@@ZietInvests yes free, but its delayed 15mins right?
When will you review IBKR latest quarterly results? This week? 🙂
Next Monday! Im actually doing it at the moment 😁😁 stay tuned!!
Tks
If I buy a lot voo etf and interactive brokers go bankrupt, my voo holdings are still safe and give back to me 100% ?
Under the SIPC coverage yes, you will get your stocks and funds back 😊 (or if IBKR was bought out by another institution)
Should ibkr experience financial turmoil their policy states that client assets are considered separate from the broker itself yes?
Yep! according to the policy, client assets are considered separate from the assets of the broker.
Im traumatized from Block fi.
when I hear they are not FDIC insured I had flashbacks.
but to see the break down on their finances and insurance promo that was nice. Im trying to do futures trading on this platform. Is there a monthly fee? or just commission fees?
Nope! just commission fees - very very cheap + no hidden fees!
@@ZietInvests thank you for your reply. Do you also future trade?
do SIPC & FSCS protection applies to non US residents like us Malaysians
From my understanding, Yes, it applies to the respective account, not the residency
I did contact IB support for exactly this question 2 weeks ago, but no answer
From my understanding the protection is for US residents only. I am waiting for their answer
I asked chatgpt and this is what i get 😂
The Securities Investor Protection Corporation (SIPC) is a nonprofit corporation established by the US Congress to protect customers of brokerage firms that are members of SIPC.
SIPC protection generally applies to customers of SIPC-member brokerage firms who are US residents, as well as US citizens living abroad. However, non-US residents may also be eligible for SIPC protection if they have an account with a US-based brokerage firm that is a member of SIPC.
The specific details of SIPC protection for non-US residents may depend on the laws and regulations of the non-US resident's home country, as well as any applicable international treaties or agreements. It is recommended that non-US residents contact the SIPC directly or consult with a qualified financial professional to determine their eligibility for SIPC protection.
www.sipc.org/for-investors/investor-faqs
Questions about residency and citizenship status and SIPC protection
Are non-residents of the U.S protected by SIPC? What about non-U.S. citizens?
Non-residents and non-U.S. citizens are eligible for the same protections from SIPC as all other customers. There is no requirement that a customer reside in, or be a citizen of, the United States in order to be eligible for SIPC protection.
Do you know how much interest ibkr is offering on available cash in our accounts?
Hi Kevin, it varies according to the fed funds rate, can check out here: www.interactivebrokers.com/en/accounts/fees/pricing-interest-rates.php
@@ZietInvests alright, thanks for the reply. 👍
How to file W 8 Ben.
Very new to IBKR and investing
Any video's on this?
Need help
No need to do anything, its done by IBKR for you
@@ZietInvests
Ok thanks alot.
God bless you
SIPCor FINRA protection doesn’t apply to Hongkong IBaccounts, so there is a risk if it collapses
Clients under HK are protected under the respective HK schemes
So, is Charles Schwab still a good broker to diversify/place our cash/investments into?
When we buy a share in IBKR, what do we buy? the share title or a share certificate ?
Because if we have the title of the share in our name, it can go bankrupt that the action will be in our name! It remains to be seen whether it is the title or the certificate
Hey there, to my knowledge, we should be purchasing the ownership rights (moneymainst.com/do-you-own-stocks-on-interactive-brokers/) but do not receive share certificate because today's shares are held in electronic form called street name registration.
But then again, do confirm this with the live chat support for better clarification!
So the Lloyds policy gives individual customers up to 30M USD (good) but the TOTAL coverage is 150M USD 😮?!
So if 5 mega investors have 30M each in IBKR there is zero cover left for everyone else. Wow.
Now sure many will say ‘there aren’t any investors with 30M’. Maybe. But there might be hundreds with 3M. Same effect on smaller investors. No protection left for us.
Correct, hence why it’s additional, you are still covered under SIPC (IBKR US users)
@@ZietInvestswhat about Indian user?
Looking at the report is looking healthy , but why is stock amount keep plummeting?
Year to date still +10% eh, how is it plummeting?!
The decline you see today is probably due to its latest earnings - which is not included in the making of this video!