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Dear Ramsburg, metro, andyman, poiss and other experienced users of Interactive Brokers.

I'd like to open my first margin account in the Interactive Brokers.
I'm newbie in trading and in on-line brokers. Before I've found this excellent site, I used for investing my local bank service and paid $25 + broker commissions 0.01 c/share. It was terrible even for investing  and absolutely doesn't meet for trading.

I'd like to ask you some questions about InteractiveBrokers.com :

1.   How much I'll pay for a trade with 500,000 Penny Stocks (0.002 cent/share) - $2 or $2502.50?

Trade value = $1000
1 share price = $0.002   
Max 0.2% of trade value = 0.2%*$1000=$2
Up to 500 shares 0.01/share + 0.005/share = $2502.50

2.   Is it possible to place Stop or Trailing Stop on Penny Stocks orders?
3.   Is it possible to place Penny Stocks orders on PreMarket?
4.   I've used a little bit Medved Quote Tracker before. What do you suggest for beginner: to use Medved Quote Tracker together with IB TWS or it's enough to use ONLY Interactive Brokers SW (TWS, TWS Trading Tools)? 

Any suggestions and comments would be greatly appreciated
Gregory

the commission is max of 0.2% of in your example $2

Up to first 500 charge at 1 cent does not apply as total dollar trade value is so low

You can place stops but two things to be aware of -  IB system does not work for 4th digit so if you trade say BLYC and it is at 0.0042 you can put in your order to buy at 0.005 but not at 0.0042. This could cause a problem of course if there were no offer between 0.0042 and 0.005 -   also with stops remember that stops become market orders when triggered so can execute lower then where you may want.


IB does not fill any OTC orders in pre market as they only use electronic exchanges and for OTC stocks they will not work until market opens - you can place your order though and it will be send when market opens.

I use the level II windows of Quote tracker only because I prefer the looks of them and can have many open at the same time - I have an account with Ameritrade or whoever they are not called just to feed Quotetracker as U have found their feed most reliable and fast.

Hi gri64,

I can confirm metro's infos. IB has some restrictions if it comes to pennies, but with some care and discipline it can be handled.

However keep in mind to have always some extra cash left – not fully using your margin – in dealing with pennies.

If you initially buy a penny position, IB charges you the 1 penny per share for the first 500, but it refunds you this on the next day against the 0.2%.
So if you have a larger position you will be surprised to see in the "unrealized P/L" suddenly a big negative amount. That will go on the next day as I already said.
However, for the margin calculation of the current day they take this unadjusted figure. So if you are calculating very tight you will end up on the end of the day in margin call, although you have according to the 0.2% rule still cash.

Not knowing that, can be quite surprising for a newbee. But for this we are here. 

Regards, andyman 

Hi metro and andyman,

Thank you very much for the replies.
That was very professional, helpful and applauded 

Now I try to open an account in IB - it's not so easy, because all my documents and bills are in Hebrew and now IB have to translate them....

Dear friends, can you say some words about taxes?
I'm non-USA resident, I live in Israel and I have citizenship of the Israel and Russia.

I filled out W-8BEN "CERTIFICATE OF FOREIGN STATUS OF BENEFICIAL OWNER FORM U.S. TAX WITHHOLDING", but I don't understand will I pay taxes in accordance with USA law or in accordance with Israel law?   

Good luck,
Gregory

Hi gregory! 
About the taxes, i'm also not american, i have to pay taxes according to my country laws, not the us legislation.
Best regards

Hi friends,

I have a problem with account opening in Interactive Brokers and I don't know what I have to do: forget about IB, or send to IB more abusive letters, or once more try to open new account.   

The problem is like this:
After some actions and letters I was at the last stage of Account Application  - all my documents (Passport and Telephone bill) were translated and Tentatively Accepted. I expected to get finally accepted status, but suddenly I received disappointed letter from IB and status of Utility Bill was changed to the Not accepted - pl. check your e-mail

In email IB wrote me:
"Your application to open or upgrade an account ... is currently on hold because the Utility Bill you submitted via E-mail on 06 Jul 2005 20:00:11 EDT was found to be unacceptable as Proof of address...
...
Please verify your full address and include any street/house numbers since this information is not currently listed."

So, I understood, that I made mistake during Account Application form filling - I didn't include in "Account Holder" my house/apt numbers. I filled out only street name in Mailing Address field.   

I browse the IB site, but I didn't find in IB site how to return to the Account Application form filling. It's very strange... I'm not newbie in PC and SW... 

Do someone know, how can I add now this requested (not filled) information to my Account Application? And how to get help and support from IB? I've asked help and any suggestion from IB twice during last 3 days but didn't receive any email ...

Thank you very much for your replies

Regards,
Gregory

Hi gri64,

Sorry for answering a little late. I am not a "fulltime" trader or "PRIPRO" (private profi), so sometime I am offline. Also, no problem for contacting me direct.

Concerning your problem, I forgot to mention this in my message because I thought you finished your account setup already.
However don't panic, things can be solved. To feel comfortable, I had same problems due to the fact that I have my main residency in Dubai. And the addressing system there is also not so developed as in my home in  Europe or US.

IB has a quite stringent security and identification policy. I think they want comply with various international regulations as much as possible. And there are dealing most properly direct at the markets, and not via other brokers and not only US. They serve also all European markets.

I faced my problems exactly at the same spot – the utility bills.

IB's intention is to verify your physical address through official receipts.
They are looking for following set of information on the official receipt:

Your Name – House/Flat Number – Street Name/Number – City/Town

If your utility bill does not contain the full record your application will be put on hold.

I resolved this by consulting IB and explaining why this is not applicable here and finally I scanned the headers of three documents into one document:

• My utility bill (Water/Electro)
• my telephone bill and
• the header of my bank statement.

All three together contained my Name. The other information where at the various bills which I explained afterwards. Somehow it worked.

To get a account with IB it takes some time, but afterwards you will feel comfortable with them.
You just have to master the initial barriere.

All the best
andyman

Hi andyman,

Thank you very, VERY, very much for your helpful and friendly reply!
It's very sad that my English is so poor - I can't explain how you supported me...
Now I'm a more optimistic in my case because of your very useful letter.

Unfortunately, my problem is a little bit different:
Initially, IB had accepted my utility bill and asked me to verify "is this my correct residential address?". I sent them confirmation and only after that I received last letter with message about "Your application to open or upgrade an account ... is currently on hold ....".

My problem is that I have to change (to fill out missed House/Flat numbers) my Account Application form but I can't find how to do it? 
And why IB doesn't answer to my e-mails with this question!? ...
May be the best way is to call to IB?

Andyman, a lot of thanks for you.
All the best,
Gregory

Hi gri64

It's OK, I try to help you as much as I can. However, English is also not my mother tongue, so you are not alone.   

OK, considering your problem let us figure things out. As I feel the problem is not so different, it could be quite close. You have to understand that after Sept. 11 all applicants from middle east countries are getting thoroughly checked, independent if you are from local origin or a expatriate. And the standards of IB are very high in this regard.

When IB asked you to verify the address in the utility bill, what did you do?

It looks like that is not IB who rejected the document, it is some further department in the security – otherwise they would not have changed the status back, which means that it initially passed IB's internal check.

I reviewed my communication with IB, and I remember that I send additional a copy of my tenancy contract which certainly verified my address after I faced the problem that the landlords name was on the utility bill.
However, the whole registration process with IB took me one (1) month.
And after all documents where OK, it still took 14 days until I received the final confirmation.

Maybe it is not IB who need that time. It could be the guys at the "Homeland Security Dept." who take some days to open your file 
Please consider too, when I joined IB 1½ years ago they where new. Now after extensive advertising there will be flooded with applications.

hoping that we can manage things

Regards, andyman

I checked with your earlier message and think your problem is:

• After filing a online application you can change your personal data after logging in to the "Account Management Menu".
• Since you made a mistake while filling out the application, your application is on hold and you did not get a user ID and a password.
• However, for logging in to the "Account Management Menu" you need your user ID and password.

Ahhmmm,  closed circle!   

Best you can do and I guess IB gave you the hint - Just provide a document (utility bill or tenancy contract or bank statement [that's the best then bankers believe preferably bankers]) and explain them in a mail kindly that you made a mistake and they shall correct your initial statement in the application form. Then it will take some days time because it has to go through some departments.
I hope you did not made the same mistake in the W8BEN, otherwise correct.
Please be friendly and avoid pressure. That helps. IB may be quite busy after the marketing spot at Bloomberg. It takes approx. two(2) days for a answer.
But even trough I had also a couple of complications (as you) they (IB) always kept style and newer got rude.

Regards, andyman

Quote from: andyman on July 16, 2005, 10:58:53 AM
I checked with your earlier message and think your problem is:

• After filing a online application you can change your personal data after logging in to the "Account Management Menu".
• Since you made a mistake while filling out the application, your application is on hold and you did not get a user ID and a password.
• However, for logging in to the "Account Management Menu" you need your user ID and password.

Ahhmmm,  closed circle!   

Best you can do and I guess IB gave you the hint - Just provide a document (utility bill or tenancy contract or bank statement [that's the best then bankers believe preferably bankers]) and explain them in a mail kindly that you made a mistake and they shall correct your initial statement in the application form. Then it will take some days time because it has to go through some departments.
I hope you did not made the same mistake in the W8BEN, otherwise correct.
Please be friendly and avoid pressure. That helps. IB may be quite busy after the marketing spot at Bloomberg. It takes approx. two(2) days for a answer.
But even trough I had also a couple of complications (as you) they (IB) always kept style and newer got rude.

Regards, andyman

Hi andyman,

You are a very intelligent person - your last posts were great. 
I'm sorry for this sad post, in any case, thank you very much for you help 

Unfortunately, I still can't say any good word about IBs  (only damnation)... Usually, I'm very friendly and quiet man, but after 2 weeks of correspondence with IB I've lost my mind... 
It seems to me, that IBs don't read my emails (it doesn't matter big or short); they pull out one sentence or one word and write a formal reply. 

• what do you think, maybe I have to close uncompleted account and try to open a new account in IB? Is it possible?
• by the way, if account opening takes a lot of time and a lot of mails, what will be with more complicated task - money withdraw? 1 month, or 1 year or more?... 

I'd like to paste my fifth letter to IB (sorry for large quotation). Please, take a look at this mail, is it possible to understand my problem?

Dear Michael,

I understand, that you have to verify my physical address listed in my Account Application.

I made a foolish mistake during Account Application form filling - I didn't include in "Account Holder" my house/apt numbers. I filled out only street name in Mailing Address field.

So, it doesn't matter, what kind of legal document (bill) I'll send to your – in any case my physical address in the bill and my physical address listed in my Account Application will be different, because my address in Account Application form is uncompleted!

In refusal letter (Date: Jul 12, 2005 6:15 PM) Interactive Brokers wrote me:
"Please verify your full address and include any street/house numbers since this information is not currently listed."

From Jul 12 and up today I sent 4 (!) letters with very simple question: "How can I add this requested (not filled) information to my Account Application?"

I'm QA SW expert, but I didn't find in your site how to return to the Account Application form filling – I entered to the Account Management Login and Password and I see my "Application Status" without possibility to edit the Account Application.

So, I really need your help!!!

Regarding documents with my home address: I've sent you my home address twice: not only in the Utility Bill (my International Telephone Bill) but also in the National ID card.

I'm waiting your suggestion how to resolve the problem with my home address.
I'm still very interesting in doing business with Interactive Brokers.

Regards,
Gregory