@Abs_max Thank you !
And for information, I also found some discussion about it earlier in the thread : “Feb 16, 2023”
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I was about to buy the Pictet and Swisscanto Money Market funds mentioned, and noticed that they would increase my Interactive Brokers maintenance margin requirements, which I find super strange.
For example, if l have 5,000 CHF Cash in my account and buy one of these two the maintenance margin increases by 5,000 CHF. If I instead buy a Swiss Bond ETF like https://www.justetf.com/ch/etf-profile.html?isin=CH0102530786 this doesn’t happen.
Anyone else here that noticed this issue? If this is really the case and not an Interactive Brokers error it wouldn’t make any sense to buy these money market funds given the impact on margin.
It just means that you can’t use these funds as a “collateral” for a “margin loan”. Which is reasonable considering that they are not so liquid. Look at the “margin rate” in the quote to check. Should show 100%.
I think. Or maybe it has something to do with the fact that it takes few days to settle. In any case, I wouldn’t worry.
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Actually i find it a bit odd that it uses 100% margin since its usually calculated based off risk and money markets are reasonably safe. If you need to conserve margin buy bonds instead
There has been a recent change at IBKR and basically every single european mutual fund now has 100% margin requirements. It’s an intended policy change by ibkr, and they raised margin to 100% for every mutual fund not registered under the U.S. Investment Company Act, which is all of them.
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Thank you very much for the additional information!
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In my case I just want to have a part of my capital stored for emergency (so quickly to turn liquid) and at the same time protect a bit the capital depreciation. However, I am actually in that situation now to be looking where to allocate the capital and I could not find anything interesting. Accounts at UBS and others gives on average 0.5% and I could not find a reasonable MMF available in CHF to avoid exchange CHF/EUR exchange exposure.
MMF will give less than 0.5%
Yeah, I have my emergency fund sitting at 0.5% in my UBS account as well.
0.5% is a good rate, we’re in a new cycle with low Inflation.
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