Our brokerage custodian, Interactive Brokers1, is preparing for potential elevated volatility associated with the upcoming United States presidential election on November 3rd, 2020.
What will change?
Soft Edge Margining (SEM) will change temporarily, effective Monday, October 26, 2020. SEM will end 30 minutes prior to a product’s respective close. Currently, SEM ends only 15 minutes prior to a product’s respective close.
What is Soft Edge Margining?
In general, your account is subject to automated liquidation once its equity value falls below the minimum margin requirement. However, Interactive Brokers allows you some leniency prior to a liquidation.
During the trading day, if your margin deficiency is less than 10% of your account’s Net Liquidation Value, it will not be automatically liquidated. In other words, your account will only be liquidated if it falls below the Soft Edge Margin.
This allows your account to be in margin violation for a short period of time. Once your account falls below SEM however, it is then required to meet full maintenance margin and your account will be subject to automatic liquidation to bring it back to margin compliance.
Please note that Interactive Brokers reserves the right to restrict Soft Edge access on any given day and she may eliminate SEM completely in times of heightened volatility. Second, Soft Edge Margin is not displayed in your Euro Pacific Trader.
1Euro Pacific Trader is offered by Euro Pacific Securities Inc. (“Euro Pacific Securities”), as an Introducing Broker to Interactive Brokers LLC. Interactive Brokers LLC is the custodian, technology provider, and clearing broker to all transactions executed through Euro Pacific Trader and thus the rates, conditions, and examples shown on this site may be subject to change and differ from what is displayed on Euro Pacific Trader. The rates, conditions, and examples on this site are provided on a best-efforts basis and should not be taken as final.
Euro Pacific Securities will not be held responsible for pricing and conditional discrepancies that may arise in the normal course of offering Euro Pacific Trader. Customers should always review and rely on the conditions that are shown directly on Euro Pacific Trader, and it is the responsibility of all customers to carefully review the conditions of every action before approving execution on Euro Pacific Trader.
Interactive Brokers LLC is a registered Broker-Dealer, Futures Commission Merchant and Forex Dealer Member, regulated by the U.S. Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC) and the National Futures Association (NFA), and is a member of the Financial Industry Regulatory Authority (FINRA) and several other self-regulatory organizations. Interactive Brokers LLC does not endorse or recommend any introducing brokers, third-party financial advisors or hedge funds, including Euro Pacific Securities. Interactive Brokers LLC provides execution and clearing services to customers. None of the information contained herein constitutes a recommendation, offer, or solicitation of an offer by Interactive Brokers LLC to buy, sell or hold any security, financial product or instrument or to engage in any specific investment strategy. Interactive Brokers LLC makes no representation, and assumes no liability to the accuracy or completeness of the information provided on this website.
For more information regarding Interactive Brokers, please visit www.interactivebrokers.com.