Interactive Brokers terminating accounts due to inactive trading?

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Ken.
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Interactive Brokers terminating accounts due to inactive trading?

Post by Ken. »

I have been using ibkr since last year for converting currency and sending overseas, never using my brokerage account for trading. I just received an email saying that they may close my account in thirty days if I don't have any trading activity.

Has anyone else been using their accounts solely for currency conversion and withdrawal and received email like this?
hithere
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by hithere »

I think the main thing they hate is having accounts with no activity AND no securities. So just buy a little bit of equity or whatever and they shouldn't bother you any more.
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Ken.
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by Ken. »

hithere wrote: Wed Jun 22, 2022 3:14 am I think the main thing they hate is having accounts with no activity AND no securities. So just buy a little bit of equity or whatever and they shouldn't bother you any more.
I can't say I blame them for that, but I'm not sure I personally want to have another account to deal with at tax time, unless there's something like an ETF that doesn't pay dividends. I just wanted to use that account for currency conversion. I'll have to think about it, but might just go back to one of the standard international money transfer companies even if they are more expensive.
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LTCM
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by LTCM »

Are they cheaper than Wise? I have a largish transfer I need to make this week.
60% VUG - 20% VEA - 10% EDV - 10% I-Bonds
pseudoiterative
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by pseudoiterative »

LTCM wrote: Wed Jun 22, 2022 4:38 am Are they cheaper than Wise? I have a largish transfer I need to make this week.
See IBKR - Spot Currency Commissions.

If you are in the lowest tier of trading volume, IBKR charge a commission that is the greater of USD $2 or 0.2 basis points of the trade value. E.g. if you wanted to convert USD $2 to AUD then IBKR would charge you a commission of USD $2 and you would get AUD $0. If you wanted to convert USD $1m they would charge you a commission of USD $20 and then you would get however many AUD $1m-$20 trades for on the foreign exchange market right now.

If you wanted to convert USD $1m to AUD using wise then apparently the minimum fee is 0.41%, which is $4100. So IBKR fees look 200x cheaper than wise for a $1m transaction. But maybe they aren't quite comparable if there's also a bit of a fee or spread in the rates offered by the forex exchange market that IBKR connects you with (before IBKR's commission is added).

It'd be interesting to see what it comes out to exactly with the respective rates. If you happen to have an IBKR account anyway, it wouldn't be surprising to see that IBKR's offering is highly competitive and favourable to simpler, more usable retail-customer-designed alternatives (especially if you are not in a hurry and are willing to place a limit order through TWS and wait to execute when the exchange rate randomly wiggles a bit in your favour).
ccompounder
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by ccompounder »

They are called interactive brokers.
You are looking for inactive brokers.
hithere
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by hithere »

Ken. wrote: Wed Jun 22, 2022 4:04 am
hithere wrote: Wed Jun 22, 2022 3:14 am I think the main thing they hate is having accounts with no activity AND no securities. So just buy a little bit of equity or whatever and they shouldn't bother you any more.
I can't say I blame them for that, but I'm not sure I personally want to have another account to deal with at tax time, unless there's something like an ETF that doesn't pay dividends. I just wanted to use that account for currency conversion. I'll have to think about it, but might just go back to one of the standard international money transfer companies even if they are more expensive.
Then you can do a small currency or other trade every 6 months or so. If I recall correctly, the past 6 months is the period they look at in order to decide if they should close an account or not. Leaving some cash in the account might help as well.
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anon_investor
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by anon_investor »

Ken. wrote: Wed Jun 22, 2022 4:04 am
hithere wrote: Wed Jun 22, 2022 3:14 am I think the main thing they hate is having accounts with no activity AND no securities. So just buy a little bit of equity or whatever and they shouldn't bother you any more.
I can't say I blame them for that, but I'm not sure I personally want to have another account to deal with at tax time, unless there's something like an ETF that doesn't pay dividends. I just wanted to use that account for currency conversion. I'll have to think about it, but might just go back to one of the standard international money transfer companies even if they are more expensive.
Just buy a share of BRK-B.
martyboyle
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by martyboyle »

LTCM wrote: Wed Jun 22, 2022 4:38 am Are they cheaper than Wise? I have a largish transfer I need to make this week.
I was just playing around and converting 100k USD to EUR was cheaper in IBKR, but the same for USD to CAD was cheaper in Wise. (I was using Paper mode on IBKR so I couldn't really see the fee breakdown)

I haven't used either but it looks like the usefulness of IBKR for currency conversion is more narrow than Wise. Maybe someone who has actually used IBKR for forex can correct me but a few things came to mind with IBKR:
1. Since IBKR is using market rates, etc, does this mean it can only be traded when the market is open?
2. 25 currencies available in IBKR, more are available with Wise. For example, INR is not an option with IBKR.
3. How smooth is the process is overall
Atlantic_ave
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by Atlantic_ave »

Ibkr is ridiculously cheap. I have wise, revolut and IBKR, but it won’t even compare. You have all type of fees and limits for withdrawals with the other two. May be OK if you go spend two days in europe, but as an expat, you need more flexibility. The fx market is open 24h from sunday night to friday night. That is when you do your trades.
You should read the horror stories about wise. If you get your account frozen for verifications, it can take a really long time to be able to recover your funds.
Ibkr also comes with one free international transfer per month. When i send money to my local foreign account at 8am, it arrives before 9am.
In the past year i prob exchanged $30k with wise and $400k with IBKR. As of now, i discontinued using Wise, because the math didn’t make sense.
gtwhitegold
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by gtwhitegold »

Is it worth it if you only transfer a few hundred dollars each month? My wife transfers money to Indonesia on a regular basis.
Atlantic_ave
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by Atlantic_ave »

gtwhitegold wrote: Wed Jun 22, 2022 9:51 am Is it worth it if you only transfer a few hundred dollars each month? My wife transfers money to Indonesia on a regular basis.

With IBKR, you can withdraw currencies only to a local destination account that belongs to you. So you can’t send money to a relative for example.
gtwhitegold
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by gtwhitegold »

Atlantic_ave wrote: Wed Jun 22, 2022 10:41 am
gtwhitegold wrote: Wed Jun 22, 2022 9:51 am Is it worth it if you only transfer a few hundred dollars each month? My wife transfers money to Indonesia on a regular basis.

With IBKR, you can withdraw currencies only to a local destination account that belongs to you. So you can’t send money to a relative for example.
I appreciate the information. However, it doesn't really answer if it will save money on small transactions.
richard.h.gao
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by richard.h.gao »

Ken. wrote: Wed Jun 22, 2022 3:04 am I just received an email saying that they may close my account in thirty days if I don't have any trading activity.
https://ibkr.info/node/314 :confused
richard.h.gao
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by richard.h.gao »

ccompounder wrote: Wed Jun 22, 2022 5:32 am They are called interactive brokers.
You are looking for inactive brokers.
:mrgreen:
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LTCM
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by LTCM »

Atlantic_ave wrote: Wed Jun 22, 2022 10:41 am
gtwhitegold wrote: Wed Jun 22, 2022 9:51 am Is it worth it if you only transfer a few hundred dollars each month? My wife transfers money to Indonesia on a regular basis.

With IBKR, you can withdraw currencies only to a local destination account that belongs to you. So you can’t send money to a relative for example.
Bummer. Nice rates but I need to transfer to people who are not me.
60% VUG - 20% VEA - 10% EDV - 10% I-Bonds
richard.h.gao
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by richard.h.gao »

LTCM wrote: Wed Jun 22, 2022 5:33 pm Bummer. Nice rates but I need to transfer to people who are not me.
You can. https://www.interactivebrokers.com/en/index.php?f=25355
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LTCM
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by LTCM »

richard.h.gao wrote: Wed Jun 22, 2022 5:43 pm
LTCM wrote: Wed Jun 22, 2022 5:33 pm Bummer. Nice rates but I need to transfer to people who are not me.
You can. https://www.interactivebrokers.com/en/index.php?f=25355
It says US only
Use Bill Pay to pay almost any company or individual in the United States
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AlohaJoe
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by AlohaJoe »

martyboyle wrote: Wed Jun 22, 2022 7:45 am :1. Since IBKR is using market rates, etc, does this mean it can only be traded when the market is open?
Currency markets never close.
richard.h.gao
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by richard.h.gao »

LTCM wrote: Wed Jun 22, 2022 6:36 pm
It says US only
You can wire anywhere once a month for free. Additional wires are only $1.

https://www.interactivebrokers.com/en/i ... ng&p=cash1
Atlantic_ave
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by Atlantic_ave »

richard.h.gao wrote: Wed Jun 22, 2022 9:49 pm
LTCM wrote: Wed Jun 22, 2022 6:36 pm
It says US only
You can wire anywhere once a month for free. Additional wires are only $1.

https://www.interactivebrokers.com/en/i ... ng&p=cash1
But you can wire only to an account belonging to you.
Atlantic_ave
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by Atlantic_ave »

gtwhitegold wrote: Wed Jun 22, 2022 11:50 am
Atlantic_ave wrote: Wed Jun 22, 2022 10:41 am
gtwhitegold wrote: Wed Jun 22, 2022 9:51 am Is it worth it if you only transfer a few hundred dollars each month? My wife transfers money to Indonesia on a regular basis.

With IBKR, you can withdraw currencies only to a local destination account that belongs to you. So you can’t send money to a relative for example.
I appreciate the information. However, it doesn't really answer if it will save money on small transactions.
You will save money regardless of size of transaction. You will have access to the same rate than currency brokers.
aspiring_kiwi
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by aspiring_kiwi »

AlohaJoe wrote: Wed Jun 22, 2022 6:46 pm
martyboyle wrote: Wed Jun 22, 2022 7:45 am :1. Since IBKR is using market rates, etc, does this mean it can only be traded when the market is open?
Currency markets never close.
Not quite true. They're open 24hrs/day, 5 days per week. Closed from friday evening through sunday evening:

https://brokerchooser.com/education/for ... ding-hours
AlohaJoe
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by AlohaJoe »

aspiring_kiwi wrote: Wed Jun 22, 2022 11:27 pm
AlohaJoe wrote: Wed Jun 22, 2022 6:46 pm
martyboyle wrote: Wed Jun 22, 2022 7:45 am :1. Since IBKR is using market rates, etc, does this mean it can only be traded when the market is open?
Currency markets never close.
Not quite true. They're open 24hrs/day, 5 days per week. Closed from friday evening through sunday evening:

https://brokerchooser.com/education/for ... ding-hours
True! I wasn't thinking about the weekends when I wrote that :oops: . I guess they are closed for a few hours over the weekend when it is some combination of "not yet Monday in Australia" and "already past Friday in the US".
gougou
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by gougou »

gtwhitegold wrote: Wed Jun 22, 2022 11:50 am
Atlantic_ave wrote: Wed Jun 22, 2022 10:41 am
gtwhitegold wrote: Wed Jun 22, 2022 9:51 am Is it worth it if you only transfer a few hundred dollars each month? My wife transfers money to Indonesia on a regular basis.

With IBKR, you can withdraw currencies only to a local destination account that belongs to you. So you can’t send money to a relative for example.
I appreciate the information. However, it doesn't really answer if it will save money on small transactions.
You pay $2 to convert small amounts (anything less than $100K USD) and you get the best possible exchange rate in the market.

So if you convert $100 it’s probably not worth it. $1000 or more you should come out ahead any other places.
gtwhitegold
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by gtwhitegold »

gougou wrote: Thu Jun 23, 2022 12:06 am
gtwhitegold wrote: Wed Jun 22, 2022 11:50 am
Atlantic_ave wrote: Wed Jun 22, 2022 10:41 am
gtwhitegold wrote: Wed Jun 22, 2022 9:51 am Is it worth it if you only transfer a few hundred dollars each month? My wife transfers money to Indonesia on a regular basis.

With IBKR, you can withdraw currencies only to a local destination account that belongs to you. So you can’t send money to a relative for example.
I appreciate the information. However, it doesn't really answer if it will save money on small transactions.
You pay $2 to convert small amounts (anything less than $100K USD) and you get the best possible exchange rate in the market.

So if you convert $100 it’s probably not worth it. $1000 or more you should come out ahead any other places.
Thanks!
NerdJock
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by NerdJock »

Schwab, fidelity all kept my account open with less than a dollar in them.
The really don't want to close your account.
student
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by student »

Buy brokered cd or t-bills to make it active?
ToBeOrNot
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by ToBeOrNot »

I’m in the LITE commissions pricing structure and haven’t made a trade in over 18 months and haven’t had a threat of shutdown. I do however have periodic deposit activity.

Check which price structure your account is configured for. The LITE model doesn’t have inactivity fees.
Topic Author
Ken.
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by Ken. »

anon_investor wrote: Wed Jun 22, 2022 6:59 am
Ken. wrote: Wed Jun 22, 2022 4:04 am
hithere wrote: Wed Jun 22, 2022 3:14 am I think the main thing they hate is having accounts with no activity AND no securities. So just buy a little bit of equity or whatever and they shouldn't bother you any more.
I can't say I blame them for that, but I'm not sure I personally want to have another account to deal with at tax time, unless there's something like an ETF that doesn't pay dividends. I just wanted to use that account for currency conversion. I'll have to think about it, but might just go back to one of the standard international money transfer companies even if they are more expensive.
Just buy a share of BRK-B.
Perfect, thanks!
Topic Author
Ken.
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Re: Interactive Brokers terminating accounts due to inactive trading?

Post by Ken. »

ToBeOrNot wrote: Fri Jun 24, 2022 12:52 am I’m in the LITE commissions pricing structure and haven’t made a trade in over 18 months and haven’t had a threat of shutdown. I do however have periodic deposit activity.

Check which price structure your account is configured for. The LITE model doesn’t have inactivity fees.
I'm also in the LITE pricing plan and my activity has been just a couple of deposits.
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