Interactive Brokers' Initial Deposit

Interactive Brokers (known as IB) has recently raised their initial deposit from $5,000 to $10,000 (or the equivalent in several other currencies). The reason for this is that IB only wants professional traders as customers (not beginning traders). This puts beginning traders in a conundrum, because IB is the best brokerage for beginning traders, but beginning traders are not wanted at IB.

This amount of initial deposit is not really a fair amount, because the margin requirements for most day trading markets are much lower. For example, the margin requirement for the EUR (Euro Futures Market) is only $1,418, but IB still requires that traders deposit the full $10,000 to trade this market. To be fair to IB, the $10,000 initial deposit is just that, an initial deposit, as once the account has been opened, the balance can be reduced to $2,000.

Some Solutions

The initial deposit does not have to be all cash, so if you are a beginning trader that does not have the full $10,000 available as cash, perhaps you have some stock that you can transfer to your new IB account to make up the difference. If not, then you could consider to temporary loan (credit cards, personal loan, etc.) so that you can open your trading account with IB. Alternatively, you could open an account with another brokerage that does not have such a high initial deposit, and then switch to IB as soon as you have built up enough cash in your trading account to cover IB's initial deposit.

Profiles of Interactive Brokers and some other popular day trading brokerages are available in the Brokerage Profiles section of the day trading site.