Overview:
Interactive Brokers Singapore Pte. Ltd. (“IBSG”) clients that qualify as (a) an Accredited Investor, (b) an Expert Investor and/or (c) an Institutional Investor, as defined under the Singaporean Securities and Future Act are eligible to open up an additional
linked account (“segment”) with IBSG’s US affiliate, Interactive Brokers LLC (“IBL”) to trade non-Singaporean products. This document outlines the benefits of the IBL segment and the key changes to your account after the segment is open.
Background:
This FAQ document summarizes some of the key changes to your account that would result from the opening of the IBL segment. If you require any further information, please contact us.
1. Who is eligible to open an IBL Segment?
Interactive Brokers Singapore Pte. Ltd. (“IBSG”) clients that satisfy all of the following criteria are eligible to open an IBL Segment:
(a) Qualify as an Accredited Investor, Expert Investor or Institutional Investor, as defined under the Singaporean Securities and Future Act. (Please note: any changes to your investor status may impact the operation of the IBL segment, including but not limited to restrictions on transactions and/or closure of the IBL segment).
(b) Trading Permission granted for US Options and Level 4 Options.
(c) The account has Total Net Liquidation Value greater than USD 400,000 (or foreign equivalent).
2. What products will be traded in the IBL segment?
Non Singaporean securities and securities derivatives will be automatically transferred (“Transfer”) to the IBL segment after opening.
3. When will the Transfer occur?
The Transfer is scheduled to occur on the weekends following the successful opening of the IBL segment.
4. What lower margin rates will I receive?
IBL’s margin rates are charged on a sliding scale as the amount borrowed increases. The IBL website has the latest rates: https://www.interactivebrokers.com/en/trading/margin-rates.php
5. Will my login credentials change?
No, clients will be able to access both their IBSG account and their IBL segment with their same login credentials.
6. Do I need to allocate trades to the IBL segment?
No, after the assets have moved to the IBL segment, you will be able to trade in and out of it seamlessly through your single login. Positions will automatically go to the correct account.
7. How can I fund the IBL segment?
Funding is done directly through your IBSG account. Trades to the IBL segment will automatically utilize the cash balances deposited to your IBSG account.
Part B - Legal and Regulatory Changes That You Should Be Aware Of
1. What conduct of business rules (including best execution) will apply to my relationship with IBLLC?
The U.S. conduct of business rules apply to IB LLC accounts. These rules are based on the regulations and rules set by the U.S. Securities and Exchange Commissions (“SEC”).
2. How will investments that I custody with IBLLC be held from a legal/regulatory perspective? Are there any material differences that will apply to my agreement with IBLLC compared to those that apply to my existing agreement with IBSG?
U.S. law and regulations regarding custody of securities and client funds apply to your accounts with IB LLC. These include rules set by the U.S. Securities & Exchange Commission (“SEC”) and the Financial Industry Regulatory Authority (“FINRA”). The US custody rules require that any cash and fully-paid securities held by IB LLC on your behalf must be held segregated from the assets of IB LLC.
3. How am I protected against loss? Are there any material differences that will apply to my relationship with IBLLC?
At IBLLC, your eligible assets are protected from loss under the U.S. Securities Investor Protection Corporation at an amount of up to USD 500,000 (subject to a cash sublimit of USD 250,000).
Please note that the U.S. Securities Investor Protection Corporation does not compensate for losses incurred by clients due to a drop in the market value of securities.
4. How do I make a complaint to IBLLC? Are there any material differences that will apply to my agreement with IBLLC compared to those that apply with IB SG?
The new Client Agreement sets out how to file a complaint with IBLLC. The complaints handling procedures are materially similar to those that apply to your existing agreement with IBSG.
5. How will my personal data be processed and protected? Are there any material differences that will apply to my agreement with IBL compared to those that apply to my existing agreement with IBSG in this context?
Your data will be processed and protected in accordance with the IB Group Privacy Policy, which can be found at: https://ndcdyn.interactivebrokers.com/Universal/servlet/Registration_v2.formSampleView?formdb=4102&lang=ja. There will be no material change to how your data is protected now.
Part C - Other Practical Questions and Next Steps
1. Who should I contact if I have any general questions?
Generally speaking, you should contact IBSG with any questions that you may have prior to the segment opening, and you should contact IBLLC with any questions specific to the IBL segment that you may have after opening takes place. Regardless of who you contact at Interactive Brokers, we will ensure your query is promptly dealt with and we will make best efforts to expediate any issues.
2. Will I have access to the same trading platform or be subject to any software changes following the transfer of my account?
The segment opening will have no impact upon the software you use to trade or administer your account. The technology will remain the same as it is today.
3. Will IBSG’s commissions and fees change when my account is transferred?
Commissions do not vary between your IBSG account and the IBL segment. However, after opening an IBL segment, both your IBSG account and IBL segment will benefit from the same margin rates as IBLLC.
4. Will my trading permissions change when the segment is opened?
Your trading permissions will not change when the segment is opened.
5. Will the current cost basis of positions be carried over when the segment is opened?
Yes, this segment will have no impact upon the cost basis of your positions.