Disclosure Regarding Interactive Brokers Price Cap Notices
Regulators expect brokerage firms to maintain controls designed to prevent the firm from submitting orders to market centers that create a risk of disruptive trading (e.g., the risk of sudden, transient price moves).
To comply with these expectations, Interactive Brokers implements various price filters on customer orders. Those price filters may, in certain circumstances, price cap customer orders in order to avoid market disruption, and those Price Caps will generally be in a % range from a reference price range calculated by IB. (The range of the Price Cap varies depending on the type of instrument and the current price.)
Although the price caps are intended to balance the objectives of trade certainty and minimized price risk, a trade may be delayed or may not take place as a result of price capping. More information is available in Interactive Broker’s Order Routing and Payment for Order Flow Disclosure.
If a customer’s order(s) are price capped by IB’s systems, that customer will either receive (i) real-time notification of those price cap(s) in Trader Workstation or via the API or FIX tag 58 (for FIX users); and/or (ii) a daily FYI message containing a digest of the first 10 order(s) that were price capped the prior day, the initial price cap(s) for those order(s) (if applicable), and the Price Cap Range(s) for further Price Cap(s) of those order(s).
Customers may opt out from receiving future FYI Messages by clicking the relevant opt-out link within an FYI Message. By opting out from receiving these future FYI Messages, a customer:
- Agrees to waive any further notifications from Interactive Brokers about the application of the firm’s Price Caps to that customer’s order(s); and
- Acknowledges that he or she understands that his or her orders may be price-capped in the future, but that the customer does not wish to be notified again about the application of any Price Caps to any of his or her orders.
Fractional Share Trading
概観:
Trading fractional shares allows you to invest in companies which you may not be able to afford the full share price. It also makes it easier for you to diversify your portfolio by allowing you to purchase fractional amounts in multiple companies when you otherwise may have only been able to purchase whole shares in one or two companies.
If you enable your account to trade in fractions, we will buy or sell a fraction of a share based on the amount of cash you specify. For example, if you want to spend $500 but one share of the stock you want to buy is currently $1000 you would end up with 0.5 shares.
Who is eligible for fractional share permissions?
All individual, standalone accounts (except those who reside in Israel, Canadian RRSP/TFSA accounts and Interactive Brokers Securities Japan Inc. ("IBSJ") entity accounts) are eligible for fractional share permissions.
Financial Advisors, Money Managers, and Introducing Brokers may enable their clients on an all-or-none basis.
How do I enable fractional shares?
If you are eligible then you can enable fractional share trading in Client Portal. Click the User menu (head and shoulders icon in the top right corner) followed by Settings. Under Account Settings find the section Trading and click on Trading Permissions. Scroll to "Stocks", click +Add and check the box next to "Global (Trade in Fractions)" and click on SAVE. Then click CONTINUE and follow the prompts on screen. You will then be able to trade in fractions in eligible stocks for which you have permission to trade. To trade fractions of eligible U.S. stocks, you will need to sign up to trade U.S. stocks, and to trade fractions of eligible European stocks, you will need to sign up to trade European stocks.
Please note, TWS Build Version 979 or later is required to trade fractional shares. This feature currently supports most order types.
What products can I trade in fractions?
We offer fractional share trading on eligible U.S., Canadian and European stocks and ETFs*.
A list of eligible stocks that can be traded in fractional shares is available via the following link. Please note, this list is subject to change without notice:
http://www.ibkr.com/download/fracshare_stk.csv
*Under EU regulations, EU retail clients generally cannot trade U.S. ETFs, in whole or fractional increments.
Can I short fractional shares?
IBKR does support short sales in fractional shares of eligible stocks as long as you have margin and approved trading permissions to trade fractional shares of stocks listed in the U.S. or in Europe.
What are the fees associated with fractional shares?
There is no additional fee to use fractional share trading. Standard commission rates (both IBKR Lite and IBKR Pro, where applicable) apply.
What order types can I choose for fractional trading?
IBKR will only accept certain types of orders for fractional shares (e.g., market orders, limit orders, stop orders, stop limit orders, etc.). If you choose to place an unmarketable limit order with a fractional share component, the fractional component may not execute until the order becomes marketable (and therefore may not execute at all), even if the order might have executed earlier if submitted for a whole share quantity.
How does IBKR handle fractional shares orders in European stocks?
Depending on the size and nature of the order, IBKR will direct orders in European stocks that include a fractional share component to a pool of execution venues which might be different than those utilized for other order types. You should review the applicable order execution policy for more details.
Can I transfer fractional shares to IBKR?
IBKR does not accept fractional shares through a position transfer.
Are fractional shares eligible for the Dividend Reinvestment Program (DRIP)?
Yes, it is possible to receive fractional shares for a reinvested dividend through the Dividend Reinvestment Program (DRIP) if the account has fractional share permissions.
Please note the above does not apply in the event of mutual fund dividends, which can be re-invested and may result in holding fractional shares of the fund.
Will I receive a fractional share position from a corporate action?
If your account has been approved for trading fractions and a US or European corporate action issues fractional shares, the fractional shares will remain in your account. However, if your account does not have permissions to trade in fractions or the corporate action is issuing non-eligible shares, the fractional shares will be liquidated.
Will I have voting rights for fractional shares in my account?
You will not have voting rights for any of the fractional shares held in your account, you will not be able to make voluntary elections on any corporate action (including, without limitation, any tender offers or rights offerings) with respect to such fractional shares, and we cannot provide you any other shareholder documentation for any holdings of less than one share.
Do I receive dividends on my fractional shares?
Your fractional shares positions are eligible to receive dividends in the same manner as your full positions on the same stocks.
Is fractional trading available for the API?
Fractional trading is supported via FIX/CTCI but not via API at this time.
PRIIPs Overview
BACKGROUND
In 2018, an EU regulation, intended to protect “Retail” clients by ensuring that they are provided with adequate disclosure when purchasing certain products took effect. This disclosure document is referred to as a Key Information Document, or KID, and it contains information such as product description, cost, risk-reward profile and possible performance scenarios.
This regulation is known as the Packaged Retail and Insurance-based Investment Product Regulation (MiFID II, Directive 2014/65/EU), or PRIIPs, and it covers any investment where the amount payable to the client fluctuates because of exposure to reference values or to the performance of one or more assets not directly purchased by such retail investor. Common examples of such products include options, futures, CFDs, ETFs, ETNs and other structured products.
The UK Financial Conduct Authority (FCA) has equivalent requirements for UK residents.
It’s important to note that a broker cannot allow a Retail client to purchase a product covered by PRIIPs unless the issuer of that product has prepared the required disclosure document for the broker to provide to the client. U.S. clients are not impacted by PRIIPs, so the issuers of U.S. listed ETFs do not as a rule create KIDs. This means that EEA and UK Retail clients may not purchase the product. Clients nevertheless have several options:
- Many US ETF issuers have equivalent ETFs issued by their European entities. European-issued ETFs have KIDs and are therefore freely tradable.
- Clients can trade most large US ETFs as CFDs. The CFDs are issued by IBKRs European entities and as such meet all KID requirements.
- Clients may be eligible for re-classification as a professional client, for whom KIDs are not required.
CLIENT CATEGORISATION
We categorize all individual clients as “Retail” by default as this affords clients the broadest level of protection afforded by MiFID. Client who are categorised as “Professional” do not receive the same level of protection as “Retail” but are not subject to the KIDs requirement. As defined under MiFID II rules, “Professional” clients include regulated entities, large clients and individuals who have asked to be re-categorised as “elective professional clients” and meet the MiFID II requirements based on their knowledge, experience and financial capability.
We provide an online step-by-step process that allows “Retail” to request that their categorisation be changed to “Professional". The qualifications for re-categorisation along with the steps for requesting that one’s categorisation be considered are outlined in KB3298 or, to directly apply for a change in categorisation, the questionnaire is available in the Client Portal/Account Management.
VXXおよびVXZの満期に関する情報
イントロダクション
iPath S&P 500 VIX短期先物（VXX）および中期先物（VXZ）の上場投資証券（ETN）の満期が2019年1月30日に予定されています。この満期に先立ちETNの発行体であるBarclays Bank PLCは、iPath Series B S&P 500 VIX短期先物（VXXB）および中期先物（VXZB）を発行しました。こちらは2018年1月より取引されており、2048年に満期となります。
満期となるETNのポジションおよび/またはデリバティブ商品をお持ちのお客様は、これに関連する時期、可能な選択肢とそのリスク、また証拠金関連の影響などにご注意ください。アクションが何も行われない場合や証拠金を考慮に入れないアクションが行われた場合には、口座が証拠金不足となり強制決済につながる可能性もありますのでご注意ください。
以下はこちらに関連するよくあるご質問になります。
FAQ
Q: VXXとVXZのETNはいつ満期になりますか。
A: VXXおよびVXZは2019年1月30日の市場開始時間をもって満期となり、上場廃止となります。
Q: VXXとVXZの最終取引日はいつですか。
A: VXXとVXZの最終取引日および満期時の最終査定日は2019年1月29日なります。
Q: VXXとVXZの満期時にはどうなりますか。
A: VXXとVXZを保有されるお客様には現金、およびBシリーズへ1:1ベースでの償還が可能です。満期となるETNをお持ちのお客様はこちらをクローズした上で、2019年1月30日前に流通市場でBシリーズに相当するポジションに代えることもできます。
Q: 満期になった証券を現金に償還する場合、どういった金額になりますか。
A: 満期となるETNを現金に償還する場合、2019年1月29日（最終査定日）におけるETNのクローズ時気配価格に相当する現金をお受取りいただきます。
Q: 償還はいつ口座に反映されますか。
A: 現金またはBシリーズへの償還は2019年1月29日の終了時以降に処理され、2019年1月30日の市場開始前にお客様の口座に反映されます。
Q: 償還の選択はどのようにIBKRに伝えるべきですか。
A: 満期となるポジションをお持ちのお客様には、選択期間の始まりと共にメッセージセンターおよびメールでお知らせをお送り致します。 こちらのお知らせにクライアント・ポータル/アカウント・マネジメント内にある任意のコーポレートアクションツールを利用しての選択内容の送信方法が記載されていますので、こちらをご確認ください。
Q: 早期償還を選択することはできますか。
A: 満期となるポジションをお持ちのお客様には$500.00の手数料でETNを満期前に償還し、シリーズBまたは現金の引渡し（「早期償還」とみなされます）をお受取りいただく選択肢があります。満期時の償還にかかる費用はありません。
Q: 選択内容を取消すことはできますか。
A: 早期償還の選択を取消すことはできません。満期時の償還を選択される場合には、選択期間の終了時間まで選択を取消すことができます。
Q: IBKRでは現金とシリーズBのETNを組み合わせての償還を受付けていますか。
A: いいえ。選択はすべて現金、またはすべてシリーズBのETNのみで受付けております。
Q: 選択期限内に何も選択しなかった場合にはどうなりますか。
A: 期限内に選択が行われなかった場合、満期となるポジションは現金で償還されます。
Q: 最終取引日前に満期となるETNのショート・ポジションを保有していた場合にはどうなりますか。
A: 最終取引日前に満期となるETNのショート・ポジションを保有されていた場合、株式の貸し手にはショート・ポジションをクローズする権利があるため、現金またはシリーズB に相当する証券の引渡しが必要になります。引渡し可能なシリーズB 相当の証券のロング・ポジションをお持ちでないお客様にはショート・ポジションが割当てられ、ETNポジションの借入が不可能な場合にはポジションのクローズが必要になります。
Q: 最終取引日後に満期となるETNのショート・ポジションを保有していた場合にはどうなりますか。
A: 最終取引日後に満期となるETNのショート・ポジションを保有されていた場合、 現金の引渡しが必要になります。
Q: 今回の満期に関連する証拠金への影響はどのようになりますか。
A: ポートフォリオ・マージン口座に満期となるETNを保有されているお客様は、満期および償還の選択によるこちらのタイプの口座の必要証拠金への影響にお気をつけください。VXX、VXZおよび関連デリバティブ商品はすべてOCCのカスタマーポートフォリオ証拠金ファイルに含まれ、弊社はこれら商品をポートフォリオ証拠金として扱っておりますが、これら商品はOCCのポートフォリオ証拠金ファイルに含まれるものではなく、弊社もこれをポートフォリオ証拠金として扱っておりません。その代わりシリーズBのETNおよびデリバティブは、Reg.Tのルールに則って取扱われます。
このため現在ポートフォリオ証拠金としてVXXとVIXY、VIIX、UVXY、TVIX、SVXYなど、その他の短期ボラティリティ商品間で利用可能な証拠金の相殺は、VXXBに対してはご利用いただけません。同様に、VXZとVIXMやZIV など、その他の中期ボラティリティ商品間で利用可能な証拠金の相殺もご利用いただけません。またReg. Tでは限られた種類のオプション戦略のみに証拠金の利用が可能なため、VXXBやVXZBなどの複雑なオプション・ポジションをお持ちのお客様は、ポートフォリオ証拠金ルールの下にVXXおよびVXZに必要となる以上の必要証拠金の対象となる可能性があります。
VXXとVXZの満期および償還選択による影響は、リスク・ナビゲーター内の「仮想」ポートフォリオ機能を利用して予測することができます。
注意: 償還によって口座に証拠金不足が発生する場合、IBKRでは満期となるETNのシリーズBへの償還の禁止および現金償還の強制を行う権利を有します。
大麻を含める有価証券に関するクリアリングハウス規制
シュツットガルト証券取引所およびクリアストリームは、大麻およびその他の薬物商品に直接または間接的に関わることを主なビジネスとする発行者へのサービスを今後、行わないことを発表しました。 この変更により、シュツットガルト（SWB）およびフランクフルト（FWB）証券取引所での当該有価証券の取扱いがなくなります。2018年9月19日の終了時間より、IBKRでは以下の手段を講じます:
- 変更により影響を受けるポジションでお客様によるクローズのアクションがなく、また米国上場への移管対象にならないものを強制的にクローズする、また
- 影響を受けるポジションでお客様によるクローズのアクションがなく、 かつ移管対象となるものの強制移管を行う。
下記の表は2018年8月7日の時点でシュツットガルト証券取引所およびクリアストリームにより、影響を受けるとされる発行体であり、また米国上場への移管資格の有無も表示しています。クリアリングハウスによりますと、このリストには今後も追加があるものと見られているため、最新情報は各社のウェブサイトからの確認が推奨されます。
| ISIN | 名称 | 取引所 | 米国移管の可能性 | 米国シンボル |
| CA00258G1037 |
ABATTIS BIOCEUTICALS CORP |
FWB2 | 可能 |
ATTBF |
| CA05156X1087 |
AURORA CANNABIS INC |
FWB2, SWB2 | 可能 |
ACBFF |
| CA37956B1013 |
GLOBAL CANNABIS APPLICATIONS |
FWB2 | 可能 |
FUAPF |
| US3988451072 |
GROOVE BOTANICALS INC |
FWB | 可能 |
GRVE |
| US45408X3089 |
INDIA GLOBALIZATION CAPITAL |
FWB2, SWB2 | 可能 |
ICG |
| CA4576371062 |
INMED PHARMACEUTICALS INC |
FWB2 | 可能 |
IMLFF |
| CA53224Y1043 |
LIFESTYLE DELIVERY SYSTEMS I |
FWB2, SWB2 | 可能 |
LDSYF |
| CA56575M1086 |
MARAPHARM VENTURES INC |
FWB2, SWB2 | 可能 |
MRPHF |
| CA5768081096 |
MATICA ENTERPRISES INC |
FWB2, SWB2 | 可能 |
MQPXF |
| CA62987D1087 |
NAMASTE TECHNOLOGIES INC |
FWB2, SWB2 | 可能 |
NXTTF |
| CA63902L1004 |
NATURALLY SPLENDID ENT LTD |
FWB2, SWB2 | 可能 |
NSPDF |
| CA88166Y1007 |
TETRA BIO-PHARMA INC |
FWB2 | 可能 |
TBPMF |
| CA92347A1066 |
VERITAS PHARMA INC |
FWB2 | 可能 |
VRTHF |
| CA1377991023 |
CANNTAB THERAPEUTICS LTD |
FWB2 | 不可能 | |
| CA74737N1042 |
QUADRON CANNATECH CORP |
FWB2 | 不可能 | |
| CA84730M1023 |
SPEAKEASY CANNABIS CLUB LTD |
FWB2, SWB2 | 不可能 | |
| CA86860J1066 |
SUPREME CANNABIS CO INC/THE |
FWB2 | 不可能 | |
| CA92858L2021 |
VODIS PHARMACEUTICALS INC |
FWB2 | 不可能 |
重要な留意点:
- 米国上場は通常、店頭取引（PINK）され、ユーロではなく米ドル建てとなるため、マーケットリスクの他に為替レートのリスクが発生することにご注意ください。
- PINK Sheet有価証券を保有する口座保有者のお客様は、オープン注文を建てるにあたって米国（ペニー・ストック）の取引許可が必要になります。
- 米国（ペニー・ストック）の取引許可お持ちのお客様は、口座にログインする際に、二段階のログイン承認プロセスの使用が必要になります。
Clearinghouse Restrictions on Cannabis Securities
Boerse Stuttgart and Clearstream Banking have announced that they will no longer provide services for issues whose main business is connected directly or indirectly to cannabis and other narcotics products. Consequently, those securities will no longer trade on the Stuttgart (SWB) or Frankfurt (FWB) stock exchanges. Effective as of the 19 September 2018 close, IBKR will take the following actions:
- Force close any impacted positions which clients have not acted to close and that are not eligible for transfer to a U.S. listing; and
- Force transfer to a U.S. listing any impacted positions which clients have not acted to close and that are eligible for such transfer.
Outlined in the table below are impacted issues as announced by the Boerse Stuttgart and Clearstream Banking as of 7 August 2018. This table includes a notation as to whether the impacted issue is eligible for transfer to a U.S. listing. Note that the clearinghouses have indicated that this list may not yet be complete and clients are advised to review their respective websites for the most current information.
| ISIN | NAME | EXCHANGE | U.S. TRANSFER ELIGIBLE? | U.S. SYMBOL |
| CA00258G1037 |
ABATTIS BIOCEUTICALS CORP |
FWB2 | YES |
ATTBF |
| CA05156X1087 |
AURORA CANNABIS INC |
FWB2, SWB2 | YES |
ACBFF |
| CA37956B1013 |
GLOBAL CANNABIS APPLICATIONS |
FWB2 | YES |
FUAPF |
| US3988451072 |
GROOVE BOTANICALS INC |
FWB | YES |
GRVE |
| US45408X3089 |
INDIA GLOBALIZATION CAPITAL |
FWB2, SWB2 | YES |
ICG |
| CA4576371062 |
INMED PHARMACEUTICALS INC |
FWB2 | YES |
IMLFF |
| CA53224Y1043 |
LIFESTYLE DELIVERY SYSTEMS I |
FWB2, SWB2 | YES |
LDSYF |
| CA56575M1086 |
MARAPHARM VENTURES INC |
FWB2, SWB2 | YES |
MRPHF |
| CA5768081096 |
MATICA ENTERPRISES INC |
FWB2, SWB2 | YES |
MQPXF |
| CA62987D1087 |
NAMASTE TECHNOLOGIES INC |
FWB2, SWB2 | YES |
NXTTF |
| CA63902L1004 |
NATURALLY SPLENDID ENT LTD |
FWB2, SWB2 | YES |
NSPDF |
| CA88166Y1007 |
TETRA BIO-PHARMA INC |
FWB2 | YES |
TBPMF |
| CA92347A1066 |
VERITAS PHARMA INC |
FWB2 | YES |
VRTHF |
| CA1377991023 |
CANNTAB THERAPEUTICS LTD |
FWB2 | NO | |
| CA74737N1042 |
QUADRON CANNATECH CORP |
FWB2 | NO | |
| CA84730M1023 |
SPEAKEASY CANNABIS CLUB LTD |
FWB2, SWB2 | NO | |
| CA86860J1066 |
SUPREME CANNABIS CO INC/THE |
FWB2 | NO | |
| CA92858L2021 |
VODIS PHARMACEUTICALS INC |
FWB2 | NO |
IMPORTANT NOTES:
- Note that the U.S. listings generally trade over-the-counter (PINK) and are denominated in USD not EUR thereby exposing you to exchange rate risk in addition to market risk.
- Account holders maintaining PINK Sheet securities require United States (Penny Stocks) trading permissions in order to enter opening orders.
- All users on accounts maintaining United States (Penny Stocks) trading permissions are required use 2 Factor login protection when logging into the account.
SMAとそのしくみ
概観:
SMAとは「Special Memorandum Account」のことです。この口座に保有されるのは株式や現金ではなく、Reg. Tの信用取引口座にある有価証券の時価が上昇したときに発生する信用枠を指します。SMAの目的は含み益による次の買い付けのために買付力を維持することにあります。これができない場合には次の買付の際に余剰の株式を取りくずして資金化することになるため、SMAは安定した口座価値を維持し、不必要な資金調達取引を最小限に抑えるのに役立ちます。
有価証券の価値が上昇するとSMAも上昇しますが、 有価証券の価値が下がる場合でもSMAが下がることはありません。SMAが減少するのは有価証券を購入したり現金を引き出す場合のみであり、SMAの使用に関する唯一の制限は、追加の購入や引出しによって口座が維持証拠金額の要件を下回らないことになります。SMAを増加させる取引には、現金預金、受取利息、または受取配当金（1ドル単位）、有価証券の売却（純収入の50%）などがあります。注意すべき点は、SMA残高は過去の記帳項目をすべてを集計したものであり、口座開設時からの残高に影響を与えるということです。長期間分の大量のエントリーが含まれているため、日々のアクティビティステートメントから現在のSMAのレベルを計算し確認することは、可能ではあるものの現実的には困難です。
SMAがどのように機能するか、例を使って考えてみます。ある口座保有者が$5,000を入金し、ローンバリューが50%の有価証券を$10,000購入したと仮定します（または必要証拠金が1-ローンバリュー、または50%に等しいとします）。この場合、口座開設前と開設後の値は以下のようになります:
|
項目
|
詳細
|
イベント1 - 初回入金
|
イベント2 - 株式購入
|
|
A.
|
キャッシュ
|
$5,000
|
($5,000)
|
|
B.
|
ロング株式市場価格
|
$0
|
$10,000
|
|
C.
|
流動性総資産/EWL* (A + B)
|
$5,000
|
$5,000
|
|
D.
|
委託証拠金（B * 50%）
|
$0
|
$5,000
|
|
E
|
委託証拠金余力（C - D）
|
$5,000
|
$0
|
|
F.
|
SMA
|
$5,000
|
$0
|
|
G.
|
購買力
|
$10,000
|
$0
|
次に、買い持ち銘柄の価値が$12,000に上昇したとします。この$2,000の市場価格の上昇により、$1,000のSMAが発生し、口座保有者は次のうちのいずれかが可能となります: 1）追加の資金を預けることなく、50%の証拠金率を想定して$2,000の価値のある有価証券を追加で購入する。または、2）現金で$1,000を引出す（口座に現金がない場合には、借方の残高を増やすことで資金を調達することができます）。以下をご覧ください:
|
項目
|
詳細
|
イベント2 – 株式購入
|
イベント3 - 株価上昇
|
|
A.
|
キャッシュ
|
($5,000)
|
($5,000)
|
|
B.
|
ロング株式市場価格
|
$10,000
|
$12,000
|
|
C.
|
流動性総資産/EWL* (A + B)
|
$5,000
|
$7,000
|
|
D.
|
委託証拠金（B * 50%）
|
$5,000
|
$6,000
|
|
E
|
委託証拠金余力（C - D）
|
$0
|
$1,000
|
|
F.
|
SMA
|
$0
|
$1,000
|
|
G.
|
購買力
|
$0
|
$2,000
|
*EWLは貸付金額を含む資産価値のことであり、この例では流動性資産を指します。
SMAはReg. Tに基づく考え方です。IB LLCの証券口座がオーバーナイトの必要証拠金を遵守していることを確認するために使用されるものであり、日中やオーバーナイトの維持証拠金に対する遵守の確認をするためには使用されません。また、コモディティ口座の証拠金遵守の確認に使用されることもありません。同様に、オーバーナイトつまりReg. T必要証拠金が必要となる時間（米国東部標準時15:50）にSMAがマイナスである口座は、Reg. T必要証拠金遵守のため、ポジションの強制決済の対象となります。
China Connect Northbound Investor ID Model
Background
In November 2017, the Securities and Futures Commission (SFC) and China Securities Regulatory Commission (CSRC) announced an agreement to introduce an investor identification regime for Northbound trading under Mainland-Hong Kong Stock Connect. This regime is intended to enhance regulatory surveillance of mainland-listed stock trading from Hong Kong and requires brokers to report the identity of clients submitting orders to either the Shanghai or Shenzhen Stock Exchange. This regulation will be effective as of September 26, 2018. Additional information is provided in the series of FAQs below.
In November 2017, the Securities and Futures Commission (SFC) and China Securities Regulatory Commission (CSRC) announced an agreement to introduce an investor identification regime for Northbound trading under Mainland-Hong Kong Stock Connect. This regime is intended to enhance regulatory surveillance of mainland-listed stock trading from Hong Kong and requires brokers to report the identity of clients submitting orders to either the Shanghai or Shenzhen Stock Exchange. This regulation will be effective as of September 26, 2018. Additional information is provided in the series of FAQs below.
What is the Stock Connect?
The Stock Connect is a collaboration between the Hong Kong, Shanghai and Shenzhen Stock Exchanges which allows international and Mainland Chinese investors to trade securities in each other's markets through the trading and clearing facilities of their home exchange.
The Stock Connect is a collaboration between the Hong Kong, Shanghai and Shenzhen Stock Exchanges which allows international and Mainland Chinese investors to trade securities in each other's markets through the trading and clearing facilities of their home exchange.
What is Northbound trading?
Northbound trading refers to the trading of mainland-listed stocks (e.g., Shanghai and Shenzhen Stock Exchanges) from the Hong Kong Stock Exchange.
Northbound trading refers to the trading of mainland-listed stocks (e.g., Shanghai and Shenzhen Stock Exchanges) from the Hong Kong Stock Exchange.
What information is being collected and reported?
The information collected and reported depends upon the client classification. In the case of individuals, the information is as follows:
The information collected and reported depends upon the client classification. In the case of individuals, the information is as follows:
- Name in English and Chinese
- ID issuing country/jurisdiction
- ID type (Hong Kong ID card, ID card issued by the government authority of relevant country/region, passport, or any other official identity document e.g. driver's license)
- ID number (number of ID document)
For Institutional investors, the information is as follows:
- Entity name
- Other official incorporation documents (IBKR will attempt to us the documents clients provided at the point of account opening, whenever possible).
- Legal Entity Identifier (if you do not already have an LEI, you can order one through IBKR when requesting trading permissions for China Connect. Note that obtaining a LEI can take up to three days, is associated with an application fee imposed by the LEI issuing organization, and an annual renewal fee thereafter).
Each Northbound trading client will be assigned a Broker-to-Client Assigned Number (BCAN) which will be associated with the identification information collected and will be tagged to every Northbound order on a real-time basis.
Who is IBKR authorized to share this information with?
Clients who wish to access the Stock Connect must provide IBKR with consent to provide their information to the Hong Kong Exchanges and Clearing Ltd and the Chinese regulatory bodies such as:
Clients who wish to access the Stock Connect must provide IBKR with consent to provide their information to the Hong Kong Exchanges and Clearing Ltd and the Chinese regulatory bodies such as:
- Shanghai and Shenzhen Stock Exchanges
- China Securities Depository and Clearing (Hong Kong) Company Limited
- Mainland regulatory authorities and law enforcement agencies
How will IBKR collect this information?
Clients with existing Northbound trading permissions will be presented with the online form upon log in to Client Portal. This form will allow IBKR to collect the required information and consent to submit this information upon order submission.
Clients with existing Northbound trading permissions will be presented with the online form upon log in to Client Portal. This form will allow IBKR to collect the required information and consent to submit this information upon order submission.
When will the identification take place?
The Northbound Investor ID model will be effective as of October 22, 2018.
The Northbound Investor ID model will be effective as of October 22, 2018.
Will there be a Southbound Investor ID model?
The SFC and the CSRC also agreed to introduce a similar investor identification regime for Southbound trading as soon as possible after the regime for Northbound trading is implemented.
The SFC and the CSRC also agreed to introduce a similar investor identification regime for Southbound trading as soon as possible after the regime for Northbound trading is implemented.
What happens if I do not provide the required information?
Once the Northbound Investor ID model is in effect, clients who either fail to provide the required information or elect not to provide consent to report the required information will not be allowed to submit opening Northbound orders but will be allowed to close existing positions.
Once the Northbound Investor ID model is in effect, clients who either fail to provide the required information or elect not to provide consent to report the required information will not be allowed to submit opening Northbound orders but will be allowed to close existing positions.
How can I trade China Connect Stocks?
In order to trade China Connect stocks clients are required to login to Client Portal and request the necessary trading permissions. To do so:
In order to trade China Connect stocks clients are required to login to Client Portal and request the necessary trading permissions. To do so:
- Log into Client Portal
- Click the User menu (head and shoulders icon in the top right corner) followed by Manage Account
- If you manage multiple accounts, select an account by clicking on the account number to popup the Account Selector
- Click the Configure (gear) icon next to Trading Experience & Permissions
- Click on "Stocks" and check the box next to "Hong Kong/China Stock Connect"
- Click CONTINUE and follow the prompts on screen.
After the trading permission has been requested clients will be prompted with the Northbound Trader Disclosure. Once consent has been given, IBKR will assign a BCAN and send the client file to the HKEX before the deadline at 2:45pm HKT. If the request has been approved, clients will be able to trade on the next day.
Utilization in the Securities Lending Market
Utilization Metrics
Utilization is defined as loaned shares divided by available shares in the securities lending market, expressed as a percentage. The Utilization metric on TWS is not specific to IB. It is based on industrywide data provided by a securities finance data vendor. The metric is not conclusive however, as not every lender reports their Utilization to the vendor. In addition, although the source is believed to be reliable, IBKR does not warrant its accuracy.
Generally, Utilization is the ratio of demand to supply. For example, Apple Inc. (AAPL) may have utilization of less than 1% because the stock has vast availability relative to the demand to borrow shares for shorting. Roku Inc. (ROKU) may have utilization above 90% because of higher demand to short shares as compared to the number of available shares.
For accounts enrolled in the Stock Yield Enhancement Program, a high stock-specific Utilization percentage may increase the likelihood that IB may be able to lend your shares. Conversely, stocks with a low Utilization percentage are generally in lesser demand in the securities finance market, generally reducing IB’s ability to lend your shares.
Utilization can be added as a column in TWS.
Using Mosaic Market Scanner to Determine an Indication of Stock Utilization
TWS users can find stock utilization indications by using Mosaic Market Scanner filters. After opening the scanner, Select Custom Scanner and input parameters. Some useful filters include Price, Market Cap, Fee Rate and Utilization.
Please also see Important Considerations and Risks of Participating in Interactive Brokers Fully-Paid Securities Lending Programs here.
