Confusion: Received Urgent Liquidation Warning for My Cash Account
Edit 2024/11/11
It seems the case has been solved. IBKR sent me the following response to my ticket. It does appear that whenever the excess liquidty is lower than 10% a courtesy warning is sent, and because my cash deposit is so low (less than 1%) relative to my net liquidty the warning became URGENT. I have made a deposit to juke up the cash amount, though I am still not planning to do 10% idle cash in IBKR for now.
Edit 2024/11/10
The situation becomes a bit more confusing now. The liquidation warning somehow disappeared from the notification page of my account. On the other hand, I saw a warning with low cash balance issued yesterday (2024/11/9). From the time stamp, it seems the low cash balance warning came after the liquidation warning, and the reasons listed might be related to the liquidation warning. Was it a system mistake that the liquidation warning was issued first then it was corrected to a low cash balance warning? And I need to find out what money I owe excatly and how much. I have sent a ticket to IBKR for inquiry and will keep this post updated.
This morning (Saturday Nov.9) I was checking my IBKR account and I saw this URGENT warning:
My basic situation: living in an EU country, trading with EUR, account is cash account, €27.6K in assets (ETFs, mutual funds, stocks), €24.50 in cash. I have attached the symbols and the BALANCE page of my account on desktop.
I understand this topic has been discussed many times in this subreddit, and I have browsed through many posts, so I have a basic idea of what it means. But I am still confused as why I am receiving this warning.
-All my assets are purchased with settled cash deposit in full, and I am sure none of them involve any margin or options contract. I did try to apply for a margin account, but because I did not hold enough equity in my account (€50,000 or $50,000?) my application was rejected. I have no intention of increasing my equity so far.
-Some posts also suggest this might be due to the need to pay for market data subscriptions. I have checked my market data subscription and I am sure I only subscribed to free data.
-I also understand that this could happen if the cash available is extremely low. I admit that I am holding a very thin cash deposit (less than 0.1%) relative to my equities, but if this is a cash account and I do not hold any margin/options positions, I should not worry about how little cash I have? Should I deposit more funds?
-From another perspective, this warning was sent 16 hours ago meaning it should have been sent to me on Friday Nov.8 during trading hours, but I have carefully checked my positions and I do not see any liquidation without my knowledge. And it seems if an URGENT warning was issued, typically the liquidation would happen shortly thereafter. So I might have gotten away with it somehow?
Many thanks in advance! Best of luck with your trades and have a great weekend.