How to actually flatten IB paper account to base currency
I hesitate to ask this question here of experienced IB users since it's apparently one of life's greater mysteries, oft asked, apparently never answered (at least never by IB or NT support having tilted at both windmills on occasion over the last few years, nor on the Interwebz at large), but would rather be thought a fool for 5 minutes for having asked it that remain a fool forever if I don't (Chinese proverb).
Namely, why after resetting an IB paper account with no active Forex positions, does
1. the Net Liquidation Value (under Balances in the Account statement) approximate the requested reset balance with various margins (maintenance, overnight, etc) set to zero and no open positions, as naively expected; yet,
2. Market Value of the account show positions in various currencies that cause its Net Liquidation Value to fluctuate with changes with respect to the account's base currency, as might be expected if one had open foreign/base currency positions; yet,
3.1 to reiterate, no positions are active according to the TWS FX portfolio or NT; and,
3.2 closing the non-base positions (converting to base currency) via either TWS or via NT to show zero (or very small) Market Value of foreign currency positions creates (opens & fills) active "opposite" orders in the foreign/base currency pairs that also show as open positions in e.g. Ninjatrader, consuming margin as might be expected of open positions and fluctuating as each foreign/base currency pair value changes; but mysteriously,
4. Does in fact stabilize the account's Net Liquidation value; yet,
5. Subsequently flattening these brave new open positions via e.g. Ninjatrader or TWS, to avoid, say, apparently losing money hand over fist when the foreign/base currency pair is moving against you, resets the account to Step 1; e.g.,
5.1 with substantial Market Value in non-base currencies causing fluctuating (e.g., rapidly dropping) account Net Liquidation value
5.2 no open positions
In other words, how does one actually reset an IB paper account?
Last edited by bnichols; November 4th, 2011 at 06:53 AM.
Roger & thanks -- one would think so; however that's where the problem starts.
I think what I'll try is
1. flatten the account; then,
2. close all non-base currency positions. This will create new active foreign/base currency positions that will cause Net Liquidation value to fluctuate but will zero the Market Value of foreign positions;
3. request IB reset the account; and then,
4. sit on my hands until the request is processed (sometime tonight).
Last edited by bnichols; November 4th, 2011 at 07:12 AM.
Suddenly twigged to the fact that "open positions" that have no Market Value, don't consume margin and don't affect Net Liquidation Value, that NT nevertheless interprets as active positions (and hence confuse bots), yet when closed are transformed into actual currency positions in the account, are in reality IB style Virtual Positions.
To get rid of them
1. open the Account window in TWS,
2. select an open position in the FX Portfolio window by right-clicking on it,
3. click on "Adjust Position or Average Price" in the resulting popup menu
4. set the position to zero in the Adjust Position or Average Price window that appears
5. click OK
When accounts are reconciled at the end of the day these zero positions will disappear from the FX Portfolio section of the Account.
ETA: to mark this question as answered it may be someone other than the OP has to propose it. If so, if someone wants to suggest the above as the answer by quoting this post I will be happy to mark your reply as Answering the Question and thereby bestow on you whatever kudos go along with that
Last edited by bnichols; November 9th, 2011 at 10:58 AM.