Margins in Foreign Markets
Posted: Fri Feb 24, 2006 7:03 pm
Tim or TBB users,
How does TBB handle margins for positions held in foreign markets?
(1) It assumes that the equivalent amount in USD is actually converted into a local currency when the position is opened and then converted back into USD when the position is closed.
OR
(2) It puts up the equivalent amount in USD for margin but without actually converting it into a local currency.
In other words, which of the two scenarios described in Question #4 in this post would be adopted by TBB? And how do brokers usually handle this issue in real life?
How does TBB handle margins for positions held in foreign markets?
(1) It assumes that the equivalent amount in USD is actually converted into a local currency when the position is opened and then converted back into USD when the position is closed.
OR
(2) It puts up the equivalent amount in USD for margin but without actually converting it into a local currency.
In other words, which of the two scenarios described in Question #4 in this post would be adopted by TBB? And how do brokers usually handle this issue in real life?