Just curious, what maintenance margin do IBKR/Ameritrade require for this box spread?
I suppose they might depend on the nature of the collateral, so let’s assume my collateral is 100% SPX.
i.e. if I were to max out the box spread loan amount, what’s the maximum percentage that my collateral could drop before IBKR issues the margin call?
This trick gives an interesting way to borrow money for cheap, and I could imagine other uses for it than CD deposits.
The article gives the impression that the only use one can make of the box spread trick is to invest the proceeds in a CD. But one could as well invest them in crypto or to fix their house, etc. Now regardless of the use the borrower chooses, it’s their responsibility to make sure they can still repay it soon in case of margin call. I can think of at least 3 ways other than CDs that accomplish this.