This is something very odd I am not sure I understand correctly. I attach the screenshot I got from Saxo.
When I try to buy PCN (Pimco Corporate Income Fund) at Saxo, I think what happens is that Saxo lends me money to buy this position (even though I have much more cash than I am trying to buy PCN for). Looking at the screenshot, I am trying to buy PCN for $9,842. In addition to taking out $9,842 from my account, Saxo is taking out another $9,821 as "Maintenance margin impact" which is the "Margin required to maintain the open position", and charging me $1.18 a day, which sums up to $430.7 a year, or a whooping 4.38% of my investment. Bloody hell. Am I reading this right??
I know that PCN is leveraged, but it's leveraged at 38.04%, not at 100%. Anyway, even if PCN goes belly up, I wouldn't lose more than 100% of my investment, so why do they take a "Maintenance margin impact", and why they charge me money? I asked the question about the "Maintenance margin impact", and they replied as for the second screenshot below. So they haven't made a mistake. It's just the way they operate, but it's very weird indeed!
I bought the same CEF with BOCHK, and I don't recall any the "Maintenance margin impact", and the charges. But maybe because I was living in HK, and this is (again) some kind of European requirement? Does IB operate in the same manner as Saxo??
Thank you very much!