AMP Margin for Positions opened in night times

Show me a broker or FCM that sent out margin calls during the move down. The only reason not many FCMs and brokers went under was because the market came straight back up. Nothing of that changes the fact that many accounts had been blown out had the market stayed at those low levels.

algofy said:
Do you enjoy spreading misinformation @Zzzz1 ??


Where is this "liquidity gap"?
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I traded more futures contract than you will trade for the rest of your life. Most all were hedges for various options books during many years of trading at Bank prop desks and hedge funds. I actually have no idea whether my futures trades alone were net profitable or not. I can only talk about my overall pnl.

J.P. said:
@Zzzz1 you sound like a very jealous failed futures trader.
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Zzzz1 said:
I traded more futures contract than you will trade for the rest of your life. Most all were hedges for various options books during many years of trading at Bank prop desks and hedge funds. I actually have no idea whether my futures trades alone were net profitable or not. I can only talk about my overall pnl.
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So you are confirming that you ARE a jealous failed futures trader. LOL. I knew it! 'Nough said.
 
You can open an account at AMP with $500 and trade the ES round the clock with $400 maint. Good to know that you could gather enough on a weekend via pan handling to trade the ES levered up at well over 100:1 (99.7% leverage) and try to get rich. The 1929 crash had up to 90% margin/leverage - hence the crash.
 
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comagnum said:
You can open an account at AMP with $500 and trade the ES round the clock with $400 maint - LOL.
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And what's wrong with giving the little guy a chance? Make the barrier to entry low and let the trader bootstrap a small account into a slightly bigger account and rinse repeat.
 
Nothing against the small traders - Futures trading has been lowering the bar as far as entry cost and giving massive leverage at rates that would seemed unimaginable not that long ago. The up side of this is aspiring traders operating on minimal requirements will not lose very much. Major market tops are always marked when margin/leverage are ate historical extremes, the subsequent market melt downs are attributed to this leverage which is what my first post was about.
 
AMP_Trading said:
Yes, AMP runs 24 hour Risk Management App. It will trigger an auto-liquidation if daily account balance loss reaches 80%. It will trigger a market order to attempt to liquidate any open positions and cancel any working orders, so like our customers, we are at the mercy of the market for the actual fill price.

Disclaimer: This does not guarantee to protect against debit balance. Clients are responsible for monitoring their positions and are financially responsible for any losses generated by open positions in the account.
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Zzzz1 said:
The right thing to do would be to require a reasonable margin at all times. No exceptions, no day session, no night session. Robert, you are perfectly aware and know that this whole concept of day and night session is totally out-dated and does not reflect reality anymore, don't you? In fact, most international index futures contracts on almost every exchange are traded well beyond the local day session, only. Whether CME, Osaka/Tokyo, Hong Kong, Korea, Singapore, Australia,...hence making a difference between a day session and night session makes zero sense and should be abolished. Again, this is only something the US exchanges hold onto. But hey, let's assume they keep it unchanged.

Keep in mind, the past has shown that flash crashes or global event risk does not care whatsoever whether the US is currently in an exchange day session or not, meaning, you as trader and you as FCM are exposed to such event risk at any time, day and night. Hence, it makes zero sense to charge different margin as function of day or night session.

500 dollars for 1 ES contract is way too low, no matter how you argue. I say that because a 100 point move in ES, something we did in fact witness several times before would hit you with around 5000 USD. During the flash crash SPX sold off 7% within 15 minutes with hardly a single bid in the market. That would today translate into a 160 point loss without even the slightest chance to get out of the position. In light of that you still believe a 500 dollar margin is sufficient?

You alluded to the point where you ask how an FCM is to attract customers. Well, you do know I am highly critical of the benefit of FCMs. I do not see after all where you guys add much value at all in this whole equation. You basically suggest your value added right now is to provide artificially low margin, exposing clients and even your risk prudent customers to elevated risk. But my FCM criticism aside, at least you can be honest in that you are very clearly fishing for undercapitalized traders, and yes charging 5000 dollars for 1 ES contract will not be very competitive in that specific regards. (But it will be the prudent thing to do in order to withstand the next Black Swan).

Summary: You perfectly proved my point with your previous post. I know you cannot say it, but in fact you said it: FCMs provide very little benefit or value added, beyond providing undercapitalized traders with low upfront payment to swing larger positions. The reaper is waiting around the corner, the next flash crash will again take with it a number players who engaged in this game. It is simply not healthy nor prudent in a well functioning financial industry to have such players around. Unfortunately those who regulate are either clueless, have their interests aligned with brokers/FCMs/IBanks, are completely behind the curve, or a combination thereof.
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Yes proffessor, a lot of people like to use lower margins and amp(and others) likes business and commission... the more you know...huh?
 
I called CME risk-management about this to clarify. The rep told me (paraphrasing)..."The requirement to get into a future contract is the maintenance margin of that contract. If it is a non-hedge/non-member account, it's the initial, which is 10% more. There is no such thing as DT margin at the CME."

This leads me to believe that a broker offering a $500 DT margin for a contract, say ES, which is $5,225 for the initial, is requiring $500 of the speculator's account money, and the non-hedge/non-member FCM is putting up $4,725 of money from their own "accounts" to cover the position.

So a broker who is helping to cover a traders' costs to initiate a position (hence the term "initial margin"), is taking on risks of their own.

I don't understand the FCM business, and don't shoot the messenger. This is what the rep said in a nutshell.

The summary that we all forget is here---> http://www.cmegroup.com/clearing/cme-clearing-overview/performance-bonds.html

This leads me to a conclusion. Always trade only what you can to meet the initial per contract, regardless of what your broker says you can or cannot do, if neither you nor your broker wish to suffer any major surprises in the rare "flash-crash" scenario. WITH THAT SAID however, that does not mean that low DT margins are not profitable for any one particular broker.

That business model must be working, or else it would not be used at all by anyone. Makes sense, yes?
 
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