Stop your whining, you're the "other side" as you said before so you have nothing to worry about. These sorts of moves are good, just like the flash crash as they show you the ultimate risk out there, currencies were attracting too many people that shouldn't be near trading anyway.
CHF mess
- Thread starter TraDaToR
- Start date
Stop your whining, you're the "other side" as you said before so you have nothing to worry about. These sorts of moves are good, just like the flash crash as they show you the ultimate risk out there, currencies were attracting too many people that shouldn't be near trading anyway.
LOL
If you applied some thinking - the math shown works for both parties - even if brokers offered max 4:1 leverage, 100% equity of brokers equity would be wiped out on a "black swan" 30% move (actually 40+ % on EURCHF)
Not a viable business model. No retail punter (small a/c size) would ever trade FX on maximum 4x leverage
If you applied some thinking - the math shown works for both parties - even if brokers offered max 4:1 leverage, 100% equity of brokers equity would be wiped out on a "black swan" 30% move (actually 40+ % on EURCHF)
Not a viable business model. No retail punter (small a/c size) would ever trade FX on maximum 4x leverage
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You and I are arguing the same point, but apparently you're not understanding me.
I was making a broad point, that this is a good reminder that the entire system is fragile. This is why I keep 80% of my money in mutual funds because I am not interested in seeing my entire net worth vanish because a rogue CB makes a move like this and blows up my futures broker.
All brokers offering leverage are somewhat risky, but if you can't see that forex retail bucket shops offering 200-to-1 + is more risky than.
I was just about to consolidate by merging an account with Vanguard into my IB futures account, but this is a good wake up call that account diversity is important.
personally, I was short EUR/NZD and won 408 pips in half an hour. but I do have a lot of sympathy for all who lost. the EUR/CHF trade appeared to be safe - like a call option that could never go under 1,20. things like yesterday must not happen at any rate.
what a bunch of buggers at the SNB! sending half a dozen brokers out of business and killing retails accounts en masse. and they even made huge profits themselves errr their wives made that. unreal world!
everyone will and should unless they themselves go brankrupt and or the customer is too stupid to sue.
9259 posts and 8 likes (2 of which you earned on this post, one of which came from me) is sick ;-) But I liked the reminder of Hildebrandt's wife who afforded herself a nice shopping spree after she traded a boatload off the tip-off by her hubby pre-preg-announcement. Funny world.
that is a bollocks line of argument. Don't throw all issues in one bucket. The problem here is
a) a ridiculously stupid Central Bank decision [they pretty much lost all and every last bit of credibility for years, think about how every last Fed and CB watcher is sucking the tits of central bankers and spends all their waking hours to interpret each and every single word and what it might mean for interest rates in 6-12 months ahead. And then a bank comes along and kicks up its own currency by 40%. WOW. So much to logic, careful assessment of subsequent reactions, and bestowing confidence in the market].
b) Brokers that offer insane leverage. Those shops deserve to go under, bankrupt, dead, gone. I hope FXCM will go under, they totally deserve it. I hope Niv will lose each and every last penny which he stole for years through illegal and unethical business practices. He only got away with it because either his lawyers buried small investor law suits/arbitrations or because the affected party could not prove wrongdoing beyond reasonable doubt.
c) Sure there are many people who should never risk their savings/income/free cash flow (or even worse debt they take on in order to finance their gambling addiction). But that has nothing to do with anyone on the trading/investment side who lost money regarding this issue. Even some long-term currency veterans took a beating.
a) a ridiculously stupid Central Bank decision [they pretty much lost all and every last bit of credibility for years, think about how every last Fed and CB watcher is sucking the tits of central bankers and spends all their waking hours to interpret each and every single word and what it might mean for interest rates in 6-12 months ahead. And then a bank comes along and kicks up its own currency by 40%. WOW. So much to logic, careful assessment of subsequent reactions, and bestowing confidence in the market].
b) Brokers that offer insane leverage. Those shops deserve to go under, bankrupt, dead, gone. I hope FXCM will go under, they totally deserve it. I hope Niv will lose each and every last penny which he stole for years through illegal and unethical business practices. He only got away with it because either his lawyers buried small investor law suits/arbitrations or because the affected party could not prove wrongdoing beyond reasonable doubt.
c) Sure there are many people who should never risk their savings/income/free cash flow (or even worse debt they take on in order to finance their gambling addiction). But that has nothing to do with anyone on the trading/investment side who lost money regarding this issue. Even some long-term currency veterans took a beating.
"b) Brokers that offer insane leverage. Those shops deserve to go under, bankrupt, dead, gone."
CHF gained 30% to 50% on its peak level, depending on the fx pair. So everybody trading with (more than) 2x leverage would have his account blown up if he was on the wrong side. Basically you recommend shutting all brokers who offer leverage for forex trading. And you still call this trading?
CHF gained 30% to 50% on its peak level, depending on the fx pair. So everybody trading with (more than) 2x leverage would have his account blown up if he was on the wrong side. Basically you recommend shutting all brokers who offer leverage for forex trading. And you still call this trading?
Nope, not accurate. You can only choose either OR:
a) Either your execution provider showed prices and let you submit orders and he filled you despite the fact that spreads would have been very wide. In this case anyone could have liquidated their long positions in eurchf long before the move started to threaten your survival. Please keep in mind trading at 10:1 or even 50:1 leverage is no problem, the problem is when you trade at 50:1 leveraged to your account balance. In any case, anyone could have exited their under-water position.
OR
b) Your broker did not show prices and did not execute anyone on the way down. In that case they cannot come back later on and claim that they filled a client at some worst-possible-price level. And this precise point will be debated in numerous law courts and arbitration panels.
Either you offer execution capabilities or you dont, but if you dont you cant come back and tell clients they got filled at some miraculous price. I mean, of course Cyprus and Russian based brokers with thug backup on-call can do that but not a reputable broker and not without legal repercussions.
a) Either your execution provider showed prices and let you submit orders and he filled you despite the fact that spreads would have been very wide. In this case anyone could have liquidated their long positions in eurchf long before the move started to threaten your survival. Please keep in mind trading at 10:1 or even 50:1 leverage is no problem, the problem is when you trade at 50:1 leveraged to your account balance. In any case, anyone could have exited their under-water position.
OR
b) Your broker did not show prices and did not execute anyone on the way down. In that case they cannot come back later on and claim that they filled a client at some worst-possible-price level. And this precise point will be debated in numerous law courts and arbitration panels.
Either you offer execution capabilities or you dont, but if you dont you cant come back and tell clients they got filled at some miraculous price. I mean, of course Cyprus and Russian based brokers with thug backup on-call can do that but not a reputable broker and not without legal repercussions.