Dukascopy, Oanda covers loses who is next?

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Snbmess

Dukascopy covers negative balances, ensuring security for all customers. Dukascopy Bank and Dukascopy Europe invite all the industry to follow the same approach to build up customers trust in the industry.
 
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Got email from Hotforex that they reimbursed losses as well. I think it's a rule of thumb among big brokers and aimed on saving the loyalty of clients suffered wipeout..
 
They prob had opposite positions in their market making book and are willing to "spread the wealth" to get customer market share. Odds are they won't do it again and it also means that your capital is at a firm more like MF global than Charles Schwab.
 
newwurldmn said:
They prob had opposite positions in their market making book and are willing to "spread the wealth" to get customer market share. Odds are they won't do it again and it also means that your capital is at a firm more like MF global than Charles Schwab.
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Still doesn't add up. If you're paying out those who were long CHF, but forgiving those who were short it...
 
it may an inevitable event, any would fall as victim, while I just got another Tickmill announced about their readiness to buy client portfolios and assets of FX brokers who have run into difficulties due to recent market events related to record Swiss Franc volatility.
official announcement on their website : http://www.tickmill.com/company-news/tickmill-seeking-acquire-client-portfolios-fx-brokers/
how anyone see this, thought this could be another better solution for any traders who face difficulties, negative balance, any legal act from brokers who chasing their own client for a unreasonable debt. been read at many forum about those kind of issue, even some member ask for help to reform lawyers support.
 
Just FYI, unlike Dukascopy which is making a graceful (and presumably expensive) gesture here to preserve retail trader confidence, market makers like Oanda, FxPro and FXCM have forgiven negative balances because their user agreements say so explicitly.

Oanda - Point 15 (also seen in USA and Europe versions):
Maximum Losses. OANDA warrants and represents that the fxTrade System has been designed so that your total aggregate Realized Loss can never exceed the sum of the total aggregate deposits made to your Account and your total aggregate Realized Profit.
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FXCM, interestingly they seem to have written to clients with negative balances asking to pay up. However, informed clients will know they can simply refuse to pay, because among other places, http://www.fxcm.com/legal/trading-execution-risks/ under "Marign Calls and Closeouts" describes the CHF scenario:
account equity can fall below margin requirements at the time orders are filled, even to the point where account equity becomes negative. This is especially true during market gaps or volatile periods. FXCM will not hold traders responsible for deficit balances in this scenario, but clients should be cognizant that all funds on deposit in an account are subject to loss.
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There's an interesting essay on Seeking Alpha about possible legal ways FXCM might manage to collect though.

FxPro - Point 5.1 is the clearest of the three:
[...]However, it should be noted that FxPro operates on a 'negative balance protection' basis; this means that the client cannot lose more than his/her initial investment.
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Tsing Tao said:
Still doesn't add up. If you're paying out those who were long CHF, but forgiving those who were short it...
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It adds up to great profit for the shop. Those losing will always overwhelm those who win. That's the only direction the market can move.
 
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