EUR/CHF wipeout/margin call ... negative balance ... what to do?

lucysparabola · Jan 21, 2015

no, Alpari positive accounts should all be fine. they're segregated.

i960 · Jan 21, 2015

newwurldmn said:
At the end of the day the only speculator class that got walloped by this was the retail guys. They were the only ones running stupid leverage. All fx retail traders should think about that. If the well informed hedgefunds aren't trading so big, why are they ?

Definitely not true. Quite a few funds and institutionals got their faces kicked in as well. Irresponsible timing by the SNB IMO, but it still seems like a nickels/steamroller setup.

ronblack · Jan 21, 2015

SNB did the right thing to protect the interests of the Swiss people given that the ECB will debase the euro with QE. Jim Rogers has warned speculators of this development long ago.

freedinner · Jan 21, 2015

Turveyd said:
Dont think FXCM are wiping out negatives, guaranteed SLs was many years ago.

http://www.fxcmasia.com/docs_pdfs/the_truth_about_forex_trading_guide.pdf

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5. Can I lose more money than I deposit with you?

Many forex traders use a lot of leverage, and so run the risk of losing more money than they have in their account. If this happens, your account can have a negative balance, often called a “debit balance”. In this case, you will owe money to your broker, and the broker may call in collections agencies or engage in legal action to recover the money you owe it.

FXCM doesn’t think that’s very fair. We operate with a No Debit Balance Guarantee. If your losses become too large, our system will automatically liquidate all open positions immediately at the best available price. Typically, the system can get you out before your account would become negative. In the rare case where it cannot, FXCM will credit your account back to zero. You can never owe FXCM money due to trading losses
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freedinner · Jan 21, 2015

BTW thats the ad I see on this thread from FXCM. Mentions "risk to lose all deposited funds". Does not mention risks beyond that.

Turveyd · Jan 21, 2015

freedinner said:
http://www.fxcmasia.com/docs_pdfs/the_truth_about_forex_trading_guide.pdf

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5. Can I lose more money than I deposit with you?

Many forex traders use a lot of leverage, and so run the risk of losing more money than they have in their account. If this happens, your account can have a negative balance, often called a “debit balance”. In this case, you will owe money to your broker, and the broker may call in collections agencies or engage in legal action to recover the money you owe it.

FXCM doesn’t think that’s very fair. We operate with a No Debit Balance Guarantee. If your losses become too large, our system will automatically liquidate all open positions immediately at the best available price. Typically, the system can get you out before your account would become negative. In the rare case where it cannot, FXCM will credit your account back to zero. You can never owe FXCM money due to trading losses
---------

Nice, I was nit aware of this, still a zero account but better.

If I was aware if this and chf pegging I'd of took account back to 1k bet hard on EC short dratttss.

Thats nice to know as I am with fxcm, thanks

newwurldmn · Jan 21, 2015

The fund was a 900mm fund and traded a very volatile strategy. He's the only casualty.

The bank pnls while large are within the black swan type pnl profile of a typical Sellside desk. Their bonuses will be hurt but nothing as large as the whale trade at JPM or other famous blowups.

It's primarily retail who was punting in large enough to blow up.

Turveyd said:
Errr not true, several UK banks too large hits, big investor worth 2.9bil lost his main fund and is giving up trading, sure there are others.

Retail just hasnt got the reserves to go from a 5k account theyve built in there spare time to -15k in minutes.

doggyfx · Jan 21, 2015

I'm wondering are there only talks about losses, ruined accounts, insolvent funds and brokers, etc. Anybody there who turned that event in their favor? Would really like to find out was it a lucky shot or what's unlikely conscious decision...
Just found that stuff from my broker, enjoy https://blog.hotforex.com/hotforex-...355-pips-in-few-seconds-while-selling-usdchf/

volpunter · Jan 21, 2015

This article perfectly makes my point : http://www.theage.com.au/business/markets/the-dark-underworld-of-forex-trading-20150121-12uoi9.html

Which means again, anyone who took a steep loss on any chf positions when the peg was removed should look very hard at where their brokers claim they got filled and if you find evidence that the broker could have filled you at much better prices then you have a solid basis for arbitration and an agreement to lower your loss or cover your negative balance to some degree.

volpunter said:
the problem is with your broker if you truly could not get a fill above 1.00 (eur/chf). Connectivity costs money, maintenance and many retail brokers' business model does not allow for multi and cross connectivity. Has nothing to do with how many orders can or cannot be filled, it has to do with the fact that there was some liquidity and many retail brokers failed or were too arrogant to pick it up. My hunch to be honest is that either their automated risk management systems sucked or they gambled, thinking this would be a short term blip and ignored the small window of opportunity. I come to this conclusion because retail punters' positioning is pretty much identical at Oanda, FXCM, Saxobank..., however, brokers lost very divergent amounts of money. Hence it comes down to their internal risk management procedures that must have varied widely.

running_bare · Jan 21, 2015

Speaking of which where is EMG? :-)

LOL

"More than 90% of small traders lose! They just lose!"