RefcoFX thinks that's too low. They like to see 100% of their Forex traders to fail.
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Losing more than you invested
- Thread starter s-dot
- Start date
RefcoFX thinks that's too low. They like to see 100% of their Forex traders to fail.
Quote from skepticaltrader:
right... There would be no way you could lose more than you invest since how would they get the money from you?
But... that sort of thing happens all the time in other trading instruments:
http://www.elitetrader.com/vb/showthread.php?s=&threadid=51251&highlight=goog+margin
Quote from Rearden Metal:
But... that sort of thing happens all the time in other trading instruments:
http://www.elitetrader.com/vb/showthread.php?s=&threadid=51251&highlight=goog+margin
Only because he had another account with them.
skepticaltrader
Guest
Quote from fatrat:
50 pips or greater? Are you serious? I'm an FX newb, and I get away with much less than that, but I'm paying attention to time&sales and market depth to see how much of a "noise band" there is. I generally like to enter trades with momentum on my side in the FX market to minimize noise triggering stops.
This 50 pip stop loss that I'm speaking of really only applies to swing trading and If you can't be by the computer to watch your position all the time.
If you're jumping into a position after a fundamental announcement then yes you don't really need a stop at all because your just riding the momentum, but IMO, if you hold a position over 24 hours you need some type of stop. This is only used in case of a catasrophic incident.
I try to use money management when trading Forex so even if I did place a 100 pip stop loss, its not going to liqidate my account.
skepticaltrader
Guest
Quote from uninvited_guest:
What if you fund your account with a credit card? I wonder what would happen?
I think the only way your account would go negative if you held a position open over the weekend and there was a 80 pip gap opening against you (like on the EUR/USD a few months ago). If your total account balance can't cover that 80 pips then you would have a negative balance, and any stops would be missed.
I don't know of any broker who will allow you to fund your account with a credit card. You could send them a check from the bank who issues you your credit card, but that check doesn't have your credit card info on it so there is no way they could deduct any money from your credit card account.
All these brokers have it built into their trading platform that when you fall below your Margin requirements your position(s) will be closed out.
skepticaltrader
Guest
Quote from skepticaltrader:
I don't know of any broker who will allow you to fund your account with a credit card. You could send them a check from the bank who issues you your credit card, but that check doesn't have your credit card info on it so there is no way they could deduct any money from your credit card account.
All these brokers have it built into their trading platform that when you fall below your Margin requirements your position(s) will be closed out.
Lots of Forex brokers allow credit cards, including FXCM. A 80 pip gap against you over the weekend (EUR/USD a few months ago) will not trigger your stops or margin requirements and could cause a negative balance. Example:
* $1000 account balance at 200:1 leverage.
* 150k lot open ($750.00)
* - 80 pip weekend gap = - $1200.00
* Account now at - $200.00
skepticaltrader
Guest
Quote from uninvited_guest:
Lots of Forex brokers allow credit cards, including FXCM. A 80pip gap over the weekend (EUR/USD a few months ago) will not trigger your stops or margin requirements and could cause a negative balance.
You're right. I just checked FXCM's website and they are allowing investors/traders to fund their account with a credit card. I still don't think they can withdraw money from your credit card without your approval. Its probably best not too fund your account with a credit card anyway. Its best to give a broker as little information as possible.
Thanks for clearing that up for me. That's the first time I've seen a broker allowing someone to fund their account with a credit card.
Quote from Rearden Metal:
But... that sort of thing happens all the time in other trading instruments:
http://www.elitetrader.com/vb/showthread.php?s=&threadid=51251&highlight=goog+margin
Intreresting. The custodian of an IRA allowed a Margin account????
Hmm. That's against IRS Regs.
Quote from ElectricSavant:
Read item 15B
http://fxtrade.oanda.com/fxtrade/doc/customer_agreement.pdf
Wow. I wish FXCM has that in their agreement.
Actually, it dosn't much matter to me.
I don't trade on low equity. And I think those who do will loose their shirts in the end. FOREX markets spike to much for low equity trades and tight stop losses.