Made A Mistake Entering # Of Shares @ Schwab! Help!

traderdave72 · Jun 26, 2007

Quote from gnome:

OP probably signed arbitration agreement when account opened. No attorney, no lawsuit.... and $700 is too small to mess with beyond begging broker to "make things right".

There is also an agreement that the client bears full responsibility for all online errors. I think he's SOL, unless broker just wants to be "nice".

I know when I opened a trading account, and I have a few of them, they all had a form that I had to sign basically saying that even though they had an algorithm to help stop you from going over your limit or margin, technology is not perfect and if I am going to trade with them, I have to accept responsibility.
If you only lost $700, be glad, it could have been a lot worse, if you are daytrading, get used to losing money, I don't think you have much of a chance against the Schwab lawyers.
I would have to ask myself if I really wanted to invest both the time, and money, to fight for $700, and remember, you were the one to put the numbers in, you are somewhat at fault. Just my pennies worth.

t1ck3r · Jun 26, 2007

Obviously they didn't code in a quote fetch for market orders to calculate your buying power. With a limit order they most likely just calculate it at the client using your limit price.

So the work around is don't use market orders and or double check every order.

Greg

Wayne Gibbous · Jun 26, 2007

Sorry for your loss, but you DID make the error.

And the other side of the coin is, would you be begging Schwab to take $700 out of your account if you had accidently made it as a profit?

Good luck in your trading.

Biog · Jun 26, 2007

Quote from Wayne Gibbous:

Sorry for your loss, but you DID make the error.

And the other side of the coin is, would you be begging Schwab to take $700 out of your account if you had accidently made it as a profit?

Good luck in your trading.

Well put. We wouldn't be having this discussion if the mistake ended in a profit.

GTS · Jun 26, 2007

Quote from Biog:

Well put. We wouldn't be having this discussion if the mistake ended in a profit.

However I do find it interesting that HolyGrail stated that when that situation happened to him they took back the "extra" profit. That hardly seems legit.

gnome · Jun 26, 2007

Quote from GTS:

However I do find it interesting that HolyGrail stated that when that situation happened to him they took back the "extra" profit. That hardly seems legit.

We've all had a "fat finger" error or two.

Brokers have limits and [attempted] safeguards to protect not only themselves but the clients as well. Just because the broker didn't catch and prevent a customer error it doesn't mean the broker is at fault.

HolyGrail · Jun 26, 2007

Quote from gnome:

We've all had a "fat finger" error or two.

Brokers have limits and [attempted] safeguards to protect not only themselves but the clients as well. Just because the broker didn't catch and prevent a customer error it doesn't mean the broker is at fault.

I agree, BUT, there are margin rules. He should not have been allowed to go that far over margin requirements. The broker has liability here in my opinion.

AAAintheBeltway · Jun 26, 2007

Quote from HolyGrail:

I agree, BUT, there are margin rules. He should not have been allowed to go that far over margin requirements. The broker has liability here in my opinion.

They have some responsibility but they could also turn around and say he committed a Reg T violation and has to deposit extra funds in account to cover it.

My advice is to demand to talk to a compliance official. Their s/w should prevent this. What if it had been 10,000,000 shares?

SWScapital · Jun 26, 2007

One of the many pitfalls of DAT. It happens to the best of us.

brownsfan019 · Jun 26, 2007

Good luck trying to recover $700 if you bring a lawyer into the mix. You'll probably be out even more money.

Learn from the mistake. Sure, the broker could put safeguards in place on market orders, but then someone would complain that the 3 seconds it took to execute the market order cost them money.

Here the OP made the error. Man up and accept it and learn from YOUR mistake. Whatever happened to the times where men could act like men and say - I made an error, learn from my mistake. Now we get - call a lawyer to try to recover some of the 700 bucks! You'll be lucky to get a 50/50 split and then you have to pay your lawyer...