The Shocking Truth about 'Segregated' Accounts

[HATEtheRisk]

Quote from DontMissTheBus:

Comparing nominal rates is pretty useless from a 'deposit' point of view, don't you think?

No, i dont think.

If you live in more than one country and must decide where to put your money on - you need a save economic country and the best interests.

I am talking about time deposit interest accounts, nothing else.

The currency converting risk, how you mentioned it, can be handled, if you study then chart timeframes over 1 year timeframe, to see how the market will go in that one year you have your money on a fixed account, without any risk - so thats the only risk you can have, but as a pro trader, who knows how to predict the markets odds, thats not a real problem.

Also, if you would live in Switzerland, you would not have your money in CHF, better in GBP or PLN to grow it. - the few money you need for living doesnt matter in this case, if you can make 3-5% a year without any risk !!!

Of course this is only usefule if you begin with minimum 1.000.000,- $,€,GBP. to earn 30k - 50k a year.
Of course, you also have to pay taxes on it.

But thats the opportunities the banks offer you, worldwide.

 

[mokwit]

Quote from Ash1972:

Let's establish one thing: UNDER NO CIRCUMSTANCES WILL SEGREGATED ACCOUNT HOLDERS HAVE TO BE PART OF THE BANKRUPTCY PROCESS AND QUEUE UP WITH UNSECURED CREDITORS LIKE JP MORGAN?

Is that true? Is that set in stone?

No, you have NO protection in the event of a big client blow up - all other accounts with a broker can be used to cover the big blowup clients defecit. Theat's right, they use YOUR maney to pay someone elses debt but do not use e'g. Directors assets first. I discovered this not heavily advertised fact throgh having funds withh Refco - I am talking CFTC brokers here.

Assume this applies to MF as it is effectively the same as a seat owner. Now you know why big traders have pesky retail accounts.

Read this Refco thread

http://www.elitetrader.com/vb/showthread.php?s=&postid=1839708&highlight=mokwit+refco#post1839708

 

[HATEtheRisk]

Quote from mokwit:

No, you have NO protection in the event of a big client blow up - all other accounts with a broker can be used to cover the big blowup clients defecit. Theat's right, they use YOUR maney to pay someone elses debt but do not use e'g. Directors assets first. I discovered this not heavily advertised fact throgh having funds withh Refco - I am talking CFTC brokers here.

Assume this applies to MF as it is effectively the same as a seat owner. Now you know why big traders have pesky retail accounts.

Read this Refco thread

http://www.elitetrader.com/vb/showthread.php?s=&postid=1839708&highlight=mokwit+refco#post1839708

The safest places for your money !!!
(First, the BEST)

1. Have physical Gold + Silver hidden on a secret place, for at least $2M.
2. Big Bank (like Banc of America, HSBC ....), savings account - no online !!!
3. Big Bank - checking account - online/not online
4. Big Bank - Trading Account - institutional style service
5. Big Bank - Trading Account - Retail Brokerage
6. Big Investment Company (like MF Global, RJO Futures.....)
- Trading Account (company capital = > $200M) , based in USA or West Europe.
7. Middle Investment Company - Trading Account
(company capital = > 100M$, like FXCM), based in USA or West Europa.
8. Small Investment Company - Trading Account
(company capital = <50M$), based in USA or West Europe.

And finally the worst of all,
9. Small Investment Company - Trading Account
(company capital = <50M$), + NOT based in USA or West Europe.
and not regulates by any financial service authority.
and offers Meta Trader 4. They have the license to scam you.

FAZIT:
Only trade with Big Banks.
Grow your funds and try to get an institutional service access with a Big Bank.
Safe your profits to your savings account.
Spread your capital to several Banks.
Save money in physical gold + silver.
Buy real esate.
Prepare for the next mega inflation.

In the financial world, there is no saver place as a Big Bank !!!
There are only about 20 to choose, which headquarters in USA and West Europe, all other countries sucks anyways.
USA and West Europe have the strongest and savest economies.

But it can all blow up one day, so better bring your sheeps into the dry.

Lets go, a lot of work to do......

 

[bone]

The obvious thing to do is park a T-Bill in your account that is registered in your name. Let the FCM margin against it, and then wire money as needed. Just make sure the T-Bill is issued in your name. In other words, the Fed wires the coupon to you. The FCM cannot take that instrument outside of a premium guarantee for liquidation.

 

[hughb]

An S&P futs trader named Marty Schwartz wrote a book a few years ago called Pit Bull. He told a story about how he found out one morning that his account was frozen and he couldn't trade. He called the head of the brokerage, (maybe it was the FCM, I don't remember, if anybody else remembers please correct me), and demanded that his funds be wired out immediately, but the owner bullshitted him and then hung up the phone and wouldn't answer the phone anymore. His account had $1.2M in it and he said he was sure that they had taken his money out of the segregated account and lost it in a bad trade. For days he was on the phone screaming and anybody trying to get his money back but to no avail. Then one day another brokerage called him and said that they had picked up his account and the entire $1.2M deposit was there, and he could start trading immediately. He said he doesn't know if that him getting his money back meant that someone else didn't get theirs, but I'm pretty sure that the smaller accounts took the losses and the bigger guys like him were made whole at their expense.

It always seems that just about the time I decide to get into trading futs, something like this happens. I was about to do it when Refco went under, and now this. It seems to me that some large insurer like SIPC or Lloyds would step up and write policies to insure at least a small amount of customer funds, it would make the small guys like me a lot more confident about opening an account.