XIV margin call at Questrade.......any recourse?

[schweiz]

What if it would rebound after that? He would probably be complaining that they liquidated and that they shouldn't have done that...

I remember this happening in past. It was posted on ET. You never guess what the account holder posted....
"Why did they close my position, they could have let it go a bit further (on who's financial risk?) as it was clear the market would recover. My position go out of the loss later and so it was not necessary to close it. "
ROFLMAO.
The traders opens and closes the trades for his own financial risk. Nobody else has a permission to intervene. The only exception is an account that is wiped out.

 

[edgreen]

Hey guys, I'm Hotcakes genius friend that held XIV overnight. Thanks for all your input. I couldn't feel any stupider at the moment and know I f'd up. But I don't think it had to go down that drastically. Questrade raised my margin call to 100% right after and took 30k in other stocks. I know there are people out there who lost a lot more but I'd still like to see if there is anything one can do to follow this through. All of the people I have talked to are from the US and have filled in the SEC complaint form as a starting place. Do we have a similar process in Canada?

I'm also wondering what you think I should do with the xiv shares I got stuck holding. If there is any case or class action is it better to hold them and have CS liquidate them instead of dumping them on my own?

Thanks guys, and yes I know I'm to blame for holding over night and yes I know it is dangerous to pick up pennies in front of a steam roller. But I've lost everything so I need to try whatever I can.

Cheers,Ed.

 

[spread'em]

Who offered you leverage on this product? That just seems absurd...you went from needing a 80% rally in the VIX to blow out to a 40% rally.

Anyway, I think if you want to follow this up in a serious manner you should seek professional legal advice. Maybe you can get some sort of settlement from CS but I would say that was it. You will get nothing from Questrade as they seem to just be a broker and I'm sure you signed all those forms confirming you understand the risks involved in trading with leverage etc. You'll have to chalk this up to a serious life lesson I think. Again only a lawyer will really be able to say for sure.

 

[edgreen]

Who offered you leverage on this product? That just seems absurd...you went from needing a 80% rally in the VIX to blow out to a 40% rally.

Anyway, I think if you want to follow this up in a serious manner you should seek professional legal advice.... .

Thanks Spread..
What type of Lawyer would be best for this situation. Not that I have any cash left to retain one but it would be good to at least talk to someone.

 

[beefcaketrade]

Who offered you leverage on this product? That just seems absurd...you went from needing a 80% rally in the VIX to blow out to a 40% rally.

Not sure how it works with other brokers. Maybe some allow margining on the VIX ETPs. Interestingly, if I recall correctly, I think even IB used to allow 50% or 75% margining on UVXY/SVXY/etc until they made it 100% margin a while ago. I don't think they will ever allow margining on those products again, ever. I can see some brokers still allowing 50% margin on it.

 

[KeLo]

Do you really think there was a viable market after hrs for a security that was liquidating by prospectus ? Who possibly would be on the other side of that trade ?

There were some buyers all the way down, even though it is obvious sellers dominated buyers most of the time (1-min bars). There was even a brief mini rally @ 3:33pm CT. There was an opportunity to save a 94% loss +/-.

 

[sprstpd]

Hey guys, I'm Hotcakes genius friend that held XIV overnight. Thanks for all your input. I couldn't feel any stupider at the moment and know I f'd up. But I don't think it had to go down that drastically.

It went down that drastically by design. If you cannot bring yourself to understand why the price movement was justified, you shouldn't be trading this product. Even though it sucks that this happened, the best advice is this: close your XIV position and get on with your life. Once you close it out, hopefully you'll feel better. I know I feel better after closing out a big losing position (it clears the mind). Good luck.

 

[sysdevel99]

In the case with IB, I think they require 100% margin on the VIX products. So between that and autoliquidate, it would have been unlikely for margin debt in the event trade went against you like that.

IB and TOS/TD both required 100% margin on XIV on Monday during regular trading hours (and after hrs). I've PM on both accounts but even with portfolio margin you didn't get any leverage - which to be honest saved my butt/accounts. Still lost a small 6figure amount but it could have been much worse.

 

[edgreen]

...the best advice is this: close your XIV position and get on with your life. Once you close it out, hopefully you'll feel better. I know I feel better after closing out a big losing position (it clears the mind). Good luck.

Thanks sprstpd, my friend suggested the same. I'm starting to agree too. Chasing this thing legally is starting to make me more insane than loosing the actual cash. Probably best to just move forward and build up again slowly and understand first, in detail, what instruments I'm playing with.

 

[sprstpd]

Thanks sprstpd, my friend suggested the same. I'm starting to agree too. Chasing this thing legally is starting to make me more insane than loosing the actual cash. Probably best to just move forward and build up again slowly and understand first, in detail, what instruments I'm playing with.

I mean if you really wanted to play the same game, you can just sell your XIV position and move into SVXY which will still be trading after XIV terminates. Or you can create your own XIV like position through options. But usually after getting burned by something, it is best to stay away for awhile, let the dust settle, and think about what you want to do next.