How Safe is Your Money?

I'd like to start a discussion about account security and what everyone's concerns and/or solutions might be.

I think its safe to say that we all desire to be profitable trader's. With that, hopefully, comes a larger forex trading account. Some of you already have a sizeable account, some will in the furture.

How do you feel about the security of those funds. What options have you found or are you employing to try and make those funds as secure as possible.

Related to account balances is the value of open orders. Some strategies call for retaining open positions for long periods of time, perhaps years.

Are you comfortable leaving a 6000 pip trade open with your broker...what if it was for 2 standard lots?

I'd be interested to hear everyone's thoughts.

I only trade with well-established firms in the UK. The FSCS (bankruptcy compensation fund) being the main reason. An american firm with SIPC protection sounds ok too, but i haven't really researched that.

I only leave the money i really need on the broker account (approx. 2x margin). I'm also strictly flat overnight, let alone over weekend. I dont even want to leave the screen while in a position. Trading significantly more that 200k tho..

A cellphone with the number of broker's desk on speeddail and a laptop with mobile internet in case of network or electricity troubles too, altho i got lucky until now and never really needed that.

yes, that was my conern as well.

if you trade full lots, go for forex futures.

for your cash, even clients money seperated from the brokers money is not safe. go for brokers where you have your own bank account in your name.
there wont be many though.

maybe your cash is insured through a scheme, but why go through that hassle?

..but sadly, most will never have to face this kind of burden.

Well... go for a regulated broker, with REAL offices around the world and not just a PO Box somewhere in Offshoristan. And read the smallprint. And pray hard. And don't keep all your eggs in one basket - don't put all your money in forex accounts.

Putting your entire equity in your trading account is pure madness. Only put in what you need and trade "as if".

Came across another thought on a different thread that makes sense.
You may have a 20K trading account. You use that balance to base your lot sizes, risk %, etc. Doesn't mean you have to have that amount with your Forex broker. You could keep it in a traditional bank in a set aside account. Your trades with the Broker would just show a higher leveraged amount. Might be tough with a US broker and 50:1.

Doesn't address the security of floating equity though.

No it doesn't but it mitigates your risk exposure in the most simple possible way.

Yes, it's not so easy to do when the leverage is 50:1 but you should still be able to get away with 50-60% of your equity if you are only opening single positions at a time.

I guess the wider question needs to be, is there a rational fear for the experienced trader?

Keep an eye on your brokers account and pull out at the slightest sign of danger.