Brokers chasing you for negative account balance | Page 2 | Forex Factory

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Brokers chasing you for negative account balance

  • #21
  • Jan 18, 2015 2:14pm Jan 18, 2015 2:14pm
Isn't it just that the algos all got stopped out at once when the price went below 1.2 so the buyers were exhausted pretty much instantly and the market had no time to respond. A bit like the 2010 flash crash. Just a case of who had the fastest connections to execute the stops - which is always going to be the algos.
Stopping the price feed like LMAX did is probably a good thing. When liquidity is that low any futher trade you enter into is very likely to lose you a lot of money.
  • #22
  • Jan 18, 2015 2:32pm Jan 18, 2015 2:32pm
My own experience of the SNB decision is outlined here:
http://www.forexfactory.com/showthre...54#post8002154

My 2 other accounts have just had all open positions closed and they have been locked. So it looks like FXCM are in the process of reclaiming.
  • #23
  • Jan 18, 2015 2:37pm Jan 18, 2015 2:37pm
All brokers who are asked for payment for the negative balance can forget your work in the future.

run out, run out, run...
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  • #24
  • Jan 18, 2015 4:16pm Jan 18, 2015 4:16pm
Quoting Mr-Smith
My own experience of the SNB decision is outlined here: http://www.forexfactory.com/showthre...54#post8002154 My 2 other accounts have just had all open positions closed and they have been locked. So it looks like FXCM are in the process of reclaiming.
And FXCM are now transferring money around my accounts.

I guess this is FXCM's response to my audit request on why my 1.19750 stop was not triggered!

Never will they again earn another cent from me, which would probably not have been the case if I'd had a reasonable response from them.
  • #25
  • Jan 18, 2015 4:25pm Jan 18, 2015 4:25pm
Quoting Forexia
They chose to abandon the market leaving us holding the bag of s***. Well this is REALLY their shit which they created themselves so WHY should we pick up the tabs?

Why would they give you a price for a crappy trade that you were in, your trade, your responsibility, not theirs to get you out of it at a price that is convenient to you.

You shouldn't have been in the trade, end of.
A contrarian; I always disagree.
  • #26
  • Jan 18, 2015 4:26pm Jan 18, 2015 4:26pm
Quoting Breza
All brokers who are asked for payment for the negative balance can forget your work in the future. run out, run out, run... {image}

Should have read the fine print, don't go complaining here after the horse has bolted.
A contrarian; I always disagree.
  • #27
  • Jan 18, 2015 4:37pm Jan 18, 2015 4:37pm
Quoting goldfinch
{quote} Should have read the fine print, don't go complaining here after the horse has bolted.
the risk of trading can not be only to the trader, but also to the broker,
I am not lost.

btw you are from a brokerage house?
  • #28
  • Jan 18, 2015 4:47pm Jan 18, 2015 4:47pm
Quoting Kjyzai
Not with FXCM. It is FXCM's policy to credit accounts to a zero balance when debit balances occur as a result of trading. One of the greatest concerns traders have about leverage is that a sizable loss could result in owing money to their broker. At FXCM, your maximum risk of loss is limited by the amount in your account. All accounts are tracked by our "Margin Watcher" feature. With the Margin Watcher feature, if account equity falls below margin requirements, the FXCM Trading Station will trigger an order to close all open positions. Why FXCM...
I experienced this with FXCM a few years back. I had a balance of roughly $100 and ended up with a -$300 balance due to a weekend gap against my position.
They refunded the account back to $0.00 and life continued. I find them to be a good broker.
Freedom 30?
  • #29
  • Jan 18, 2015 4:55pm Jan 18, 2015 4:55pm
excuse my stupidity, but dont brokers have some type of financial insurance against these type of events?
YOUR MOTHERS ASS
  • #30
  • Jan 18, 2015 5:01pm Jan 18, 2015 5:01pm
Quoting santos23
excuse my stupidity, but dont brokers have some type of financial insurance against these type of events?
Excellent Question.
Forex is a losers game.
  • #31
  • Jan 18, 2015 5:56pm Jan 18, 2015 5:56pm
Quoting goldfinch
{quote} Why would they give you a price for a crappy trade that you were in, your trade, your responsibility, not theirs to get you out of it at a price that is convenient to you. You shouldn't have been in the trade, end of.
It's the LP's JOB to give me a price. That's why they are called liquidity PROVIDERS!!! Well we are finding out how much does that term really mean. And I am NOT asking them to give me a price that's convenient to me. I am asking them to give me prices and prices that are reasonable and not convenient to THEM. This is supposed to be trading in good faith NOT screwing-you-as-much-as-I-can-just-because-I-am-big-and-I-can. And the more that you post these statements, the more you are confirming my point that those LP's stopped liquidity not really out of disbalance (btw that word does not exist in English, the correct term is imbalance) between demand and supply but really out of greed. They want to give a price that is "convenient" to them, that is 1.8K+ pips away so they can all take us to the slaughter and they pick up the profit.

Well like I said before their strategies backfired because they don't realized that we are them and they are actually us; we are all in this industry together. Our loss is their loss too. They want to make a killing against us? Well they get to face all those horrendous negative balances who could only close the trade at a price that was "convenient" to them and also those smart traders among us who were able to close their trades at the price that was "convenient" to them. I can't believe they have the gall to sing their swan song "Wahhhhhh we lost money too!!" and get them published in our retail forex online magazines. Well it's s*** they created, they get to deal with it. We are not picking it up this time, not again! They still owe us the bailout money that we gave them last time from our tax dollars!!
Make your losses in demo. Earn your profits live.
  • #32
  • Jan 18, 2015 6:07pm Jan 18, 2015 6:07pm
Forexia: so how deep are you in the red
  • #33
  • Jan 18, 2015 6:43pm Jan 18, 2015 6:43pm
As my understanding UK law and Europe law, the traders have negative balance may have problem, it is not problem if you are from ASEAN (Asia) where I come from. I told a few friend from Europe they said in the period 2007-2008 the real estate collapsed a lot of people owe the bank a lot for their mortgage housing, eg:: they bough house 500K US$, down payment 100K US$ but their house price gone down to 200K US$, they could not pay and the bank (foreclosure) sold their house at price 200K US$. They still owed the bank 200K US$ and have to pay to them. A few traders in UK & Europe will get the same problem, will they?


Quoting rsmith911
Please post here if your broker is chasing you for money to repay a negative account balance following the EURCHF debacle, whether you are going to pay and what action is taken if you haven't paid. I wasn't involved fortunately but I contacted my broker LMAX (who I have always found to be brilliant and the best broker I have used up until now) to find out what would happen in such a scenario. They just said that I would face legal action if such a debt wasn't paid. Which is kind of scary! Makes me think about whether I should be using them in future....
  • #34
  • Jan 18, 2015 6:53pm Jan 18, 2015 6:53pm
What I would like to know is about the fortunate few who were short eurchf usdchf. Wil lthey get to keep the windfall?
  • #35
  • Jan 18, 2015 7:03pm Jan 18, 2015 7:03pm
Quoting trader121
{quote} Excellent Question.
The brokers may have some insurance, however probably doubtful if there would be any coverage apart from trades that were placed by the brokers' own traders. Trades placed by account holders don't fall under the liability or indemnity of the broker or cover provider.

For these same reasons, the broker should not be expected to cover the traders losses, for whatever reason. We all know the risks, or should do , and therefore are accountable for our own actions. In the name of good publicity, some brokers will forgive small debts or do deals to get back a reasonable amount quickly. But we should not expect this to be the case. Trading is a business , with that comes risk, traders must accept responsibility for that, otherwise everyone would be in business.
BTW, I am not a broker, I am a trader (and businessman) with 20+ years market experience.
  • #36
  • Jan 18, 2015 7:08pm Jan 18, 2015 7:08pm
Quoting santos23
excuse my stupidity, but dont brokers have some type of financial insurance against these type of events?
I don't think they have. The broker usually closes your position ones your account is down to a predefined percentage which "should" be enough security. Well, should ...
There are brokers that use an insurance to ensure you a guaranteed SL, but these will not offer you a spread under 1 on EUR/USD and probably a lot less leverage, too. I don't say you get what you pay for, that would be too simple. But it was relatively clear that the SNB will have to remove that price peg at some point and maybe it would have been a good idea for the people who want to speculate on price-peg-rebounds to use those brokers/offerings at least for these trades.

anyway, time for the david ippolito weekly show and a czech beer.
  • #37
  • Jan 18, 2015 7:20pm Jan 18, 2015 7:20pm
Quoting sonata95
As my understanding UK law and Europe law, the traders have negative balance may have problem, it is not problem if you are from ASEAN (Asia) where I come from. I told a few friend from Europe they said in the period 2007-2008 the real estate collapsed a lot of people owe the bank a lot for their mortgage housing, eg:: they bough house 500K US$, down payment 100K US$ but their house price gone down to 200K US$, they could not pay and the bank (foreclosure) sold their house at price 200K US$. They still owed the bank 200K US$ and have to pay to them....

It is not very correct example. Mortgage has a collateral which is your house, and if the cost of the house drops below your loan size you have a negative equity. The law is different in different countries, but it is true that in Europe you cannot simply walk out. In the USA and some Asian countries you can just send the keys to the lender and forget about it, it is lender's problem. In Europe you will still owe the remainder to your lender.

Forex leverage is uncollateralized loan, so the only way to write is off is bankruptcy or some kind of restructuring agreement with your lender. And that is more or less how it is in any country.
Wookey
  • #38
  • Jan 18, 2015 7:22pm Jan 18, 2015 7:22pm
Quoting shrike
Any reason in particular LMAX should pay for YOUR losses?
makes me wonder if these guys understands the business, what a bunch of morons
  • #39
  • Jan 18, 2015 7:30pm Jan 18, 2015 7:30pm
Quoting shrike
Forexia: so how deep are you in the red
That's for me to calculate, you to guess and my broker to pass to the f***ing chicken s*** liquidity "providers" to eat up!
Make your losses in demo. Earn your profits live.
  • #40
  • Jan 18, 2015 7:46pm Jan 18, 2015 7:46pm
Quoting Trendzalore
What I would like to know is about the fortunate few who were short eurchf usdchf. Wil lthey get to keep the windfall?
Of course! Didn't you hear those liquidity "providers" crying "they lost money too"? Well that's the profit that those smart traders (good for them) made against them! And thanks to the liquidity "providers" stopping the price quote for an hour+, those traders got to tp at the rock bottom price, making 1898+ pips, indeed a windfall!

See if those liquidity "providers" had continued to provide liquidity throughout, their "losses" would've been smaller too because some of the traders might have tp'ed sooner instead of at the rock bottom price when those "prime banks" finally came back to the market. Them stopping liquidity really helped those traders who were long in CHF to "let the profit run"! And now those liquidity "providers" need to pay up.
Make your losses in demo. Earn your profits live.
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