Brokers chasing you for negative account balance | Page 5 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

Brokers with Negative Balance Protection 41 replies

Brokers that liquidate accounts at zero before negative balance occurs 22 replies

When would chasing a trade be worth it to you? 17 replies

What brokers would you want to use if you had 100k + million + account? 6 replies

Can someone answer question about Brokers chasing stops? 7 replies

Attachments: Brokers chasing you for negative account balance
Exit Attachments

Brokers chasing you for negative account balance

  • #81
  • Jan 19, 2015 9:46am Jan 19, 2015 9:46am
Quoting Spili
{quote} Swiss Rule or Swiss Roll? lol Well, I'm going to spend the rest of the day cutting out pictures of the Swiss alps with my Swiss Army knife. All joking aside though, it must be pretty upsetting. I swiss him the best of luck in getting it resolved.

Swiss Rule.

It must be upsetting and if he came in here trying to find a solution or even just an explanation, most of us would be more than willing to help I think. Instead he comes in here posting everywhere he can blaming everyone else for his loss especially the LP's and trying to get others behind him in his futile attempt to regulate them even more, not realising that further regulation will only be the end for the retailers.

He also misses a basic understanding of how a market, especially the currency market works.

At this rate he won't learn a thing and he will make the same mistake again next time.


Going out to buy my youngest some Caran d'Ache pencils to draw some Swiss alps.... cows and bells included......
A contrarian; I always disagree.
  • #82
  • Jan 19, 2015 10:02am Jan 19, 2015 10:02am
Quoting reQuorter
LMAX just lost it's all reputation in my opinion. Not only I was slipped a lot on EURCHF and I couldn't close my trade for more then 20 minutes, now I am learning that LMAX is also deducting IB's commission when their clients got negative balance and they also threaten their clients to pay for the negative balance! http://www.forexfactory.com/showthread.php?t=521668 I think I will be contacting Financial Conduct Authority (FCA) - if anyone wants to complain to FCA regarding LMAX behavior, please contact me. {quote}
When will people star to understand of what they are doing and with whom. Lmax is exchange meaning they bring together buyers and sellers and match orders. When buyer wins it mean that seller lose and vice versa. So if you lost somebody else won and you need to pay that. It is not the exchange who should cover your losses. Quite simple and nothing new.
  • #83
  • Jan 19, 2015 10:09am Jan 19, 2015 10:09am
Quoting kalastaja
{quote} When will people star to understand of what they are doing and with whom. Lmax is exchange meaning they bring together buyers and sellers and match orders. When buyer wins it mean that seller lose and vice versa. So if you lost somebody else won and you need to pay that. It is not the exchange who should cover your losses. Quite simple and nothing new.
Pretty concise and clear. Makes sense
  • #84
  • Jan 19, 2015 10:22am Jan 19, 2015 10:22am
Quoting kalastaja
{quote} When will people star to understand of what they are doing and with whom. Lmax is exchange meaning they bring together buyers and sellers and match orders. When buyer wins it mean that seller lose and vice versa. So if you lost somebody else won and you need to pay that. It is not the exchange who should cover your losses. Quite simple and nothing new.
kalastaja, I understand that 100% but it's totally unfair to get money from the trader and IB at the same time.
  • #85
  • Jan 19, 2015 10:27am Jan 19, 2015 10:27am
Quoting kalastaja
{quote} So if you lost somebody else won and you need to pay that. It is not the exchange who should cover your losses. Quite simple and nothing new.
Yes, it's unbelievable isn't it!
Just blame someone else for your mistakes.

If you cannot trade nor manage leverage, better to go with FXPro. They now guarantee negative balance from what i see lol
Attached Image (click to enlarge)
Click to Enlarge Name: ff.jpg Size: 75 KB

Rgds
  • #86
  • Jan 19, 2015 11:02am Jan 19, 2015 11:02am
Brokers who guarantee against negative balance are the ones who trade against their clients. So, they are pretty happy with your loss of the deposit and they can forgive negative balance because it costs them nothing. Sounds good? There is only the small matter that these brokers do not want you to make profit they want you to lose money. So it is up to you if you want to use leverage properly and do not trade pegged, floored or highly manipulated currencies to protect yourself from situations like this one or you go to such broker and be screwed on everyday basis by spread, slippage and high commissions.
Wookey
  • #87
  • Jan 19, 2015 11:12am Jan 19, 2015 11:12am
I am not sure if it was already mentioned, but Admiral Markets seemed to have equalised the negative accounts of their members and continue doing so. I would like to show you the mail, but it's in german.
  • #88
  • Jan 19, 2015 11:44am Jan 19, 2015 11:44am
Everybody was enjoying the benefits of leverage until the SNB steamrolled onto us retail traders.

Emotions aside, don't you think its fair that when we trade on leverage (borrowed money from the broker) we are responsible for that? We enjoyed the profits of leverage, now its time to pay up.
  • #89
  • Jan 19, 2015 12:06pm Jan 19, 2015 12:06pm
Quoting str8
{quote} I think it's fair if the broker clearly says on the first page that losses can exceed deposits. If the broker says on the first page they offer a negative balance protections or says that you can lose all your investment (instead of more) and then want the negative balances then I don't think it's fair anymore because they are trying to make the traders believe they can only lose their deposit.

They don't have to say that on the first page, just read the terms and conditions that you agreed to plus any changes and amendments that were communicated to you.

They only have to say on the first page, or soon thereafter whatever their respective regulator requires them to.
A contrarian; I always disagree.
  • #90
  • Jan 19, 2015 12:07pm Jan 19, 2015 12:07pm
That is a strange comment, str8, I doubt that many traders think of themselves as losers before loss happens.
The funny thing is that those traders caught in EURCHF positions HAD a winning strategy and the strategy was scalping for few pips near the floor level effectively making money courtesy SNB. And they counted that SNB will give them profit all the time, but SNB thought differently and stopped providing bids, creating huge turmoil destroying those people's accounts.
So, do you think they thought of themselves as losers until now? I bet most of them thought that they have found a mother lode. Heck, they still think that they were robbed by SNB, Liquidity providers, Brokers or anyone else.
Wookey
  • #91
  • Jan 19, 2015 12:19pm Jan 19, 2015 12:19pm
Quoting str8
{quote} Let's be serious, a lot of traders don't read those term and conditions and even if they read, they may not fully understand them. It's ok for a broker to go after their negative balances but the law should force them to clearly inform the trader about this risk on the first page. If they fail to inform them clearly on the first page it's not fair anymore to go for the negative balances. However until now I saw all brokers who sue their clients say on the first page they can lose more than the deposit and I have no problem with that.

Ignorance is no defense, can't wait to see the first trader show up in court and tell the judge that since it wasn't on the first page and he couldn't bother to read the terms and conditions he really should not be held liable for his loss.

Yes, I can see that fly...
A contrarian; I always disagree.
  • #92
  • Jan 19, 2015 12:32pm Jan 19, 2015 12:32pm
Quoting reQuorter
{quote} kalastaja, I understand that 100% but it's totally unfair to get money from the trader and IB at the same time.
How it normally goes is that IB receive compensation based on business the trader is doing with Lmax or any other exchange. If trader does not paid, meaning it is going to be a loss for exchange then the IB should not be entitled to receive a commission or do you disagree. In other words. Exchange pays to IB when they make money. If money is not made then there is no commission to be paid.
  • #93
  • Jan 19, 2015 12:32pm Jan 19, 2015 12:32pm
Quoting wookey
That is a strange comment, str8, I doubt that many traders think of themselves as losers before loss happens. The funny thing is that those traders caught in EURCHF positions HAD a winning strategy and the strategy was scalping for few pips near the floor level effectively making money courtesy SNB. And they counted that SNB will give them profit all the time, but SNB thought differently and stopped providing bids, creating huge turmoil destroying those people's accounts. So, do you think they thought of themselves as losers until now? I bet most...

It is a pretty unfortunate situation, but one that also teaches us something. For one brief moment we got to see the vulnerability of brokers, got an insight to how they operate, got a much better understanding of market gaps and the real risks of trading fx. But even more importantly, for all of the pure chartists, the technical vs. fundamental question was answered - yes, by all means have a technical strategy but you cannot operate that strategy in a vacuum. You still need to be aware of central bank policy, interest rates and upcoming news events. If this event was so unforeseeable, why were risk departments insisting that their brokerages limit leverage of CHF pairs? The SNB always said this was a temporary peg, so it wasn't wholly unexpected. We also saw the value of experience - those of us that have been around long enough to have seen CB intervention first hand (BoJ I'm looking at you!) know how dramatic it can be.

Apart from trying to get free money (ha!), what was the point in CHF trading? - there was no real movement in the eur/chf, the usd/chf was just eur/usd in reverse, unless you were being lazy you shouldn't have been in there. Complacency is a killer - just ask all of the speculators on the Chinese exchanges who just got nailed for being lazy and just blindly rushing in!!

You're up against the best and brightest in this market, the most well funded, and the HFT algos, and the CBs who can create money out of thin air, in the midst of a currency war, in a global debt bubble. It's a minefield, you've got to keep your ears open. There's no such thing as a free lunch, and never ever trust a Central Bank!

But, if you DID manage to dodge the bullet, no matter your trading level, take some pride in the fact that you were smarter than a lot of the billion dollar hedge funds that just got creamed out of existence. Pat yourself on the back and take the lesson - I've spent the whole weekend rethinking my approach too, we all have something to learn, always.

I'll leave you with news that the SNB have said that there are likely more interventions in the pipeline, the message is loud and clear: stop speculating on the Swiss currency or we'll punish you for it!
"Risk comes from not knowing what you're doing." - Warren Buffett
  • #94
  • Jan 19, 2015 12:33pm Jan 19, 2015 12:33pm
Quoting str8
{quote} I think it's fair if the broker clearly says on the first page that losses can exceed deposits. If the broker says on the first page they offer a negative balance protections or says that you can lose all your investment (instead of more) and then want the negative balances then I don't think it's fair anymore because they are trying to make the traders believe they can only lose their deposit.
Don't you think you're just looking for an excuse? I can get your point of view, if the broker absolutely did not mention this at all, but look to the T&C's and its all there in B&W. Further more, with ECN's for most part, brokers do also post something like "we will try to fill your order at the best possible rate" if there was clearly a lack of liquidity and no orders sitting below 1.2 or 1.9 or even 1.8, what can one do? We can't even blame the LP's in this case. And whatever orders were sitting below 1.2, must have been overwhelmed by the sheer size, so maybe a lucky few managed to get away.

I think the SNB did intervene to lift prices of 0.8 or 0.9 levels or we would have seen even worse consequences.

Don't get me wrong, I do understand the pain of traders who were hit (and those who dodged the bullet like me are just as concerned), but the sooner we realize the risks we take, i'm sure the better our approach will be.

Perhaps for a change, instead of people flocking to trading strategies, we should be focusing on methods to improve our risks. But that being said.. there is no guarantee to anything.

Trading partly reflects life and the current complaints by traders is like saying, "hey god, if you want to send me to earth, then I need a guarantee that I will live to eternity"

Let's learn from this incident and use it to better ourselves. And for the ones who are now faced with losses to pay, hope something works out, maybe pay the broker in installments or something.
  • #95
  • Jan 19, 2015 12:48pm Jan 19, 2015 12:48pm
Quoting str8
{quote} I don't understand all from terms and conditions as I'm not a lawyer (there are many dumb lawyers who also don't understand). I'm looking for a broker that offers no balance protection as I use a lot of leverage because I don't keep all my money in the broker's account. I don't care if the broker trades against me since I'm winning. The problem is I don't know if such a broker exists. Because they say on the first page I can't lose more than the deposit and then their lawyers write something in terms and conditions that can make them win...
Your argument would be valid if the broker merely hosted 1 page. Would you buy a house looking at it from the outside? Or when you buy a car, wouldn't you look beyond the looks of the car and check on mileage, horsepower and stuff?

Shouldn't you/us/we be doing the same when it comes to trading too?

And i'm curious to know which are the brokers that you constantly mention who "DID NOT" carry the disclaimer on their website?
P.S: What worries me are brokers who offer -ve balance protection.
There are no free lunches.
  • #96
  • Jan 19, 2015 1:13pm Jan 19, 2015 1:13pm
Here is an interesting thought - in the UK if you want to borrow money to buy a house you might be able to borrow 4 times salary at most.
For that they want to see proof of employment, previous regular salary payments going back months and of course the collateral of the property.

Even on my small account FX brokers are willing to lend figures up to £1,000,000 with no collateral, proof of income, employment, nothing.

The people lending this sort of cash can't be surprised when this sort of thing happens. This is part and parcel of the business of risky money
lending. It's up to them to calculate whether it is profitable in the long run.

I quite like the CMC markets approach where you can alter the amount of leverage you use on a per trade basis. It makes it more transparent how
much money you are really playing with rather than just clicking a button which says 10 lots.
  • #97
  • Edited 4:14pm Jan 19, 2015 3:48pm | Edited 4:14pm
Quoting goldfinch
{quote} forexia is trying to gain support for a ridiculous attempt to regulate us even more so that when that does happen he can sue the LP's for his money back. There is nothing he can do now as the fault lies entirely with himself. It is entertaining, I don't see it gaining any traction at all, the longer he goes on the more he ridicules himself here. He doesnt realise that his call for more regulation will only hurt small traders in the end.
Well looks like I don't have to try very hard to "gain support" (LOL) for people to realize what those liquidity stoppers did against us in this SNB fiasco.

http://forexmagnates.com/banks-bucke...nc-volatility/

This is EXACTLY what I have been saying all along and even more. Not only the liquidity "providers" stopped the market with the "technical glitch" (a common tactic employed by those bucket shop MM brokers); they even screwed brokers with bad fills, fills that is WAY worse than the actual price; something none of us wouldn't even be able to know because we are retail traders on this side of the trade.

And like I said in another post:

Quoting Forexia
{quote} This makes sense because whether you realize it or not, the liquidity "providers" or "prime banks" is really the BIGGEST bucket shops for the ENTIRE forex industry or I should say the ULTIMATE bucket shops for the forex industry, not just retail one but the entire forex industry. They are IT!! All of your orders, no matter what kind of brokers you trade with whether it's ECN or Market Maker or a hybrid like FXCM and Oanda, Market Maker but hedge your positions, ULTIMATELY your orders end up with them, the liquidity "providers" like Deutsche, , Citi, Barclays, UBS and etc., all those flashy logos that you see at the bottom of the webpage of your brokers that boast the deep liquidity that it has. Yes they are certainly deep but when s*** hit the fan, they all disappear.

And during the time when they are providing "deep liquidity" to us; they are all trading against us since they always take the opposite side of all of our transactions. Basically our losses are their gain and vice versa. So if we see all of those unscrupulous dishonest trading practices done against us by small bucket shop market makers like stop hunting, front-running, honouring negative slippages but not positive slippages, not filling your orders due to "system glitch", what makes you think those BIGGEST market makers who have nobody to hedge your trades against (because they are IT) wouldn't do the same thing to us? And they did just that last Thursday during the SNB decision, they created one HUGE "system glitch" not filling our orders for ONE HOUR+ and then coming back scooping all of our orders with 2K+ negative slippages and at the same time, trying to weasle out their way into honouring the positive slippages that winning traders had against them.

FXCM got fined by FCA, and subsequently CFTC/NFA for unfair slippages. Why shouldn't the same regulatory bodies investigate these liquidity "providers" for the same shady slippage practices and persecute them? Just because they are bigger than FXCM, so they think they should get away with what they did??!! No they need to be investigated, persecuted, and regulations passed to stop these unscrupulous behaviour. I am not surprised that they haven't been because when you are big enough, you are beyond touch and above the law.
If this doesn't call for regulations against those liquidity "providers", then I don't know what would?
Make your losses in demo. Earn your profits live.
  • #98
  • Jan 19, 2015 4:03pm Jan 19, 2015 4:03pm
Quoting wookey
That is a strange comment, str8, I doubt that many traders think of themselves as losers before loss happens. The funny thing is that those traders caught in EURCHF positions HAD a winning strategy and the strategy was scalping for few pips near the floor level effectively making money courtesy SNB. And they counted that SNB will give them profit all the time, but SNB thought differently and stopped providing bids, creating huge turmoil destroying those people's accounts. So, do you think they thought of themselves as losers until now? I bet most...
It was only a winning strategy if they made more than they lost executing the strategy. If they had a net gain, then why are they all complaining? There is no guaranteed return, that is one of the first things people are supposed to have learned.
  • #99
  • Jan 19, 2015 4:08pm Jan 19, 2015 4:08pm
Forexia
ignore fools.
trader is risking his money, and brokers to secure profits,
that logic
  • #100
  • Jan 19, 2015 4:13pm Jan 19, 2015 4:13pm
Quoting goldfinch
{quote} forexia is trying to gain support for a ridiculous attempt to regulate us even more so that when that does happen he can sue the LP's for his money back. There is nothing he can do now as the fault lies entirely with himself. It is entertaining, I don't see it gaining any traction at all, the longer he goes on the more he ridicules himself here. He doesn't realise that his call for more regulation will only hurt small traders in the end.
But what really puzzles me is WHY people like Goldfinch and some others would get so worried when I am proposing regulations against THEM, the liquidity "providers" and not us? I am proposing the financial regulatory bodies should scrutinize on those liquidity "providers", the ultimate bucket shop market makers in FX industry just like how they scrutinized FXCM, WHY would those commentors need to get all jittery and flustered and making comments like I am ridiculing myself and then accusing me of "regulate us"? Who's "us" to him? I am proposing regulations to regulate "THEM", the liquidity "providers" here since they trade against us as I explained to my previous post, so people that I consider as on the opposite side of us retail traders is "us" to goldfinch? UNLESS goldfinch and like many other commentors are just clueless trolls, which side are they REALLY on here? Who are they really? Somebody who works for banks perhaps? But doesn't really look like it because so far they haven't posted NOT one forex trading related or market mechanism related analysis other than comments like "swissy cheese sandwich". LOL

But anyway, I do believe some regulators do need to look into this to make sure our forex trading market is an orderly one and this type of unscrupulous behaviour is not to be repeated again. All business relationship should be based on good faith not trying to see how much I can get away with after screwing the other party.
Make your losses in demo. Earn your profits live.
0 traders viewing now