Brokers Margin adjustment | Forex Factory

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Brokers Margin adjustment

  • #1
  • First Post: Nov 15, 2016 3:41am Nov 15, 2016 3:41am
Why do most brokers increase their margin, is it good for traders?
  • #2
  • Nov 15, 2016 3:50am Nov 15, 2016 3:50am
Quoting sutivserv
Why do most brokers increase their margin, is it good for traders?
What is good for brokers is generally not for traders ... and vice versa!
MT4/MT5 EAs/Indicators/Alerts coder
  • #3
  • Nov 15, 2016 4:54am Nov 15, 2016 4:54am
Quoting FerruFx
{quote} What is good for brokers is generally not for traders ... and vice versa!
I totally agree with Ferru... one exception for that rule is "true" stp/ecn brokers.. they want that their customers win..

Kindest Regards
Focus only on what truly matters!
  • #4
  • Last Post: Nov 15, 2016 6:49am Nov 15, 2016 6:49am
Quoting sutivserv
Why do most brokers increase their margin, is it good for traders?
They increase their margin when some big uncertain event is about to happen or there is high market volatility. For example passed US elections, Brexit, etc.
The reasons for this is prevent liquidity shortage risks, as some trades made by their clients are hedged by brokers with some other counterparties. Excessive leverage and thin liquidity can create situation where the losses from your trade exceed your capital and the broker will start owe its counterparty.
Lecture: don't trade using high leverage!
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