$500 intra day margins - reasons

I am still searching for the ever elusive "best futures broker" and I have noticed an interesting trend. Namely, that many of the brokerages offer $500 intra day margins, some even go as low as $300. My question is: Why are they putting such teaser rates??? After all are they really expecting anybody to trade with $500 in their account???? What is the deal here?

 

So why the silly teaser rate???? What is the reason for that $500 intra day margin then?

 

Maybe $500 margin lets a trader trade more contracts, which gets the broker more commissions.

 

Errrrr......commissions. People are likely to ignore money management given the opportunity. If a guy with a 3K account can trade 2,3,4,5 contracts there is a high probability that will happen, sooner than later. Marketing 101.

 

Its not really a teaser rate unless you intend to trade less than 4 contracts, assuming the minimum acct. balance is $2,000. If I have $5000 in my account, then a can trade 10 contracts with $500 margin. If someone can't come up with $2,000 to open an account, then they need to go back to work at McDonalds. "Would you like to Supersize that"?

 

So they basically entice people to trade more by providing this kind of margin and consequently have them blow up. Sad

 

By the same account he will also have a much greater probability of going bust and stop providing com. fees altogether. So, I see where you coming from, but I still do not understand the logic behind it. It seems very short sighted.

 

I have not eaten at MC since the mid 90's. They towed my car while I was inside trying to digest their pseudo food. Long story short, that year my attorney had enough money to get his swimming pool redone and I swore never to dine at thier fine establishments ever again. Then again, maybe I should, I could use a pool.

Even 2 grand is asking for trouble.

 

To lure dumb money into the market.

 

We do offer $500 day trading margin as well along side with very competitive commissions to help reduce your cost. We have a variety of diffrent trading platforms some that offer day margins, and some with standard exchange minimum, our services are 24 hours a day and just to point out we offer offer low margins but we do not force clients to use it. Let me know if you would like some more detailed information.

Thank you

1-877-367-3177 x 127

jkhek@gfetc.com

Johnny Khek