The risk to VIX time spreads is not news to anyone who has traded switch-risk in commodity futures. I'll add that this is not a product for the masses.
Around 300 contracts 70% short AUG, 30% short SEPT and Long Feb/MAY/08 and $98K liq. Done over the past 6 months, so I just didn't go in there in the past 3 days trying to get credits. Like I said before it's quite hard to judge your ACTUAL risk when you have these trades in your acct and $0 margin req. Forget 300 contracts.. I could have probably done 3000 with the same liq and $0 req.... could you imagine the carnage that would have caused by now!! I bet there are some people out there that took some pretty large losses!
You keep saying "they did this." As another response said, the only person who did the wrong thing, was you. "Brokerage changes rules and wipes out my account. Is there any recourse?" You wiped out your account, not the broker. Learn how to trade and manage your money and risk properly.
Not entirely true. Although the OP bears responsibility for the consequences, it seems that the broker was not keeping its clients up to date regarding the new VIX margin requirements and acted harshly in liquidating the positions. AZD
"Aug 10 - the VIX spikes and at 10 am the broker" things spike. Traders are not supposed to be trading accounts so margin calls are so near. This to me tells me he was overleveraged. That is usually the main reason leveraged traders are in the 95%. They cannot manage their money, and have others to blame for it.
While in general, the liquidation was warranted and justified, this looks like an error and worth talking to compliance about. And if indeed it was an error, to push this issue. Though those are pretty big position sizes!
The OP is 100% at fault for making a series of disastrous trades. If the OP does not start applying max CRITICAL ANALYSIS to his trading NOW... Then the OP will forever be just another donkey... Forever ** giving money away ** to professionals until it runs out. This is no time for excuses. Period.
50% OP's fault, 50% broker's fault. ib should not make changes to margin requirements without adequate notification. this is a pattern with ib, as i've seen others complain about this behavior in other threads, and not just the recent thread from a couple of days ago. tread carefully