Do stock brokers monitor client accounts losses ?

Discussion in 'Risk Management' started by wic2021californiaxp, Jul 26, 2021.

  1. If I lost 500,000 in one day would my account be frozen ?
     
  2. GotherL

    GotherL

    If you had 500,000 and lost 500,000 in one day that's ur own money.

    On borrowed margin, that's a different story.
     
    Overnight likes this.
  3. tayte

    tayte

    Yes.
     
  4. jys78

    jys78

    Zero care unless it is margin i.e. chance of hurting them, in which case yes they will be all over you.
     
    Overnight likes this.
  5. RedDuke

    RedDuke

    Interactive brokers do it automatically. Their software would auto liquidate.
     
  6. Overnight

    Overnight

    *Spits beverage at screen*

    If you buy $500,000 worth of stock with your own cash, why would they liquidate you? The most you can lose is $500,000, if all the stocks in yer account drop to 0 and you sell all those positions at 0. Even then, there is no reason for them to "liquidate" you.

    How often does that ever happen, anyways?
     
    Last edited: Jul 26, 2021
  7. def

    def Sponsor

    Only if a margin deficit. If it is a $10,000,000 account with plenty of excess liquidity, no issue. The question the OP should be asking is "If I have a broker let me lose $500,000 - assuming negative equity, is my money safe there?"
     
    jys78 and Overnight like this.
  8. RedDuke

    RedDuke

    Of course. I meant if there is margin deficient only then IB auto liquidation will be enabled.
     
  9. ajacobson

    ajacobson

    Probably under the "Know your customer" rule. Same basic concept as a bartender refusing to serve a drunk. A lot more details to consider relating to the character and size of the account. There is also a concern that if you lose everything you might bring an action against them for continuing to pour the alcohol.
     
  10. maxinger

    maxinger

    500,000 rupiah, peso or rupee?

    it doesn't matter how much money you have lost.
    as long as you have enough margin, the broker will be very happy.
     
    Last edited: Jul 26, 2021
    #10     Jul 26, 2021