If there’s another flash crash in a major market - many heads will roll. That is something that a regulated exchange wants to avoid at all costs. There’s a hell of a lot more to worry about in this difficult endeavor. I wish everyone good fortune.
Thanks very much for sharing this, and bad luck for the 6k loss - that is just the sort of situation I was trying to prepare for. I shall look at all of those options. I suspect that many unseasoned traders would be unaware that even with careful money management and stops, it is still possible to take a big loss when the market moves quickly.
Yes insurance can be expensive. I do spread bet on the Dow so could use guaranteed stops, but as you say, it is probably expensive and self-insurance may be a better option.
Yes, but there wasn't a peg against the USD. EUR-CHF was where they were gambling with their lives trying to make 5-20 ticks, and they paid the price.
Thanks; yes I get this. Maybe my concern should be more with a very sudden market move (say a few thousand points on the Dow) rather than a flash crash.
You cannot protect against everything in life. What you can do: - Use a good and reliable broker - have a backup broker - have backup power supply/ UPS - have backup internet - know what you are doing - do not overleverage Besides that, there is not too much you can do, so dont worry too much.
Let me add... Trade liquid issues with reasonably tight stops. Odds are slim that there will be an event where the "bottom drops out in an instant". More like weakness, more weakness... and then at some point, plunge. Your "tight enough" stop should take you out before the drop gets critical.
Thanks for this. I do have all of those in place (apart from knowing what I am doing, which is very much a work in progress), so you are probably right. In real life I only insure against disaster, not against manageable loss, so that would probably be the best approach here.
Yes but understand the overwhelming amount of money in forex is multinational corporations and major money center banks plus the occasional central bank or two or five hedging their currency risk. Not lol retailers. Once peg was lifted these corporations and banks had to adjust.