Hi, sorry bad english, it's not my native language. Overview : I trade with Interacrive Brokers : Futures ES and NQ since 2000. I want to move IB for Globalfutures, Advantagefutures or Velocityfutures for best fees. I want to use X-trader and I trade 8000 contrats each month (4000 R/t). I want to have security for my money but i don't understand how is the US law ? I see that Globalfutures use Rosenthal Collins Group (RCG) or Penson GHCO for clearing. It's a good protection ? An exemple, If Globalfutures bankrupty, my money is save ? Where is my money on a bank account in GHCO, RCG or Globalfutures ? What difference between IB and clearing firms ? I prefer have more fees but more security Finally, if you use globalfutures, velocity or advantage what are the strengths and weaknesses in your opinion? Thanks for yours answers
All three are FCMs and it they blow up your money is probably gone. IB has a Universal Account. That means if you trade futures with them and close your trades they will transfer the mones from the commodities part to the cash account where it is insured ( up to 1$M). And they do it on a intraday basis.
for X-Trader http://www.advantagefutures.com/Home.html is the best perfect infrastructure perfect comms i dont use them (need IB as universal account) but that would be my 2nd choice (they have an access point on the Frankfurt Exchange for direct access to there network via X-Trader)
me1969 > Yes but i trade for life... so if i can limit broker's risk of bankruptcy it will be gone. My personnal's risk of bankruptcy, it's my business moarla> thanks for your opinion, yes infrastructure is very important and actually my preference is for Advantage for this point...
1) Globalfutures is not a FCM, It's a IB 2) All futures accounts are segregated 3) These type of accounts are 100% safe Segregated Accounts (your money, not the clearing firms) The chance of a firm going out of business or closing its doors is always present, unfortunately. But the industry has been set up to combat the dangers to your account should your clearing firm (or brokerage firm for that matter) go out of business. The secret to protecting your money is that investment accounts are held in segregated accounts. This small distinction may seem obvious, but it is of the greatest importance - as it means it is not an asset of the firm you are dealing with (the clearing firm or your brokerage firm), rather an asset of yours. The Commodity Exchange Act requires that funds deposited by a customer with an FCM be maintained in a "segregated" account for the exclusive benefit of the depositing customer. The term "segregated" refers to separating the funds of all the customers (treated as a class) from the FCM's own funds (sometimes referred to as "proprietary" funds) which the FCM uses in its own operations. So that if a firm does go bankrupt, or physically blow up in a 9/11 type event, etc. - there is no claim on your money. If Attain goes bankrupt, we can not pay our debts with your money. The same with any clearing firm. They have no access to your money except to post it as margin on the exchange when you place a trade. Where things get sticky, and where 99% of the problems are in the banking, brokerage, and financial industry is when your money is not in a segregated account. When you write a check to John's commodity fund, for example - the money is then under control of the manager - not you, and it is not in a segregated account. This small point is the most important point in understanding how all this works. Generally, in such circumstances, cash in customer accounts is promptly transferred, along with the customers' open positions, to a solvent FCM even before a trustee is appointed to administer the bankruptcy. After such a transfer takes place, the customer is free to transfer his funds and open positions to the FCM of his choice. The beauty of the segregated accounts protection, is that it was actually put to the test at the end of 2005, when one of the largest clearing firms in the world, Refco, went bankrupt in the matter of weeks. Attain had hundreds of clients with accounts at Refco, and not one of them lost money or was negatively impacted in a any way (maybe a few nervous moments watching the news). In short, the system worked as it was supposed to, on a grand scale.
Thanks a lot for this reply and the time you spent answering my question. Can you explain the difference between an IB and FCM please, at the level of protection. The segregated accounts protection works with IB?
Account Segregation http://www.elitetrader.com/vb/showthread.php?s=&postid=2721165#post2721165 http://www.allbusiness.com/legal/laws/252332-1.html http://www.cftc.gov/tm/letters/99letters/tm99-68.htm