Going broke in margin acct. and owing money

Discussion in 'Risk Management' started by OptionFool, Feb 6, 2018.

  1. qxr1011

    qxr1011

    it depends of who r u and what do u have

    if you do not have much, you just walk
     
    #11     Feb 7, 2018
  2. Wasn't he a trading instructor? Kind of looks bad if his students went into bankruptcy.
     
  3. RRY16

    RRY16

    Explain please.
     
  4. vanzandt

    vanzandt

    That all depends on which state said debtor resides. If you have a house.... make sure your wife's name is on the deed too. That pretty much makes keeping your home out of judgements levied against you bullet-proof. Might be hard to do ex post facto though.
    If all else fails...max out every credit line you have on Bitcoin and skip town. :sneaky:
     
    Last edited: Feb 14, 2018 at 7:39 PM
  5. ironchef

    ironchef

    You must be one of those professional traders?

    For us mom and pop retails, our brokers will not let us get to that point. For sure not Schwab who I have been with for 20 years and I always got margin calls as soon as accounts dipped below margins requirement. They are always in the position to liquidate my account before me owing them money?
     
  6. vanzandt

    vanzandt

    Schwab lets people buy options on margin?
    Gotta like that.
    hmph
     
  7. dealmaker

    dealmaker

    They will get a judgement on you and all your future wages/ income will be garnished....
     
  8. ironchef

    ironchef

    Yes. Under certain conditions.
     
  9. speedo

    speedo

    Yes, they will get a judgement which will follow you around and attach assets if and when they appear. BK is the only way out of that trap....or changing your name and moving to Uzbekistan.
     
    dealmaker likes this.
  10. vanzandt

    vanzandt

    A margin account is required only if you write options... because in theory your risk is unlimited. Even if its a multi-leg strategy with limited risk. Purchases of puts/calls however come directly from, and are limited to, the cash side of your account.

    optionsjpg.jpg

    I assume thats basically because with an option you can lose 100%, whereas with stocks they can define a reasonable margin risk.
     
    Last edited: Feb 16, 2018 at 8:57 PM