Exactly. Seeing what happened on Monday with this group, and that rumors in general in this environment can cause a domino effect of demise, if you have a fair amount of capital in the firm, this sort of news is some reassurance that your the company is protecting your capital. Leverage doesn't matter if you lose or are locked out of your capital. Ask customers of RFX.
Well go ahead and add my name to the list. I shorted FRE today and was surprised to find that I received a message upon trying to short more that I reached my limit. I made a choice to use IB in part due to the margin requirements and I didn't enjoy finding out the change on ET. I spent about 20 mins after the trade trying to figure out WHY I couldn't short more. IB makes McDonalds look like they have great service. IB may be cheap but there are many hidden costs with how they do business. I am also surprised that the OP could actually get an answer of any sort from customer service. I hope you will at least buy me a beer sometime with your $20 referral
1Reason, frankly , I could care less if you busted out tomorrow and headed straight for the nearest bridge. Nothing personal. But IB and it's responsible customers have no interest in subsidizing your gambling. Have a nice day.
Every overleveraged gambling addict that leaves IB is a win for IB and its clients and the liability of the next broker that somebody chooses.
Is that the complete list? I wonder why these highly liquid big-caps are there?? But not many others, for example the highly leveraged investments banks, LEH MER etc.
A) So everyone who uses margining is a gambler? B) Even if the customer was given only 2:1 margining & was totally leveraged, the only time there would be a risk to IB is if there is a risk that overnight the stock will drop 50%--else the client would get liquidated intraday. I could tell you that this risk does not exist by DRL. I would imagine that's not the only one.
You're right. This is what I'd do. Go to your nearest bank, and tell them theres no risk, would you please lend me 50k dollars so I can buy 100k of this here riskless stock. If you're lucky, they just laugh at you. Buy options if you must enjoy the blessings of leverage. I hear IB sells those too.
Here, the customer deposits funds to the broker. THe stock does not have to be riskless; it's enough that the risk is confined.
How confined was BSC, Refco, etc? Or did you mean they should confine the risk taker? How many of you margin humps are getting blown out on this Gold move?