Frustrating experience today with E-Trade. Opened a 1,000 share short position this morning as a quick scalp. Tried to cover 2 minutes later at a 20 cent profit, but accidentally shorted another 1,000 shares. No problem, I'm short 2,000 shares and the price continues down and I try cover the entire 2,000 shares at a 50 cent profit. The system rejects my order 3 times in a row saying insufficient funds. I end up covering 1,600 shares, but can't cover the remaining 400. I have a longer term long position which is currently under water. Understandably, this reduces my buying power, but I'm trying to cover a short not add a new long position. I can't believe the system would let me in a trade and then not let me out a few minutes later. I call E-Trade customer service twice and each time am put on hold for 15 minutes while the guy talks to his supervisor. They say I'm "boxed in" and can only resolve it by selling some of the long position or waiting until tomorrow when my buying power is renewed. I talk to the supervisor and he basically says tough sh*t. Do all brokerages operate like this? Am i being unreasonable to expect that the software would not let me in a trade (or at least warn me) that I won't be able to get out?
AHHHHHHHHHHHHH OMFG!!!! Anyone who uses e-trade.... has an immense amount of stupidity if reading reviews and still decides to stay. But I don't even wish what happened to me on anyone. Those bastards. Get out with your money immediately, or you will deserve what will happen to you in the future. Go to Genesis, IB, Ameritrade even at least. But e-trade ...... words can not describe how pitiful it can be. At least you got to have someone tell you that you were screwed, I tried calling 4 times and was magically "disconnected" being switched through several departments each time.
No, they don't all operate that way. Your expectations are reasonable. You should never have done business with e-trade. Search this site for reasons why you should never do business with E-trade. Try Interactive Brokers.
Thanks for the feedback. I had already planned on switching before today and have been researching other brokerages, but this experience will dramatically speed up the process. I'm looking at IB, CyberTrader, Fidelity, and TradeStation. I was already with E-Trade before I found this site. My experience and the reviews here convinced me to switch, but I wanted to take enough time to make sure I didn't have to switch again later. But it's just too dangerous to trade with E-Trade. They would have let me short many more shares than I did and not be able to get out. I'm glad it's only 400. It could have been 4,000.
I hate to say it, if you clicked BUY as opposed BUY TO COVER, guess who's fault this almost fiasco was? How does one "accidentally" Short an additional 1000 shares vs. Cover. I am not huge e*terd fan myself, but a carpenter that blames a dull saw for bad woodwork is a poor carpenter in my book.
Surdo, perhaps you belong to that rare group of super traders that has never made an entry error, but I assure you that even the best of us mortal traders make mistakes occassionally. Let me clarify in case you didn't take time to peruse the intial post. I did not push BUY instead of COVER. I did not add to a long position, but rather added to a profitable short position. I made an entry error. I take responsibility for whatever mistakes I make. I was merely asking for feedback whether it was common among brokerages to have a situation where you can enter a trade but can not exit the same trade until the next day. If this is standard practice, then so be it, I'll take my lumps and E-Trade deserves no umbrage in this instance. If that is not the case then E-Trade is worthless as an active trading brokerage, I made a mistake using them, and will soon correct that mistake.
Your error is irrelevant. If you have 1000 shares short and short another 1000 shares and both are profitable, any normal account lets you close out the 2000 shares short because the proceeds are set aside for you to close. I had something similar with OptionsXpress (different facts but in theory the purchasing power idea) and called them up and in 1 minute it was done. The computer system had a default set in so it blocked the order to close so they had to override it manually. E-Trade telling you they have to wait until tomorrow is pretty lame
I have lots of complaints about Etrade, mostly the lousy hold times, but I barely understand what happened here? Boxed?
E-trade, you probably would of been on hold for hours to correct the problem. If you a serious investor, then you shouldn't be using etrade of all solutions.
Stock777, "Boxed in" is the term E-Trade used. What it amounts to is that I was holding a 1,700 share long position as a longer term trade. That position is currently negative (but has not stopped out) and I am holding it as a good longer term trade. At the beginning of the day I still had plenty of intraday buying power. Enough to short 2,000 shares for a quick scalp. After executing the short trade my intraday buying power reduced to a level that would not allow me to buy 2,000 shares. The system that calculates buying power doesn't recognize the difference between "Buying to Cover a Short Position" and "Buying to Open a Long Position" and therefore would not execute the "Cover". Remember, this 10 minute short position was over $1,000 profitable when I tried to cover. Additionally, even though the long position was negative, it was nowhere near close to a margin call. A call to E-Trade should have resulted in a manual overide and execution of the trade. Instead it resulted in 2 phone calls, 30 minutes on hold, and a supervisor telling me "You're boxed in. Either sell the long position or wait until tomorow."