I've read that with a Forex account you're dealing with a lot of leverage and that you can be liable for losses beyond the money that you have in the account. I remember someone saying though, with some Forex companies you'd just lose what's in your account, nothing beyond that. I've just opened an account with FXCM for a few thousand dollars to experiment with some risky trading methods. Does anyone know if FXCM would hold me liable for losses beyond what's in my account? I don't mind if I lost everything in the account but I wouldn't want to be liable for more than that.
With Forex and Futures you can lose more than your initial investment. Under normal market conditions your broker will most likely take you out before you go negative but under chaotic market conditions, like the ones following 9/11, there may not be any buyers for you to sell your contracts to because the market keeps going limit down. I suspect something like that could happen in the Forex market as well.
You'll get a margin call from FXCM and they'll automatically liqudate your position before you lose more than what's in your account.
FXCM Trading Agreement : https://secure2.fxcorporate.com/FxtrServlet/?signal=show_trading_agreement Any questions?
I know they liquidated the seats of Duke and Duke at the end of Trading Places when they couldn't pay up at the end of the trading session.
Some dealers like Oanda explicitly state in their user agreement that you wont be liable for negative balances. There have been incidents where users did end up in the reds, and oanda reset their account to zero (there was a discussion on their forums about that). In my opinion, if you trade that near at a margin call, that this is a realistic posibility, you are doing something wrong anyways. Also, margin call procedures are often somewhat unpredictable. I have read quite a few forum posts where people thought of a margin call as some sort of 'built in stop loss', with unfavourable results.
Dear Sir 1.Best of result ,which was observed was 855% from anonymous from Australia per month on capital 3000$ by FXMC King of the mini -approx 4000 competitors each month He started with 150 k GBP/JPY You can observe alsov http://www.interbankfx.com/Contest/ContestResults.aspx this contest have advantage against fxcm king og the mini ,that 250$ of start capital enough ,price money are better as by FXCM 2. Better make that on paper ... for real price (margin capital on account) http://www.fxsol.com/contest/test-drive/leader-board.html without charge http://www.mgforex.com/eng/forex-demo-account/content/forex-demo-contest-benefits.htm 45$ per month www.marketzar.com without charge (with price 300$) or with charge 50$ (with price 1500$) 3. Best what was by testing by author with real quote paper game 700% per day 3 operations with margin 1:800 GBP/JPY 3100% with margin 1:200 GBP/JPY for 15 days . But that was related to multiple attempts with loss 100%
Also, margin call procedures are often somewhat unpredictable. I have read quite a few forum posts where people thought of a margin call as some sort of 'built in stop loss', with unfavourable results. ################################ GFT forex offer initial margin 1:400 and liquidation margin 1:1600 from initial (25% in agreement) ,but all on solely discretion of the broker . Demo work with liquidation margin 1:1600 ,but not planned to test real money account Your respectfully .... P.S. To GTS - thank you .Was before opinion that CFTC related instruments trading is not so secure from legal and technical point of view as SEC related instrument trading . Share and options account have SIPC protection , future account not . Refco ,public noted future broker dissapeared for 5 days .