If you or I can't meet a loss the exchange makes good our counterparty and then goes to the broker for payment who in turn goes after us the client. BTW you have NO protection in the event of a big client blow up - all other accounts with a broker can be used to cover the big blowup clients defecit. Theat's right, they use YOUR maney to pay someone elses debt but do not use e'g. Directors assets first. I discovered this not heavily advertised fact throgh having funds withh Refco - I am talking CFTC brokers here.
Exactly, i cleared Refco when they blew up. If this starts a 'run' on MAN then it could be all over whether or not there is bad news.
NMX: it will be interesting to see what the updated bids/offers & membership sales are tomorrow when they get updated
Trust me, I used to be a commodity floor trader for 10 years. I understand all of the above, AND I had funds at REFCO when they collapsed ( and were absorbed by MF ) and I wired my money out then, too. Thank you for your concern though.
Hmmm, I was going to fill out paperwork to trade with a firm that uses MF for clearing. I'm guessing I may want to wait to see whats going on before I move my account.
which firms use MF for clearing? its brutal out there, anything smelling funny is getting taken out to the woodshed
than I think IB customers are fine because they put the funds on a securities account, can you confirm this
Do you mean the Excess nET Capital -- defined as 'adjusted net capital, less the firm's net capital requirement' ? http://www.cftc.gov/marketreports/financialdataforfcms/index.htm