REFCO HOLDINGS is facing a liquidity issue. The segregated accounts that are in Refco LLC are separate from Refco Holdings and the amount of these funds held in these segregated accounts is reported on a daily basis to regulators. In the end, the CME's clearing house guarantees these funds.
Refco Subsidiary Freezes Customer Accounts http://biz.yahoo.com/ap/051013/refco.html?.v=7 Most people are expecting this account freeze to spread to all of Refco, and some sort of re-organization / bankruptcy filing.
Well, Customers would be wise to vote with their feet temporarily -- imo. The risk of losing a few days trading privelages while you move the account vs dealing with a BK is a no brainer...
If you have a futures account with Refco you should not worry about losing your money. The Exchange Clearing Corp has never let one customer lose 1 cent in a segragated account due to the failure of an FCM. If Refco fails, which IMHO is not an unlikely event, I doubt the Exchange Clearing Corp will fail to cover their obligation on segragated accounts. That said if I had 3 cents with Refco I would be transfering it out for the time being because if Refco failed tomorrow, again not likely, it is unlikely you would see your money tomorrow or the next day. It is possible that it could take months, and that is not a risk I would want to take with my own money. On a side note the CME stock is getting its ass kciekd, it has recovered from the lows, but pretty upgly never the less. I would suspect this is out of the very well founded fear that the exchange clearing corp might have to back up losses on accounts with Refco, which they would do. Brandon
I'm sure that's what they would say. Frankly, with what's going on anyone would say that. It costs you almost nothing -- the wire -- and gives you 100% protection from unquantifiable risk...
Regardless of the source, the statement remains true. A simple transfer of cash and positions, might avoid long delays and the process in getting your money back. Problem is that if Refco goes down (and that is an IF), while the funds maybe protected, customers can't trade for some period of time, and that's a risk that a simple transfer out can avoid. Agreed that the Refco competitors, the MAN, GHCO, FIMAT, are dancing on the pending doom right nownow. I am sure that all the senior people from these firms are wandering the halls and telling anyone that Refco is doomed and switch to their firm is a much safer option, and for once, they are right. Refco would do the *same* if one of them is in trouble. Heck, Stan O'Neal (current Merrill CEO) made his name in high-yield banking by literally parking a van in front of Drexel Burnham Lambert, hiring DBL bankers and soliciting DBL clients when they got into trouble. Regardless of what happens, Refco will emerge from this a substantially reduced firm, or just be swallowed up. It is a bit sad, but when the CEO commits fraud, that's what the firm deserves.
, Refco will emerge from this a substantially reduced firm, or just be swallowed up. It is a bit sad, but when the CEO commits fraud, that's what the firm deserves. [/B][/QUOTE] That comment is so shallow. Why should innocent people suffer...for the suppose action of one/two individuals..are we not innocent until proven guilty... yes it looks bad..but I will wait until I have accurate knowledge of the situation before passing judgement..... would not want you as a juror... The word team stands for together everyone achieves more... we are talking about years of business with thousands of people working to make our jobs as traders possible and more profitable... the company(s) are still good companies base upon news from regulatory authorities and people in the know..persons with a lot more information that myself and I assume most of us on ET. I guess you believe in death by association.... sad, very sad... w