don't disagree with yr point, its pretty hard to compare because of all the mkting b/s... now as an example of a practical feature - its only one aspect of risk control of course - i quite like(d) the auto-liquidation mechanism in place at acm for instance... pretty efficient!
now that doesn't stop us from making specific enquiries to try & cut thru some of the b/s, e.g.: http://www.elitetrader.com/vb/showthread.php?s=&postid=885507#post885507 and then make an 'informed' decision ;-) (b4 u ask, i signed up with them... for what i do, credit risk is only one part of the equation, can be dealt with...)
i am surprised to hear such a statement from an IB rep. how do you determine that $500.00 is OK and safe?? these low margins are daytrading margins, positions must be closed out by eod. does not the exchange determine overnight margin? are not customers accounts 'segregated' from the firms assets? i stand by my statement that low margins do not increase risk to the firm. good risk control techniques are what is important for a firm. sincerely, surfer
True and false True to one individual account but maybe false on the accounts as a whole. If you have low margin requirements you have more traders and might have lower commissions and a lot more volume. Youâre not adding into the mix the profit you make for taking that risk. Refco fucked up and did shady things but do you think Refco would have ever made a lot of money without the big margins they gave or any other firm even.
IMHO your line of argumentation is flawed. if a company does not change their risk control but reduce their margin requirements by management decision by 50%, do the run more, less or equal risk now? that "flaw" has nothing to do with the assumption that tighter margins might enforce better risk management and this improved management might overcompensate for the additional risk in lower margins. nevertheless ... i mean changing margin requirments must change the risk profile ... or do you contradict to that???
I think this post is typical of many of your posts. You make a statement which is clearly unsupported by the KNOWN facts. When someone calls you on your statement, you then go on to making lengthy posts in which you change and/or deny your original statement. It does not "damage" the quality of discusion about Refco to point out a statement unsupported by KNOWN facts. Rather, this type of statement unsupported by KNOWN facts that you have made numerous times during the course of this thread and others goes to undermine the quality of discussion. Your point seems to be: "When I make a false statement it serves no purpose to bring attention to my false statement". Please, sir, tell us how YOU propose to discuss the "evidence" regarding what either Rogers or Refco did or did not do. The parties are at this point awaiting a trial wherein the evidence will be submitted, and a judge will make a finding based on those submissions. Last I looked, neither you or I, or anyone else has those facts in their entirety, nor do we know the in's and out's of the law. I think your tactics in many cases remind me of the guy who leads a "lynch party". "Let's get em folks...where there's smoke there is undoubtedly fire". This incessant "jumping to conclusions" on your part is getting wearisome. OldTrader
What is so hard about this? Haven't we already established that a big hit in a segregated account can affect all of the accounts? And that these segregated accounts are not a seperate account in each holders name. They're pooled. So it seems pretty clear that a low margin, highly leveraged player is potentially at risk for, say, a Sunday night gap away from him. Do I have this wrong? Geo.
No, Oldtrader, nobody's posting has specifically identified any such statement. You and Apex Capital have endlessly chanted your mantra, repeating the vague, general accusation that I have posted such statements, but neither of you were ever able to demonstrate a specific example. I didn't change or deny my statements. Nobody identified an incorrect or unsupported statement from me. You're just repeating Apex Capital's vague and unsupported mantra. You are once again chanting your vague, general, unsupported mantra. Your mantra has no relevance to the discussion. I have been asked specific questions by others, but I have been unable to answer them because I must waste my time responding to your irrelevant and childish game of "gotcha". I would like to address the ongoing debate as to margin requirements affecting broker bankruptcy risks, but you are also distracting me from that issue. Your conduct damages the discussion in other ways as well, for example, by distracting other potential participants from the issues, and also by creating an atmosphere of hostility which deters many others from participating. Yet another chant of the same vague, unsupported mantra. You are still incorrect, no matter how many times you chant your mantra. I have received many, many expressions of gratitude, both by PM and publicly in this and other threads, thanking me for my contributions to helping other traders protect themselves from broker bankruptcy risks. Can you say the same? Can you truly claim to have contributed anything of any value, whatsoever, to this discussion? I think not. No, my point is that I did not make a false statement, and that it was you, Oldtrader, who made false statements, and that even if your statements had been true, you have not explained any respect in which they would be relevant to the discussion, or in which they would make any contribution whatsoever. I made no such proposal as to how I would discuss that topic. I was merely suggesting one possible topic area, in which YOU might be able to contribute SOMETHING to this discussion. I suggested that particular topic, because you seemed to be concerned with it, and you seemed to claim to know something about it. Or would it be more accurate to say that you do not have one single idea, or one single piece of information to contribute, having any relevance, whatsoever, to this discussion? Oldtrader, you are hypocritically jumping to conclusions. This is a bankruptcy case. The judge might decide how to settle the bankruptcy estate, without ever holding a trial or making findings on the facts of concern to us. Your statement is so obvious as to be devoid of substantial content. We, as traders, must make our decisions now, so that we can protect ourselves from broker bankruptcies now. We can't afford to wait for a judicial determination that may never come. We can't afford to delegate our due diligence functions to the courts. Neither are the courts capable of doing our thinking for us. I doubt that judges or juries would make very good traders. I previously stated, not a conclusion, but an hypothesis, in the "Refco Account Security" thread, that the Refco parent holding company's concealed $400 million loss was probably originally created by customer trading losses occurring in Refco's regulated futures trading unit. You criticized me for jumping to conclusions, merely because I suggested this hypothesis. And then, a few days later, the Wall Street Journal reported that the loss was, in fact, caused by customer trading losses from the regulated futures trading unit! I was right! Could it be that maybe I'm right about one or two other things as well? Perhaps you objected to my thought process, because you lack the imagination required to perform it? I suspect that in all of ET-land, at most two people actually care about this little side debate we are having, and I'm definitely not one of them. Let me repeat my challenge, Oldtrader. I challenge you to contibute one single idea, or one single piece of information, somehow useful or relevant to this discussion of Refco Fallout. Can you do it? Are you capable?