Worried about losing money stored at the brokers account?
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Thread: Worried about losing money stored at the brokers account?

  1. #1
    Not sure if this really is what individuals do. In case my trading account is $100,000, I keep $85,000 at my regional bank account, which can be comparatively safe. Place the remaining $15,000 with the broker.

    High leveraged broker assists as it implies you have to deposit with them. In case the account grows then take proportional money back into your home bank account. If you eliminate money trading then top it up with the money from your home bank account. Safer than leaving the entire $100,000 together with the broker.

    That is of course assuming low risk a trade, less than 5% of the account. 5. If you're risking 50 percent per trade then this egy wont work well.

    So for a 100 pip stop loss, my place size is 5 lots. So from a 100:1 broker I want a $5000 margin. Out of a 500:1 broker I want $1000 margin. Higher the leverage that the less money is at risk staying at the brokers account.

  2. #2
    Sometimes the higher leverage the loss.
    Leverages control people who cannot control themselves.

  3. #3
    Quote Originally Posted by ;
    Occasionally the higher leverage the higher loss.
    Leverages control people who cannot restrain themselves.
    Pivotal word being sometimes

    I understand using higher leverage has made me sooooo more money which I had never had without it, sooooo more.

  4. #4
    Quote Originally Posted by ;
    Not sure if this really is what the majority of people do. If my trading account is $100,000, then I maintain $85,000 at my regional bank account, that can be comparatively safe. Put the remaining $15,000 with the broker.

    High leveraged broker assists as it implies you have to deposit with them. If the account grows then take proportional cash back into your home bank account. If you lose cash trading then top it up with the cash from your home bank account. Safer than leaving the entire $100,000 with the broker.

    This is of course assuming low risk a trade, less than...
    Hello, Dark.

    That which is correct. What's your question?

    Don't trust brokers too much, even the most honest and most dependable ones. Give them only money you are ready to lose.

    Many things can happen... and your founds will be blocked. Would you desire this?

    P.s Don't put all eggs in 1 basket.

    Good fortune

    Josef

  5. #5
    Quote Originally Posted by ;
    Don't trust brokers also much, even the most fair and most dependable ones. Give them only money you are prepared to lose.

    Josef
    Absolute truth. A broker is not a bank to
    keep money with.

  6. #6
    Quote Originally Posted by ;
    So for a 100 pip stop loss, my place size is 5 lots. So from a 100:1 broker I need a $5000 margin.
    Dark, you probably all ready know this, but for those who don't, there's a tiny bit more to the equation.

    Balance minus Required margin = complimentary margin. Required Margin being the cost of buying the 5 lots. So if you are buying 5 lots in the EUR/USD pair, your account deposit has been in USD, and the current price is @ 1.452350, then it might cost $7,117.50 and the spread simply to start your own position.

    Then you need to incorporate the risk value or cost. In your case the 5,000

    Should you add those two together you receive $12,117.50 the disperse cost. If you deposited that sum and your broker gave you a margin call at 100% of the cost of needed margin, you wouldn't require a stop loss since you would get a margin call and the broker would shut your position at 100 PiPs anyway. That may or might not be okay according to your own trading style. It's Not mine. I would just a soon NOT inform my broker Hey look at me I just have a few PiPs to a Margin Call. But that's just me

    so that you can not deposit $5,000 and make it function.

    By the way Occasionally the Greater leverage the Greater loss. Leverages control men and women who cannot restrain themselves. If you can not restrain your self - DON'T TRADE Leverage DOES NOT control men and women who cannot restrain themselves. 100/1 leverage buying 1 lot using a 50 PiP prevent is exactly the exact same 50/1 Leverage buying 2 lots with a 50 PiP stop. We both risk and lose the exact same amount! Leverage * lots purchased * PiP value * Stop Loss = Risk. I will RISK the specific same amount at 50/1 as you do at 500/1 if we have exactly the exact same stop. I just have to INVEST MORE. I also will MAKE the specific same amount as you can using a 500/1 account in a 50/1 account. Again, I just have to INVEST more. The only potential increase in risk might be that I've more on deposit with my broker at 50/1 than you do with yours at 100/1. So if my broker pukes I'll lose more. On the other hand, my brokers is less likely to go upside down because they have twice the liquidity as a 100/1 broker (I.e. twice up to deposit)
    In relation to your larger issue, the only other thing I would add to the equation is how long it takes to deposit funds. If I need to deposit funds I would like to get a couple of days worth of Buffer with my broker since sometimes it takes as many as two days for my deposit to show up. I wouldn't want to be held up from being able to follow along with my cash management egy just because I had been waiting for a deposit.

    Outside of that I see NO reason to depart extra funds with any broker. Set it in a savings account!

  7. #7
    There are many out there which can't grasp this idea. Perhaps it is possible to make it apparent for them Good Luck...

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