Dirk Groenewald
Forum Newbie
News Trading and “slippage”.
“This type of trading requires a fast reaction, a good broker that allows you to trade the news and gives you a good fill with minimum slippage”
My question. Wat is the best thing to to when trade news breakouts?
I speak to Go Market Australia. Here is the conversation.
Jan Frederik Groenewald
If I have let say 2 000 USD in my account and a slippage happen. Can I lose more than my bank account of 2 000 USD?
Sam
You will receive an email if your free equity is below 80% and if it falls below 50% your biggest losing position will be closed out.
Jan Frederik Groenewald
What I mean is when a spick of 200 pips happen within 1 sec and is much more than my account?
Sam
Yes it's possible for your account balance to go negative
Jan Frederik Groenewald
What will happen then?
Is there an insurance to cover that?
Sam
Your account balance would go negative
Let me check something Jan
No our company doesn't offer any type of insurance for this
Jan Frederik Groenewald
If I got money in another account. Go Market will take that money as well to cover losses?
Does it happen a lot?
Sam
We have a general disclaimer that states: Trading Forex and Derivatives carries a high level of risk, including the risk of losing substantially more than you initial expenditure.
Jan Frederik Groenewald
If I lose a lot of money and go in negative. How will you recover that money if I haven’t got it?
Just a question....
Sam
It's your responsibility to manage your risk and leverage. I think in general it depends on the situation.
Best to contact Rom your account manager, [email protected]
He would be able to provide additional information.
Sam
But in general it's hard to answer a hypothetical question. The black and white answer is that if your account balance is negative than you are responsible.
How we'd collect the negative balance depends on a lot of factors. Thus important that you have adequate margin to cover any such event.
Jan Frederik Groenewald
If I have a margin of say 5 000 USD and use Risk Reward of not more than 2% of my account. Can a slippage with news go so high to take all of the account?
Sam
Yes absolutely it's within the realm of possibility. I believe it was November.. we had the GBP flash crash.
I worded that a little strongly, Jan. Yes, anything is within the realm of possibility. But I as a company employee could not write and say it's impossible.
We do not offer negative balance guarantee, other companies do though.
Jan Frederik Groenewald
Does that happen often?
Sam
Also a flash crash with the Swiss Franc in 2015
These are the two that are coming to mind from the past 2-3 years
Jan Frederik Groenewald
Thanks for your information.
Sam
No problem Jan. I don't want to scare you away, events like these are rare. But trading FX does carry this risk.
Jan Frederik Groenewald
Thanks
What is the right thing to do. I trade now life for about 1 month and trade the London breakout. strategy on GBP/USD. This cross my mind after reading "News Profiteer’s Definitive Guide to Fundamental News Trading" by Henry Liu.
“This type of trading requires a fast reaction, a good broker that allows you to trade the news and gives you a good fill with minimum slippage”
My question. Wat is the best thing to to when trade news breakouts?
I speak to Go Market Australia. Here is the conversation.
Jan Frederik Groenewald
If I have let say 2 000 USD in my account and a slippage happen. Can I lose more than my bank account of 2 000 USD?
Sam
You will receive an email if your free equity is below 80% and if it falls below 50% your biggest losing position will be closed out.
Jan Frederik Groenewald
What I mean is when a spick of 200 pips happen within 1 sec and is much more than my account?
Sam
Yes it's possible for your account balance to go negative
Jan Frederik Groenewald
What will happen then?
Is there an insurance to cover that?
Sam
Your account balance would go negative
Let me check something Jan
No our company doesn't offer any type of insurance for this
Jan Frederik Groenewald
If I got money in another account. Go Market will take that money as well to cover losses?
Does it happen a lot?
Sam
We have a general disclaimer that states: Trading Forex and Derivatives carries a high level of risk, including the risk of losing substantially more than you initial expenditure.
Jan Frederik Groenewald
If I lose a lot of money and go in negative. How will you recover that money if I haven’t got it?
Just a question....
Sam
It's your responsibility to manage your risk and leverage. I think in general it depends on the situation.
Best to contact Rom your account manager, [email protected]
He would be able to provide additional information.
Sam
But in general it's hard to answer a hypothetical question. The black and white answer is that if your account balance is negative than you are responsible.
How we'd collect the negative balance depends on a lot of factors. Thus important that you have adequate margin to cover any such event.
Jan Frederik Groenewald
If I have a margin of say 5 000 USD and use Risk Reward of not more than 2% of my account. Can a slippage with news go so high to take all of the account?
Sam
Yes absolutely it's within the realm of possibility. I believe it was November.. we had the GBP flash crash.
I worded that a little strongly, Jan. Yes, anything is within the realm of possibility. But I as a company employee could not write and say it's impossible.
We do not offer negative balance guarantee, other companies do though.
Jan Frederik Groenewald
Does that happen often?
Sam
Also a flash crash with the Swiss Franc in 2015
These are the two that are coming to mind from the past 2-3 years
Jan Frederik Groenewald
Thanks for your information.
Sam
No problem Jan. I don't want to scare you away, events like these are rare. But trading FX does carry this risk.
Jan Frederik Groenewald
Thanks
What is the right thing to do. I trade now life for about 1 month and trade the London breakout. strategy on GBP/USD. This cross my mind after reading "News Profiteer’s Definitive Guide to Fundamental News Trading" by Henry Liu.