Why not have the bank balanced matched to the Brokers statements via a computer that then flags inconsistencies, In this day and age this is a "no brainer" Are these regulators still wearing green visors working on big black ledgers?
Good point, Jura. If you used this approach, you would have to be careful to make sure that the different brokers were clearing firms themselves, or were associated with different clearing firms. Some of the small IBs have the same clearing firm, so that doesn't buy you extra protection. The big firms cover all the markets, so access to markets you need should not be a problem. And yes, you might have multiple platforms. I use Tradestation, Ninja Trader and CTS as platforms.
It is definitely easier to have all your accounts at one broker. But for me, having 3 brokers (now 2, I guess) saved my livelihood. At least for a little while...
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my thoughts go to all affected traders, hopefully the backup account is ready to battle through those tough times. If one reads through this list closely, you come to realize there was at least a foreshadow building up...
.. I don't have an account with PFG, but feel sorry for all who have and I'm worried about the industry overall.
If regulators don't take serious action now (should have done last year already), the retail futures industry will go down the drain. Third-party auditors - which are not chosen and paid by the brokerage firms! - with monthly auditing would be the best way to go IMO. Even if it makes trading for all of us more expensive (e.g. through a fixed monthly fee all brokers to cover for the auditing costs of the industry, which they would surely pass to us clients).
The mentioned solution to pull money out of the account on a regular basis and only leave the minimum margin in makes only sense if you have already reached a "comfortable" account level. Otherwise compounding is not possible ... and I guess that's why most of us are in this business...
I have an account at TradeStation. They say they have excess SIPC insurance policy in place for futures and forex accounts with coverage up to $300m. However, I still do not feel secure given this recent news in such short period of time as I do not know whether the insurance will really work in case of fraud...
As far as I understand, the large investment banks don't provide brokerage services to small retail clients, right? Although fraud would be possible at such firms as well, I would FEEL more secure with my money at such big institutions (Goldman, Merrill, etc.)...
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