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What if you lose money as result of platform issues?
We all know software programs have bugs. Some bugs are nastier than others. Trading system infrastructures also tend to be complex nowadays.
Have you ever experienced a problem with your trading platform that, after vendor analysis, was established to be a software/system issue, and a result it cost you money?
Examples of issues costing you money may include
Inability to place a stop loss
Your stop loss not being filled (not because of slippage but because of an issue)
Getting filled at different prices than the ones your platform told you you were filled
Inability to trade
There may be other examples too.
If it happened to you, how did you approach the issue? Are you entitled to ask the vendor for compensation?
Can you help answer these questions from other members on NexusFi?
Every professional platform and broker I've ever come across exclude such claims in their fineprint.
The customer has to take care of emergency measures - via phone etc in a pinch. Only if all of these
measures don't work (e.g. because your broker cannot be reached by any thinkable device), claims
can arise.
Different with bucket shops like CFD dealers: Here you normally have some discretion
depending on your position (e.g. heavy trader) and on the fact that CFD platforms
normally aren't neutral.
Cheers,
choke35
P.S.: The answer assumes a retail trader's platform. The situation is different for professionals
who regularly pay for SLAs to avoid/mitigate such accidents.
Agreed with your post. I am not a lawyer, but I believe the clauses in the fine print may be set aside in the case of gross negligence or deceit. However, this would depend on the laws that are applicable to the jurisdiction and even this can get tricky, i.e. if you use a US-service provider could you pursue legal action in the UK? Also, if I recall correctly from my university studies, the onus was on you to prove negligence or deceitful behaviour.
Thus in most cases it would not be worth it to pursue legal action. If you do ask for a refund for your losses due to platform issues, it would be entirely up to the discretion of the service provider.
Unless you can prove gross negligence or deceit then it is most likely the case. However, I would expect any proper trading platform to at least get the prices right where trades executed. That could suggest basic functionality that should have been properly tested not being tested (negligence) and depending on which laws apply you may have a case.
Regarding the losses due to inability to place stop-losses, you probably have no case since you could have gone to your broker directly. Regarding losses due to the stops not executing, under normal cases there is no guarantee that you will get decent fills, so I would expect that you stand a very slim chance here. Regarding the inability to trade, you could have contacted your broker directly and probably have no chance here as well.
If the losses are substantial, you could contact a lawyer to determine your options, but I would just find a different service provider.
