Over a hundred Australian foreign exchange traders fight to avoid millions in losses
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Updated February 17, Here in Australia — and around the world currency trader jobs australia foreign exchange firms are selling the dream of instant riches. But for hundreds of Australia's 51, mum and dad retail forex traders, that dream has turned into a nightmare.
The ABC can reveal that more than retail foreign exchange traders in Australia — often small investors who dabble in the forex market in their spare time — have suffered massive losses on their trading accounts. On January 15, the Swiss National Bank sent foreign exchange markets into a spin when it unexpectedly removed a cap on its exchange rate.
The cap was in place to stop the Swiss franc appreciating too much. The franc was seen as a safe haven, and an overvalued currency would make its domestic economy uncompetitive, and hamper economic growth. When the cap was unexpectedly removed, the franc appreciated by 30 per cent in an instant against the euro, and foreign currency currency trader jobs australia holding the franc made windfall gains.
But those on the other side of the transaction were left scrambling to cover their losses and, in the case of some of the world's biggest foreign exchange trading firms, exposed to hundreds of millions of dollars in losses. FXCM's clients accept that they were liable to lose the capital they had contributed to their foreign exchange trading accounts. However, they argue that FXCM had a widely-advertised policy of "no negative or debit balances", and its poor risk management led to losses spiralling out of control.
It is FXCM's policy to credit retail trading accounts to a zero balance when debit balances currency trader jobs australia as a result of trading. One of the greatest concerns traders have about leverage is that a sizable loss could result in owing money to their broker. At FXCM, your maximum risk of loss is limited by the amount in your account. All accounts are tracked by our "Margin Watcher" feature.
With the Margin Watcher feature, if account equity falls below margin requirements, the FXCM Trading Station will trigger an order to close all open positions. FXCM's aggrieved Australian clients argue that other brokers navigated the Swiss franc shock in much better shape than FXCM because they had better risk management practices in place, and their clients' accounts were closed out currency trader jobs australia before losses spiralled out of control.
Because currencies tend to move in small increments, foreign exchange traders use currency trader jobs australia, or borrowing, to accentuate currency trader jobs australia profits. However, with leverage comes the risk of greater losses when currencies move against the trader. FXCM has confirmed that of its 16, Australian clients had a negative balance as a result of the Swiss franc event. The company said it has notified 10 clients that their negative balances need to be repaid.
In the wake of currency trader jobs australia global financial crisis, the United States put a handbrake on the retail foreign exchange industry, limiting it to a maximum leverage ratio of The Australian Securities and Investments Commission says the question of greater currency trader jobs australia is one for Government, but it has repeatedly currency trader jobs australia consumers that leveraged foreign exchange trading is a risky product. However, victims of the Swiss franc meltdown argue that ASIC should have policed the industry more thoroughly.
Because this time it happened in the currency space, but who knows what is the next time bomb? First posted February 12, If you have inside knowledge of a topic in the news, contact the ABC. ABC teams share the story behind the story and insights into the making of digital, TV and radio content. Read about our editorial guiding principles and currency trader jobs australia enforceable standard our journalists follow.
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Sydney has its own team of highly skilled seafarers tasked with guiding the world's biggest ships into one of the world's busiest harbours. Communication difficulties are a fundamental part of the autistic experience. Putting them into situations that exacerbate those difficulties isn't going to provide employers with the ideal impression of autistic job seekers. Exclusive by business reporter Neal Woolrich. Australian retail foreign exchange traders lost millions due to the Swiss franc's sudden appreciation last month.
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