Problem Squared Financial Services Limited

[ABV]

Eddiger,
A "disgrace" may bit a bit harsh, it is not as if this happens every month on our platform. .. just as an exchange going down momentarily, a fat finger order over the telephone, or engine problems on a new car.... it happens some times, gets repaired, and preventive measures may be taken in some cases, and then you carry on with business.

Several times I asked you how many times in your entire history such spread - 200+ pips was recorded?
How many times have you answered to me?
No one.
What is that mean?
I think You are not telling the truth and this is an exceptional event, which has never happened before.

And a few words about my

poor understanding of market mechanisms…

how this poor lad is having such difficulty trying to wrestle with a financial statement.

Tell me, please, dear Hed of Legal... Can you predict the future? I suppose, you cann't.

Tell me, please, dear Head of Legal... Do you know, that each trader incurs losses immediately at the opening of any order due to the spread and commissions? I hope, you do.

Eddiger,
Again, our client did not incur a loss as a result of this event. Any executions caused by this event were cancelled, but the client incurred other trading losses from his own initiative, and it seems he would like us to pay for those, under the pretext of this wide spread event.

Tell me, please, dear Head of Legal... Do you know any trading strategy, which can exist without losses from time to time?
I'm sure, you don't.

You are thinking that your

client has confused "closed balance" and "net equity value".

Be sure, I'm not confused.

I'm talking about, that your actions and/or inactions have broken my strategy.
And I can't restore it.

If you immediately regained all positions, my strategy was saved and now and I would get a fat profit.
You promissed me that you will do it at the morning.
Did you do that?
No, you didn't.

Can I restore my strategy now?
I can't.
Who is respobsible for this?
Am I?
No, you are.

Did I ask you you to close my positions and brake my strategy?
No, I didn't.
You made ​​it yourself, because it was profitable to you.


So, Dear Head of Legal... now I'd like to receive the answers to all my question written on the previous page #5.

After that we can move forward and check some orders.

 

[Head of Legal&Compliance]

Listen if it took you two days to reimburse the client and during this time he couldn't trade because he didn't have enough to trade I would say he might have a case here.
If he had enough to trade then his case would be weak in my opinion.

The client was able to trade. The wide spread event did not wipe out his all of his trading account, and he still had margin available for trading, but obviously, the losses incured by the wide spread event were not available for trading untill the reimbursement took place.

You say "he might have a case here". A case for what precisely ? I can only infer that you are making referrence to the legal theory of "loss of chance". Might you propose that we reimburse him now for "lost chance" of a trade (ie a hypothetical trade he may or may not have have put on)? If so, which lost chance (ie which pair, long or short, which size) could you imagine that we reimburse him for ? Moreover, the theory of lost chance also states that the calculation of damages is the question of causation. Remoteness will defeat a claim if it depends on very hypothetical possibilities... as you can see, we are indeed in the realm of very remote hypothetical possibilities, as opposed to a proper certain qualified chance.

 

[Head of Legal&Compliance]

For the record, I did not promise anything to the client at all regarding cancellation or establishment of positions. In matters like these one is supposed to do what is right and according to procedures, which we did. We are not in the business of making bargains with clients which are contrary to fair business pratice and contrary to mathematical and economic realities.

This guy also still fails to understand that we were acting in an agency capacity, and thinks that we profited from his loss. The reality is that the liquidity provider initially profited from his loss, but then the trade was cancelled and both parties (client & liquidity provider) ended up as if nothing happened regarding those trades in question.

 

[ABV]

For the record, I did not promise anything to the client at all regarding cancellation or establishment of positions. In matters like these one is supposed to do what is right and according to procedures, which we did. We are not in the business of making bargains with clients which are contrary to fair business pratice and contrary to mathematical and economic realities.

This guy also still fails to understand that we were acting in an agency capacity, and thinks that we profited from his loss. The reality is that the liquidity provider initially profited from his loss, but then the trade was cancelled and both parties (client & liquidity provider) ended up as if nothing happened regarding those trades in question.

This guy understands the simple truth: actions of the debtor's employee is equal to the actions of the debtor.
That's why actions or promises of your employees are actions or promises of your company and your actions including.

Did you promiss me that you will restore all positions at the morning.
Yes, you did.
Did you restore positions at the morning?
No, you didn't.

Will you give the answers to my questions or I can loudly speak that anything what you saw on the previous pages is a lie?

 

[ABV]

The client was able to trade. The wide spread event did not wipe out his all of his trading account, and he still had margin available for trading, but obviously, the losses incured by the wide spread event were not available for trading untill the reimbursement took place.

You are mistaken.
No one will trade as long as he does not understand what's going on.
You promised to cancel the deals, but did not do it.
How the client can know that everything is working as usial.
Especially since he had just seen that it's not working as usual.
Maybe you'll expand spread up to 200+ pips (4 digits) after each order...
Much better to lose 30,000 from 36,000, than to lose the entire 36,000... Am I right?

And I forgot about the main thing, my account is closed so I can not get any information related to my account.

 

[Master Yoda]

Look ABV, mistakes do happen in every company. In my opinion, if they managed to reimburse you and they did it means they were doing their job (a long the 204 pips issue was an innocent case) although I think 2 days to cancel these positions was a bit longer than the usual, however I know many companies who won't even do that. Let me ask you a question: say there was no this spread widening what could happen with your position? just have a look in the charts and see.
Bottom line, as long they canceled the position and gave back your money they were ok, they dealt with the crisis with a fashionable late, but at least they did.
About the contract termination- after this incident I don't think you both wish to work together anyway and after all.

 

[ABV]

Let me ask you a question: say there was no this spread widening what could happen with your position? just have a look in the charts and see.

Could you ask this question another way? I'm not sure I understand it.

And one more, please

Let's wait an answers on my questions of Head of Legal... and then I'll show you that he is lying and my losses
order by order

 

[Pharaoh]

I have a very simple question for either ABV and/or Squared Financial:

Did the lack of availability of funds from the trades that were spiked out by that pricing issue have anything at all to do with the other losses? I.E. Was the lack of funds somehow responsible for a margin call or for the client closing to avoid a potential margin call?

 

[Master Yoda]

according to the company rep- No
My point about "loss of chance" is to compensate the customer somehow and not reinstate position by giving him the best closing price.

 

[Head of Legal&Compliance]

I have a very simple question for either ABV and/or Squared Financial:

Did the lack of availability of funds from the trades that were spiked out by that pricing issue have anything at all to do with the other losses? I.E. Was the lack of funds somehow responsible for a margin call or for the client closing to avoid a potential margin call?

Pharaoh,

Your question is perfectly pertinent. I verified this and, some pre-existing trades were indeed closed out, but reinstated by our dealing desk. There could be some confusion here for the client on this point as he was using that "hedge" gimmick on MT4. In sum, he had a net position of X, originally composed of several trades. That net positions was closed due to the system detecting insufficient funds (erroneously). However, our dealing desk reinstated the net position (and not the original composition of a mix of long & short positions... though this is economically identical), therefore creating a crystallised P/L in his account which was offset by the corresponding new floating P/L.

Off topic a bit, but anyone using that stupid "hedge" gimmick on some front end interfaces needs to review their addition and subtraction skills... that gimmick serves nothing other than to provide some sort of sentimental comfort to somehow make people feel they are not crystallising a loss. The economic reality of the matter is an account is always net a given currency, and that is the measure of the performance. Also, some brokers like to promote that silly "hedge" gimmick as it gives them extra commissions and extra roll fees. I seriously question the math and accounting skills of anyone using those "hedge" gimmicks.... they are not actually "hedge", but rather off-set the pre-existing position (I could go on here, but I digress, and this is not the topic at hand). By the way, Squared does not offer or promote that so-called "hedge" gimmick.. it is simply imbedded in certain third party front ends which are available to our client's.

The fact is that Squared acted professionally, and in the best interests of the client.

I have no problem debating or even being proven wrong. Unfortunately, the client we are dealing with in this case is uncooperative and will not stick to the point of debate. The guy has not even evidenced his accounts here yet for review.

As a result, I can no longer discuss matters with the client as he is just insulting, doesn't get the "agency" concept, and is trying to pass us off as underhanded and dishonest. He has proven that it is futile to attempt to debate technical issues, such as his account statements and how OTC liquidity pools work (or fail to work properly from time to time).

I must now give my time to our existing clients.

Anyway, I have given this matter adequate time, attention and explanation which should demonstrate that we did our best to serve the best interests of the client subsequent to a ****ty and disruptive event.