Problem Crunch time! My case with ICMarkets

[dkami]

@dkami, thank you very much for taking an active role on this post

No problem, I want to know exactly what happened to because as you know I have an ICM account and if there is anything dodgy going on here I want to know about it so I can change broker before I am put in the same situation!

I have only ever had 1 MC and that was with ICM but they did reinstate my trades but only after a few choice words and I defiantly don't want to go threw that BS again!

 

[Angus Jon Walker]

Rahman,

feel free to provide feedback on my last post so I can address any remaining concerns tomorrow.

 

[dkami]

Since we have the consensus of one FPA user I guess we can continue on... Thank you dkami.

No problem, as you have probably read in my last post @ RahmanSL I need to know nothing dodgy went on here just as much as he does!

And I must thank RahmanSL for coming forward with his claims and you Angus Jon Walker for coming on here and giving your side, Not many brokers do!

 

[RahmanSL]

No problem, I want to know exactly what happened to because as you know I have an ICM account and if there is anything dodgy going on here I want to know about it so I can change broker before I am put in the same situation!
I have only ever had 1 MC and that was with ICM but they did reinstate my trades but only after a few choice words and I defiantly don't want to go threw that BS again!

Yes, I remembered your post on your MC problem with ICM.
Since dabbling in the forex market for over 5 years and having through more than 10 different brokers, besides ICM, I had issue(s) with only one other broker, “Trading Point” now known as XM.com. The issue was about timely crediting of positive swaps and….after heated email dialog which eventually progressed to FPA site….they finally see my point, kinda admitted that they were somewhat in the wrong and, to my complete surprise, reinstated my entire trading account without me ever asking for that.
I really didn’t want to accept the reinstatement money and told them so in an email, but they told me it was a gesture of goodwill and I can keep it or trade with it as I wish. Well…hehehe….since I considered that as “money already lost” and “free money”, I traded recklessly on the account and, after more than doubling the account, wiped out the entire account ..
Needless to say, after the “resolution”, I posted my humble “issue resolved” on all the sites that I patronize and have posted prior comments on TradingPoint.

The broker I had a run-in with, but which I have not even started trading with, was ForInvest back when I first joined the FPA in early 2010. From a very innocuous enquiry question here at the FPA on “Have anybody heard of ForInvest” (or something equally innocuous like that, ForInvest rep/owner went on the war path…long story short, on 16/Feb/2010, ForInvest was nominated and voted “Scam Broker of the Year 2010” and have since then disappeared.

So now……after more than 5 years, >10 brokers, and multiple account stop/wipe-outs….I have another issue with one more broker, ICMarkets!

 

[RahmanSL]

Rahman,
feel free to provide feedback on my last post so I can address any remaining concerns tomorrow.

I really have nothing to comment at this point in time because you are posting and presenting proof to counter my believes.
After your final presentation, I will review and assess all your transparent and logical explanations and, from there, shall post my comments accordingly and, perhaps, to add in a few items/details which I have acquired recently and are relevant to the case.
In all fairness, I have not sent any issue report to any authorities and shall wait for the outcome at the FPA which I believe to be as fair as any arbitrators.

 

[Angus Jon Walker]

Finally my explanation on why you were really stopped out, why this was done without warning and what appeared to be seconds.

Since I took over this case I have stressed that the cause of the stop out was because of the size of the gross exposure relative to the accounts equity. Wide spreads are not the cause, these are simply incidental. In other words the account was on the brink of blow up, it just needed a market event in the form of a rally in the USDCAD or spread widening to speed up the process.

Gross exposure is the total of long and short positions. In Rahman’s case this was 2.9 lots long and 3.1 lots short for a total of 6 lots open exposure on USDCAD. Gross exposure is important as the bid ask rates in the platform will determine the unrealised PnL on all open positions. This means that when spreads widen the long and short positions will become worth less and quickly diminish the equity in an account.

The 6 lots gross exposure is equal to 600,000 USD. At the time of the stop out Rahman’s equity was approximately $220. This means the exposure on Rahman’s account was 2727 times greater than his equity. Obviously this kind of exposure doesn’t give the account a fighting chance since it only requires a modest increase in spreads to send the account into negative equity.

In the graph below you can see the bid/ask and unrealised PnL on Rahman’s account between 16:59-17:01, I have included a table in the top right of the graph so you can see the effect of the widening spreads from 16:59:50 to 16:59:51 (one second) where the account went from 284% margin level to a low of -36%. Over this second spreads increased from 2.8 pips to a max of 7.5 pips.

If an account goes from 284% to -36% margin level in a second then it is not reasonable to expect the platform to provide a margin call warning before any kind of stop out of open positions occurs. Both would have to happen at the same time to prevent the account going into a large negative and the client owing the broker money. Case in point would be the SNB drama in January this year.



Once the first liquidation occurred at 16:59:51 the server was correct in continuing to liquidate positions as the account had a negative equity and a growing used margin amount as hedges were unwound.

 

[dkami]

Case in point would be the SNB drama in January this year.

If I may ask what has ICM put in place after the SNB unexpected news to stop the false prices that you had but my other brokers did not have. I refer to the AUDCHF where ICM price on D1 dropped to 0.02178 but closed @ 0.68779 (my other brokers did not have this massive spike down both of which are claimed to be ECN also)?

ICM after reinstating my trades did assure me that they have put provisions in place to prevent this false pricing from happening in the future. Can you please elaborate to what has been put in place?

 

[Angus Jon Walker]

If I may ask what has ICM put in place after the SNB unexpected news to stop the false prices that you had but my other brokers did not have. I refer to the AUDCHF where ICM price on D1 dropped to 0.02178 but closed @ 0.68779 (my other brokers did not have this massive spike down both of which are claimed to be ECN also)?

ICM after reinstating my trades did assure me that they have put provisions in place to prevent this false pricing from happening in the future. Can you please elaborate to what has been put in place?
View attachment 20620

I think it would more appropriate to do this off this thread. I do not want to distract Rahman and readers from the last four pages of discussion.

You can PM me if you want an answer and you can post it elsewhere.

 

[RahmanSL]

Finally my explanation on why you were really stopped out, why this was done without warning and what appeared to be seconds.

Since I took over this case I have stressed that the cause of the stop out was because of the size of the gross exposure relative to the accounts equity. Wide spreads are not the cause, these are simply incidental. In other words the account was on the brink of blow up, it just needed a market event in the form of a rally in the USDCAD or spread widening to speed up the process.

Gross exposure is the total of long and short positions. In Rahman’s case this was 2.9 lots long and 3.1 lots short for a total of 6 lots open exposure on USDCAD. Gross exposure is important as the bid ask rates in the platform will determine the unrealised PnL on all open positions. This means that when spreads widen the long and short positions will become worth less and quickly diminish the equity in an account.

The 6 lots gross exposure is equal to 600,000 USD. At the time of the stop out Rahman’s equity was approximately $220. This means the exposure on Rahman’s account was 2727 times greater than his equity. Obviously this kind of exposure doesn’t give the account a fighting chance since it only requires a modest increase in spreads to send the account into negative equity.

In the graph below you can see the bid/ask and unrealised PnL on Rahman’s account between 16:59-17:01, I have included a table in the top right of the graph so you can see the effect of the widening spreads from 16:59:50 to 16:59:51 (one second) where the account went from 284% margin level to a low of -36%. Over this second spreads increased from 2.8 pips to a max of 7.5 pips.

If an account goes from 284% to -36% margin level in a second then it is not reasonable to expect the platform to provide a margin call warning before any kind of stop out of open positions occurs. Both would have to happen at the same time to prevent the account going into a large negative and the client owing the broker money. Case in point would be the SNB drama in January this year.

View attachment 20619

Once the first liquidation occurred at 16:59:51 the server was correct in continuing to liquidate positions as the account had a negative equity and a growing used margin amount as hedges were unwound.

Is that all you have for the irrefutable proof that the widen spread on USD/CAD did occurred on the date and time which I have been asking for since 5/Mar/2015 from ICM Support (Tony Phung, Elena Bushueva, and Sung Choi), and then from you?
Do you have anymore "irrefutable" evidence to submit?

 

[Angus Jon Walker]

Is that all you have for the irrefutable proof that the widen spread on USD/CAD did occurred on the date and time which I have been asking for since 5/Mar/2015 from ICM Support (Tony Phung, Elena Bushueva, and Sung Choi), and then from you?
Do you have anymore "irrefutable" evidence to submit?

Rahman, I've asked for your feedback. If you're not happy with the information provided then the onus is on you to tell me so I can provide the information that you do want.