Problem Crunch time! My case with ICMarkets

[RahmanSL]

...continue files attachment 6 to 10 of 14

 

[RahmanSL]

...continue files attachments 11 to 14

 

[Angus Jon Walker]

This is very hard to judge without all the details if the MC was justified or not for eg. All trades on the account before the time of MC, balance and Equity and the total margin you had in the market

Agreed. I'm unable to properly explain our position as i can't state the numbers before and during the stop out. Rahman must post this information before I can do this.

@ RahmanSL Now from what ICM Representative has said the MC was due to Equity, So really need to know what your Equity was and how much margin you had in market because if your Equity goes below your margin well it's game over! (I know you already probably know this but I'm just pointing it out)

Yes, its a combination of the equity, used margin and the gross exposure. As pointed out to Rahman via email, the biggest problem in situations such as this is the gross exposure. When spreads widen during news your gross exposure will cause longs and shorts to be worth less and your equity to diminish rapidly. If your gross exposure is over two thousand times greater than your equity then you can expect something such as an entire account liquidation and negative balance...

On the 1st attachment (ICM 1min chart) from the high to where the MC accrued is only a small margin 10-15pips (I note you were short) and with the MC @ time of CAD news would really need to know the spread,could it have had a 20pip spread @ time of MC well I'm not sure it would have been that high but I would presume the spread would have widened some as it usually does during news

The spread during the news release when Rahman was stopped out was 7 pips. This is within the normal range for the USDCAD during news releases. See attached example from last weeks data releases. Again, the spread increase was not large or abnormal and the stop out and negative balance was caused by the large gross exposure relative the account's equity.

@ Angus Jon Walker What is ICM margin requirement's for eg. Does ICM close positions when Equity equals margin, below margin or is it higher?

The margin call is at 120% margin level, margin stop out is at 80% margin level.

Margin level = equity/used margin

 

[dkami]

Agreed. I'm unable to properly explain our position as i can't state the numbers before and during the stop out. Rahman must post this information before I can do this.

Yes I get that it's a privacy issue, But this is what we all need to see!

So can I suggest to get this info. on this thread if you can send all the info. you have for your case that you fairly (without any manipulation) gave the MC (stopped out) to RahmanSL via email and then if you RahmanSL copy & paste it to this thread? (you can leave out names, account numbers ect,ect that you wish to keep private)

I'm still on the fence about this MC as the spread of 7pips is not very extreme but without knowing all trades long and short, (read RahmanSL said this was a hedging account in post 6) Balance,Equity and the margin used we will never know!

 

[Angus Jon Walker]

read RahmanSL said this was a hedging account in post 6

Yes, this is what Rahman has been posting all over FPA and what he claimed to our support team until I took over his case last month. An account is not assessed for margin call/stop out if it is fully hedged. I'll wait for Rahman to post the trades or allow me to disclose certain information before provide all of the details.

Edit: If an account is fully hedged then there is no used margin and no margin level can be calculated. A setting in MT4 allows brokers to disabled the assessment of fully hedged accounts for margin call/stop out and we have this feature enabled. If an account has used margin then it is assessed for stop out as there is a margin level. Products such as CFDs and metals which do not have a margin hedge of 0.00 will always be assessed for margin call/stop out as they will always have a used margin component. I hope this clarifies.

 

[RahmanSL]

To ICM Representative Mr. Angus Walker - Head of Trading Desk - IC Markets.

Now that we finally get a most senior representative from ICM to grace his presence here at the FPA, let’s just post everything here on this thread for the community judgment.
You/ICM have my full and total permission to post whatever you/they need to prove that ICM did not carry out any shady manipulations on my ICM trading account no. 317165, and I presume and expect ICM to give me the same liberty to do the same.

We all know and should know that account margin-call, force closures of largest to smallest open positions, and eventual stop-out will happen when account drops/go below broker’s required margin & equity level (these are preset at different levels by different brokers)….and ICM went to great lengths to lecture me on the mechanism on the “how, why, and when” but leaving out the most crucial and important issue I have with them which lead to this long and tiring drawn out issue which increasingly make me more frustrated and agitated with this, as I see it and have already start to believe, I-See-Bucketshop broker.
As I have mentioned many times, this used to be a good broker and, once-upon-a-time, I cannot say enough good things about them and, as can be seen from my trading account with them, time and again I would recapitalize after each account stop-out. I also have a few more other accounts with them over the course of the year that I have been with them.

My main issue with ICM:
The crux of my issue with ICM is whether there was/is indeed sufficient market movements on the USD/CAD to cause instantaneous account stop/wipe-out with absolutely no margin-call warning and sequential force closures of largest to smallest losing positions on 5/Mar/2015 just before and during the time of following key economic news events:

5-Mar-2015, 23:00 - US Factory Orders (MoM) - Previous: -3.5% - Consensus: 0.2% - Actual: -0.7%
5-Mar-2015, 23:00 - Can. Ivey Purchasing Managers Index - Previous: 42.60 - Consensus: - Actual: 50.80
5-Mar-2015, 23:00 - Can. Ivey Purchasing Managers Index s.a - Previous: 45.40 - Consensus: 50.00 - Actual: 49.70
5-Mar-2015, 23:00 - US FOMC Member Williams speech
5-Mar-2015, 23:00 - Hungary Budget Balance - Previous: 53.80B - Consensus: - Actual: 256.90B

If FPA members have any information on actual market movements on USD/CAD on the above date & time, your input/contribution(s) here would be most appreciated and welcome.
All those MT4 and jforex charts (on next post) that I have posted (and emailed to ICM Support) do not show that much volatility on USD/CAD on the day and time mentioned.

 

[RahmanSL]

Originally sent to ICM Support on Fri, Mar 6, 2015 at 2:39 PM :

Dear Tony,
I have attached 5 attachments showing trading account 317165 almost immediately when the account was wiped out, and few minutes later to show that there wasn't really very much movements in the market when that happened.
Two screenshots are trading platforms two other brokers (taken some minutes later) that basically show that the USD/CAD has no spikes and sudden price movements at the material time too.
Besides ICMarkets, I was also trading on a couple other brokers' trading platform and was switching back and forth monitoring my ICMarkets trading account to ensure that the level of free and available margin are good and that it does not require additional recapitalization.
The last time that the account was also wiped out in a very similar manner (i.e all hedged positions and on one single currency pair) and the explanation given by Sung Choi was really not very convincing to me, but I was not monitoring the trading account when that happened and so was unable to dispute that event.
However, this time the account sudden wipe-out happen almost before my eyes and I really am quite shocked & puzzled by what had happened.
Please do look into my case carefully this time because I think there might be something going on in the trading platform which causes such happenings without warning which might be very difficult to explain.
Another strange event which Sung Choi has also not adequately explained to me was how the same pending order currency pair was triggered on one of my ICMarkets trading account but not on another ICMarkets trading account. It was triggered way above what was shown and recorded on the MT4 trading charts, and the pending position that was triggered eventually wiped out that account too.

 

[RahmanSL]

Yes, this is what Rahman has been posting all over FPA and what he claimed to our support team until I took over his case last month. An account is not assessed for margin call/stop out if it is fully hedged. I'll wait for Rahman to post the trades or allow me to disclose certain information before provide all of the details.

Edit: If an account is fully hedged then there is no used margin and no margin level can be calculated. A setting in MT4 allows brokers to disabled the assessment of fully hedged accounts for margin call/stop out and we have this feature enabled. If an account has used margin then it is assessed for stop out as there is a margin level. Products such as CFDs and metals which do not have a margin hedge of 0.00 will always be assessed for margin call/stop out as they will always have a used margin component. I hope this clarifies.

And while you are going on about “widening of spreads, etc, etc” just before and during the date & time in question, you/ICM should also provide what was the spread and market movements just prior to the time of those 5 economic news releases….ie for 1) ECB Monetary Policy Statement & Press Conference, 2) US Nonefarm Productivity, 3) US Unit Labor Costs, 4) US Continue Jobless Claims, and 5) US Initial Jobless Claims…as these have gret effects on USD/CAD as well and, judging from the attachment chart, was more volatile. If any account margin-call and stop-out was to occurred, then logically that should have happened during those more volatile market movements (which, based on my experiences, I doubt anywhere)

 

[Angus Jon Walker]

Now that we finally get a most senior representative from ICM to grace his presence here at the FPA, let’s just post everything here on this thread for the community judgment.

Rahman, I'm here to provide irrefutable evidence that the liquidation on your account was correct. This is not the recommended course of action for any client seeking mediation by an independent third party as FPA it is not independent, this forum and any decision made in it is non binding and there is a distinct conflict of interest between all parties.

IC Markets has made it clear to Rahman that he should seek mediation through our external dispute resolution service FOS, however, this notion was rejected.

IC Markets has requested Rahman removes his misleading and defamatory posts about IC Markets on FPA and other sites if it is found that the stop out was correct. He has indicated that he would 'gladly make the time carry out "damage control" to what I have posted on ICM'.

My next post will cover the stop out in detail.

 

[Angus Jon Walker]

Firstly we must establish the cash, equity, used margin, margin level, net and gross position before the stop out. These have been provided to Rahman, however, there has been no acknowledgement to date that any of these are correct.

Second, if we can agree that the above information is correct then we can proceed to analyse the the equity on the account at the times Rahman has indicated

1. 15:30 - News release: Nonfarm productivity, Unit labor costs, Initial jobless claims, continuing claims
2. 16:00 - USDCAD swing high at 1.2486
3. 16:59 - Stop out - News release: US factory orders, CA Ivey purchasing managers index


Cash $5,576.84
Equity $202.21
Used margin $51.02
Margin level 396%
Net position 0.2 lots short USDCAD
Gross position 6.0 lots USDCAD (long 2.9 lots, short 3.1 lots)

Cash - the cash is determined by the current balance of -$30.27 - -$5607.11 (the net PnL from the stop outs). This gives us $5576.84.

Equity - this is determined by the cash + unrealised net PnL. For this calculation we have assumed a bid rate of 1.24604 on all long positions and an ask rate of 1.2461 on all short positions.

Used margin - This is equal to net lots * the contract size * the account leverage / AUDUSD exchange rate to convert the USD margin amount in to AUD.
Used margin = 0.2*100000*0.002/0.78406
Used margin = $51.02 AUD

Note: the margin is determined by the value of the base currency on any FX trade.

Margin level this is equal to equity / used margin
Margin level = 202.21/51.02
Margin level = 396%

Net Position is equal to long USDCAD positions minus short USDCAD positions
Net Position = 2.9-3.1
Net Position = -0.2 lots

Gross position is equal to longs plus shorts
Net Position = 2.9+3.1
Gross Position = 6 lots

I have attached a spreadsheet that has been modified to show these calculations only. Again, once we can agree on this information we can progress to the second stage.

https://www.dropbox.com/s/a9fxs4f5t8ve64t/Rahman Stop Out FPA 1.xlsx?dl=0