Issue of unusual gaps & big spread have caused my account to be stopped-out and broker does not want to take responsibility.
Account number: 310150107
Date of Issue: 21 June 2021 (Monday)
Time of Issue: est. 0500hrs – 0530hrs (GMT+8)
Before the market open on 21 June 2021, my account status is having a drawdown of approximately 84% and Free Margin (%) of approximately 90-100+%.
I am well aware that FBS stops-out if Free Margin (%) reaches below 20%.
At the moment, I have open trades of several currencies and its volumes
1. EURUSD - 55.75 lots (long) & 55.75 lots (short)
2.CHFJPY - 95.94 lots (long) & 95.94 lots (short)
3.AUDUSD - 90.96 lots (long) & 90.96 lots (short)
4. AUDNZD - 31.97 lots (long) & 31.97 lots (short)
5. NZDUSD - 55.75 lots (long) & 55.75 lots (short)
Total volume = 660.74 lots
In short, all my positions are in direct hedge (perfect hedge) with margin level above 90%.
I was up ready to monitor and do additional trade management before 0500hrs on 21 June 2021.
But unfortunately, immediately during the market open, I witness my account got stopped-out due to an unusual big gap and spread of the FBS trading platform.
2 very unusual event that happen during 0500hrs (GMT+8) 21 June 2021 which caused by account to get stopped-out:
Event 1 - CHFJPY - a very big and unusual gap down with high volume first candle of 57 pips!
I have 2 questions here: I have checked with several brokers, but:
a. how can an A-Book broker have so much difference with other A-Book broker?
b. other brokers also offer the same account type which also comes with floating spread but no issue like this?
Event 2 - AUDUSD - an almost 20 pips spread on a major pair during market open
- I have also cross checked with several other brokers and do not have this issue for the similar account type.
- If we're talking about price feed, FBS's email did mention "UBS, Nomura, Bank of America, JP Morgan Chase, Goldman Sachs, HSBC and City Bank", which I'm not sure if they are FBS's liquidity providers.
But I want to ask the general public here in the same field:
The listed names of liquidity providers almost the biggest and the only few reputable liquidity providers in the market.
a. Is there any brokers who do not use them as liquidity providers?
b. How different is the price feed that FBS with other brokers?
I contacted FBS support via live chat to ask them to recover my positions and they asked me to write in to email@example.com for claims and further problems and my case was handled by L (lets name here L for privacy purpose), a Support from FBS. I explained the entire situation and L kept sending over terms of the FBS agreements. Of course I am well aware that I have agreed to an agreement, and it happens the same with all other brokers as we will have to first agree to the risks we take (agreeing to the agreement) before we could proceed.
But the problem is there is no similar issue (unusual gap, big volume candle, big spreads) which is so visually different at other brokers.
As a trader, we all understand that there is spread widening during times when market is close/have no liquidity and it is normal to have floating spread for my account type. At the current situation of my account, it would not be stopped-out if there's no issue with CHFJPY and AUDUSD at the morning, and all my trades would have been closed in profit according to my trading plan.
15/7/2021 Update :
FBS's Support, L, replied to me via email highlighting issue by issue and I summarize:-
1. My account margin is reduced to 19.7 when I got stopped out
2. FBS has a 50% margin requirement on hedged positions
3. Reminding me of my account type has floating spread and depending on liquidity on CERTAIN instruments in which spread may both decrease or widen
4. Reminding me that I am NOTIFIED and AGREED to the risks
5. Their price quote differ from other brokers BUT price quotes brought by biggest liquidity providers such as UBS, Nomura, Bank of America, JP Morgan Chase, Goldman Sachs, HSBC and City Bank
6. They would like to CONFIRM that they are an A-Book STP/ECN Non-Dealing Desk broker
7. Highlighted to me that my account type have market execution speed from 0.3 seconds, STP
1. My account margin dropped to a level that low because of tick chart, because FBS did minor manipulation - Please see below photo comparison of broker by broker and you will see why I say FBS did manipulation
2. When I first mentioned my account was direct/perfect hedge you never send me an agreement or anything regarding hedging on your first reply but you did send agreement for everything else. Only now you mention but no agreement?
3. I am aware my account has floating spread, but as you mention "depending on liquidity on certain instruments" is very gray and we're speaking of major pair (AUDUSD) here.
4. Every trader knows that we're in risk using any broker or when executing any trade. But the problem now lies with the broker, not me.
5. Since the list of Liquidity Providers, I assume this is the list of your LP, I will engage with them one by one and see to my issue.
6. Ms. L, this is a lie, I hereby request you to provide me with your LP Bridge for both Market Depth and Order Flow to prove you are an A-Book.
7. The reason why they highlight this is because I brought up a side issue where there are several times when my instant execution took more than 3.0 seconds to execute, so is this 0.3 STP or 3.0 price requote?
Hello giving you my 2 cents here and a bit of education.
1. Even with a perfect hedge, your trade can still be stopped out on Gapping, due to volatility, swap fees.
You just need 1 of the trades gapping to be horrid for all the trades to be closed out.
And a margin level of 90% on 660 lots stop out level of 50%? No breathing room for any volatility there. You can only close trades.
You would not see the spreads on other brokers unless you are watching it live, so you can not really compare spreads.
2. Yes there are brokers who does not use liquidity providers, such as IG, XM, Oanda, eToro, Plus500 because they are the liquidity providers, they make the pricing. Most brokers prob use JB morgan, Citibank but they mostly use Citidel, but by law they do not have to share that with you. FBS would be using multiple LPs for multiple products, but if its FX i suspect citadel they are the biggest.
3. The only argument you can argue there why is their spreads so wide, that is unusual. anything above 30 pips should be looked at and argue against the regulator of possible.
But if FBS giving you such spreads I would not be trading with them. Ask for Tick data. then report it to their Cysec regulator.