mf global, page-11

Morn all , In 1997 I think it was when longterm capital went under ? there was a major hit on a futures broker in England .

U may want to check but your funds with a futures broker are in a bank acct which is not owned by them .
So as long as the bank is safe it's ok .

But funds are generally in a segregated acct which means if your broker falls over your funds are ok but if your fut's broker slips up and allows 1 or more traders to get wiped then the margin required to settle the trades if the broke individuals can't pay is taken from the segregated acct , hence wiping all traders .
This is what happened in the naughty 90's and I believe the rules haven't changed .

One can only hope that MF and society general and all others with big losses do not raid the segregated accts and bankrupt individual traders .
U may want to check with your brokers or cfd providers on the above scenario and remember how they always say there are many ticks and balances in place yet MF got wacked on a wheat trader from their own desk as did society general in France , same for Barings .

My fear is many aussie brokers are allowing fut's trades well above the intraday margin requirements just like what happens in U.S.A . DISSASTER WHEN SOMEONE IS CAUGHT WRONG .

cheers ge