I have dual US/ European citizenship. I would like to change to a broker that offers negative balance protection in case of a black swan event. The major European brokers that I have spoken to do not allow me to open an account because I reside in the US. Are there regulated brokers that offer that kind of protection to US residents? Or failing that, offering other types of potential protection such as guaranteed stop loss to US residents? Thanks for your input.
Sorry, but out of the literally infinite aspects of trading, your hill to die on is tied up in black swan events, which by nature literally almost never happen?
What is your motivation for this requirement?
The last BSE I encountered, was in Jan 2019, which lasted for about 3 minutes. Unfortunately I was on the wrong side of the trade and my S/L was triggered ‘late’. The irony was had I not had a S/L I would have recovered when the trade reversed three minutes later. Lost over £1k.
And negative balance protection only protects you from more loss than your account balance - which could still be a substantial loss.
Can’t protect against things like that as the previous post says its for more than your balance. Just have to take it on the chin if it happens
Its a reasonable protection to enquire about from a broker. Its mandatory here in the UK and I would not now even consider going off-shore to find a broker with other advantages but who didn’t provide it. Even if negative balance protection is not included in the package you find, setting a low leverage rate will also offer some protection against the impact of a Black Swan.
Other things are more, or even completely, under my control.
Would like to trade putting only (as bad as that is) my account balance – not my house - on the line when big events completely outside of my control happen.
Exactly. I’m really only trying to find a trader that will/ can offer the kind of protection to their US costumers that many of them already offer to their UK (and other) costumers. You’re right about the low leverage rate though – at least potential loses are smaller…
It is difficult to find a broker which is genuine and which accepts US citizens. Due to the new regulations most of the brokers have stopped accepting US clients. I have an account with three brokers which accepts US citizens- Oanda, Turnkey forex and IG. I knwo for sure that Turnkey forex provides negative balance protection because my balance went to -$40 so I contacted their support and they reset that to 0 but I am not sure whether other brokers provide the same since I have not faced this thing with them but I will definitely keep you posted on this.