whats the purpose of an account, anyway? -
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thread: whats the purpose of an account, anyway?

  1. #11
    Ronald raygun talks about backtax certifies. They are (supposedly) good for 10 to 15% ROI a year...

  2. #12
    Junior Member gabiiis's Avatar
    2
    I think you're missing the original posters stage. He is not saying you should risk more of your money but that money you are not risking (the other 99% if you're just risking 1%) shouldn't be sitting in your brokarage account doing nothing but should be in a bank/other investement bringing interest. In the event you eliminate the 1 you're able to move more money into your trading account and exchange with it. This egy does not increase risk at all. Even though it may be impractical for some of us smaller traders to move money frequently between accounts I'm convinced proffesional traders like yourself do this all the time. (ie. Mutual funds hold money reserves in money market funds or short term bonds, not in brokerage accounts not earning attention )
    You're right, I arrived at the middle of the conversation and I think I missed what the initial purpose was... but I feel that the conversation turned at some stage to risking more than a fair amount of equity.

    However, if pulling interest from residual capital was really the first point, I would agree that in an individual account situation this unquestionably may be rewarding(though very limited). But, together with withdrawal/transfer fees, limited control of assets, etc., this isn't really a workable situation from the managed account world that I reside in.

    If you can get a broker and a high-yielding bank account with low fees for how frequently you move your money back and forth and your trading egy is conservative and does not hold much draw down, you may actually make a couple more bucks here and there.

  3. #13
    This is the ribbon of this year, in my opinion.

  4. #14
    Senior Member Tataylo's Avatar
    435
    Just wanted to donate my two pips value to the thread of the year (or possibly that was 2008, so I am too late?)

    How I see it, fresh margin lying idle in a trading account is a complete waste. I have investments which are earning 9%-10% p.a. elsewhere (and I'd like to think are invested about as securely as you can hope for, in such troubled times).

    There's also the chance that a broker may perform a Refco, and some funds not held in a segregated account are potentially at risk.

  5. #15
    Just wanted to donate my 2 pips value to the thread of the year (or maybe that was 2008, so I'm too late?)

    How I view it, unused margin lying idle in a trading account is a waste. I've investments that are earning 9%-10% p.a. elsewhere (and I'd love to think are invested about as safely as you can hope for, in these troubled times).

    There's also the possibility that a broker may do a Refco, and any funds not held in a segregated account are possibly at risk.
    Agreed. My cash is spread among different brokers but even this is not ideal. They can fold enjoy a row of dominoes. Any money kept in a account, past what we need to trade , is at risk for little benefit.
    Like MRGreen suggests, our forex risk money can be kept in a safer place with just what we actually need to prevent margin calls being placed in the forex account. Money earmarked for forex trading, but stored elsewhere, can be considered in our MM formulas.

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