# Anyone close to an Eddy Groves? (previously known as a Margin Call)



## sam76 (7 January 2008)

All this doom and gloom has put me close to getting a phone call from Mac Bank.

Luckily I have cash kept in reserve for moments like this.

Anyone else hovering near their buffer?


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## Lucky_Country (7 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

Been there done that no big deal just put some more cash in or sell some shares.
I think most have reached a limit on the margin knowing volatile times are with us.


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## sam76 (7 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

Fair call, LJH.

My first venture in the abyss here 

Just as a side note, i hit the "yes" button at the beginning and my vote went to "Margin what?"

Anyone else get that?


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## ithatheekret (7 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

That would depend upon ones margin trading strategies , in Forex I only use 40 -45% of leveraged funds at one time , the spare sits there for the just in case I want to go heavy on a easy trade . That way I don't get margin calls as it fits to have a hefty reserve to be able to move on when needed .

Stocks , well I only margin on stocks I already own and are risers , before going in I get rid of losers , then the stocks leverage rating is the measuring stick I use and make sure I don't exceed 30% overall on those accounts . I had one margin call once , had an 1pm call when one stock was down 4.8% , I went in and bought more also having to make arrangements for the funds to go through , but by close it was only 2.3% down and it rose 3.6% the next day . I think luck was on my side then , because it was in Dec. 2001 .


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## Timmy (7 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

Ahhhhh, so that's what it means to have an edge....


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## sam76 (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

Must be a few more around at the moment.


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## ithatheekret (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

I got closer than normal , the Swissie fortunately fixed that , now I have ample . Could have done with more slack last night though .


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## Nyden (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

Gosh, you guys must have some steel down there to be on margin at the moment! It's painful enough for me to be losing my own money, little alone money I don't have! :

My answer was no, but I was tempted to say margin what


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## korrupt_1 (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

I voted yes... i have been margin called atleast 10 times in the last month or so (2 a week on average)... 

I'm always putting in just enough... (cos i'd rather have the funds in my savings than in their trust a/c) then BANG, the market goes down again and I need to pump more in... it's been a way dumping ever since... man, dont know how much more i should take... about 70% of my liquid cash is in margin calls and I'm not sure if I should commit more or just call it quit and get out... originally I only wanted to commit about 50% of my spare cash,... but everytime it goes down, Technical indicators says it's gonna bounce.. but nope... she goes down more!!

argh!!!

Leverage products can be wonderful, but it can sting if not careful!! And I've been stung very nicely indeed!!


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## grace (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

I don't have a margin loan, nor do I want one.  I am sitting on enough losses atm.  I am not good enough at investing to have one.


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## tech/a (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*



> Technical indicators says it's gonna bounce.. but nope... she goes down more!!




Don't use indicators then.
10 Margin Calls in 2 mths.
No offence but you need to stop the rot!


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## son of baglimit (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

agree grace - dont know enough to use other peoples money too.

fortunately the writing has been on the wall for 12 months, and all positions (except 1) abandoned nicely during 1st half of 07.

oh the pain if i still held them now.....all profits deteriorating.


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## tronic72 (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

I split my capital in half two weeks ago. 

1st half is used for trading CFDs and I've lost about 35% of that capital. 

2nd Half I've been using to buy shares when I see bargains. No prizes for guessing which half of my capital is 35% down. 

Although I think it's prudent to be extremely cautious at the moment, I do think the AU Market has over reacted to the whole sub-prime issue. I haven't heard a single report from a company OTHER THAN CENTRO that says they will be SEVERELY effected by what's happening in the USA. At least nothing that justifies SPs being slashed the way they have. Some examples are MQG, BNB, AFG, TOL & ABS

I also think the fears investors have regarding the US recession are over the top. I've read many articles stating that the recession may already be active and that the recession, if and when it happens will be moderate and short (approximately 6-12 months).

We are sitting close to the August Lows. Does anyone remember what sparked the August decline?


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## Bushman (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

I only use my own cash. Was thinking of a margin loan early last year but the August correction showed me the error of my ways. 

Leverage is great in a bull market, poor in uncertain times. Believe me in this; I work for Centro!! 

Still 80% in gold, natural gas and iron ore. Holding up ok at the moment as I went for companies in transition or with good exploration potential. Lack of depth and news in this market will kill you. Premiums are being whittled away. 

Stay solvent and you will trade again. Markets recover (except for the isntance of the Japanese market crash, I know). 

Good luck. How many days red - its been 8 in a row? I believe a few more investment banks reports overnight. Why oh why did they not write these loans off in the last quarter.


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## stockwhizben (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

yea another margin call for me today. got till friday to clear it up. yep margin at the moment is eroding 2 years of profits but then i think and say if i had used my own savings there is absolutely no way i would have got this far anyway so margin has been good to me. Hence my reluctance to let it go. started with zip, up 150k clear in 2 years, now down 80k in 2 months. all the blue chips doing this. I learnt a lesson, when im older no way am i going to have everything in shares - will be overweight property, some shares, some term deposits.

had an amusing chat with the nab manager today when she called. said that i was about the only 1 to answer her calls today. she said people tend to not answer their phones and try and avoid margin calls. also the nab has changed the criteria for how much equity % you need to borrow $x coz upper mgt says the investing landscape has changed. anyway thought it was funny people dont answer their phone


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## dj_420 (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

Wow, I thought most people liquidated around Oct/Nov, I sold almost everything around Oct and have only entered in for short term trades and topping up two long term stocks.

Still got around 80% cash waiting to re-enter market.


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## stockwhizben (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

awsum timing DJ. i missed this one. i beat the august downturn though. so 1 outta 2 aint bad. i kept thinking santa claus was coming december so hung around. doh


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## Struzball (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

I voted no, but if the market goes down a further 25% I might change my vote!

I'm sure this won't happen.... but who knows.


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## Kauri (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

My bookies got the heavies out looking for me...   
Giidyup
........Kauri


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## ithatheekret (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

Following you about sounds dangerous 

apart from the sun the suits would have to dodge roos and snakes


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## 2020hindsight (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*



dj_420 said:


> Still got around 80% cash waiting to re-enter market.



How I envy you dj lol
I went back in around Xmas - down about 20-25% since then   (eg BHP)

PS I've always thought that "buy on bad news , sell on good" 
was somehow around the wrong sequence lol


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## Kimosabi (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

I got out of everything in the middle of last year and bought gold


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## grace (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*



2020hindsight said:


> How I envy you dj lol
> I went back in around Xmas - down about 20-25% since then   (eg BHP)
> 
> PS I've always thought that "buy on bad news , sell on good"
> was somehow around the wrong sequence lol





I don't feel so bad now.  I missed both corrections.  Predicted the mid-year one, but was unavailable to trade at the time.  Sounds a good excuse, but that is the truth.  Was waiting for Santa too (my broker said he would come.....I said I can see another correction, he said......unlikely.....damn broker).  Don't mean to offend brokers.......noone can predict the future.


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## 2020hindsight (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*



grace said:


> I don't feel so bad now.  I missed both corrections.  Predicted the mid-year one, but was unavailable to trade at the time.  Sounds a good excuse, but that is the truth.  Was waiting for Santa too (my broker said he would come.....I said I can see another correction, he said......unlikely.....damn broker).  Don't mean to offend brokers.......noone can predict the future.



grace 
 and don't you love the way they all know that the "correction we had to have" was imminent - but tell you the day after it happens lol.

By the time they all sing with one voice it's too late . 

PS you have to laugh or you'd cry .


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## tech/a (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

Some one mention BHP?
Some technical stuff.


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## Buster (16 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

Not yet..

I'm only around the 40% mark atm so have some way to go before the 'dreaded' call.. the market would need a deadset implosion for that to happen but I have a reasonable cash reserve just in case.. 

I'm wondereing how much of this 'correction' may be due to some getting caught out and dumping portfolio's.

Perhaps I'm a bit of a mug, but I picked up a couple of stocks today.. Nobody ever accused me of being smart!!   I'm looking at building a 'solid' long term portfolio for 'dividend income' to live off in retirement.. hopefully that will occur in a couple of years, really don't want to work til I'm 65.. (another 25 years..) Retch..

Regards,

Buster


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## vida (19 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

hmm if  most people had liquidated i.e. sold off shareholdings, the market would have crashed in October - what do you mean ?  You can't mean that.



dj_420 said:


> Wow, I thought most people liquidated around Oct/Nov, I sold almost everything around Oct and have only entered in for short term trades and topping up two long term stocks.
> 
> Still got around 80% cash waiting to re-enter market.


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## numbercruncher (19 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*



> Reserve Bank research shows the number of margin calls on highly leverage investors during the September quarter (the most recent for which figures are available) had increased *fourfold*.
> 
> "This really opens up margin calls. When you see a huge sell-off in equities, people have to raise capital and they are selling whatever they can get their hands on," Ms Lee said.
> 
> ...




http://www.theaustralian.news.com.au/story/0,25197,23073892-5005200,00.html


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## Judd (21 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

A number of people will be receiving margin calls today and possibly over the next few days.  Some will, unfortunately, go broke or at a minimum their personal finances will be absolutely hammered.  However, it can also emotionally hurt very badly.  Having been the situation once, may I suggest that it could help if professional support is sought but at the very least involve your family.

As to the finances, well, over time they can be repaired but heck as long as you can keep a roof over your head, place food on the table, pay day to day bills, your in front.  So just aim for that if you can.


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## numbercruncher (21 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

yup self feeding forced selling to meet the dreaded loan requirements.

All I hope is people dont start throwing good money after bad money


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## weird (21 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

The words of Jesse Livermore -



> "When a margin call reaches you, close your account. Never meet a margin call. You are on the wrong side of a market. Why send good money after bad? Keep that good money for another day."


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## agro (22 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

yes

i think the reason the market is going down more sharply is because people need to sell up shares in order to get out of MC..

look at BHP going down,, all the smaller ones need to be sold off to stay safe


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## laurie (22 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

Just think of the CGT the feds are getting out of peoples losses 

cheers laurie


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## Gundini (22 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*



agro said:


> yes
> 
> i think the reason the market is going down more sharply is because people need to sell up shares in order to get out of MC..
> 
> look at BHP going down,, all the smaller ones need to be sold off to stay safe




Which gets back to the reason we are in such a finacial mess Globally:

Access to easy CREDIT!

What a wicked web we weave...


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## Buster (26 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

Hey ASF'ers

SMH article, mostly fluff, but thought this pertinent.. 



			
				SMH Article - Caught in the Crash said:
			
		

> On Tuesday alone online the brokerage and margin lender CommSec made more than *2100* margin calls, up from a normal day of *30* calls, relating to loans worth $40 million.




http://business.smh.com.au/caught-in-the-crash/20080125-1o7b.html

Ouch..

Buster


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## Awesomandy (26 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*



Buster said:


> Ouch..




And now stocks have gone back up too. Well, at least the good news is that those who didn't leave much of a margin/buffer in their loans have been flushed out, hopefully teaching them a lesson in this type of loans. And to those who are on the edge of a margin call, it's should be a wake up call to them, that leverage should be used very carefully, perhaps even with a touch of conservatism.


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## laurie (26 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

Well one would like to think a long term customer would get some slack from the likes of CommSec but no business is business,which is fair enough, but surely there must be a buffer - % to allow for volatility,anyhow I couldn't log in to see my margin summary nor contact them by phone they were in melt down, BUT I'm sure they would find a way to contact me   the other factor not mentioned a few companies fell off the approved LVR accepted shares for margin lending and that worries me if you have them as security

cheers laurie


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## Buster (26 January 2008)

*Re: Margin Call - Anyone teetering on the edge?*

G'Day Laurie,



laurie said:


> the other factor not mentioned a few companies fell off the approved LVR accepted shares for margin lending and that worries me if you have them as security




Now that raises some interesting questions, like 'What do they do with your holdings?' for one.. Do they liquidate them immediately? 

Certainly and old trick for new players.. I also though the reneging on the 'buffer' was a little ordinary..  I'd tip these points are worthy of being transcribed into the *'lessons learnt in a falling market' *thread..

Regards,

Buster


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## Sean K (28 February 2008)

*Re: Anyone close to an Eddy Groves?*

I thought I'd take the liberty to alter this thread slightly, and coin a new phrase to replace the dreaded 'Margin Call'.

Henceforth, a Margin Call shall be termed an Eddy Groves...

You heard it here first!


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## sam76 (28 February 2008)

*Re: Anyone close to an Eddy Groves?*

Who's Eddy Groves?

(I like my old title better, makes it easier when researching threads)


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## sam76 (28 February 2008)

*Re: Anyone close to an Eddy Groves?*

ABC dude


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## Trembling Hand (28 February 2008)

*Re: Anyone close to an Eddy Groves?*



kennas said:


> Henceforth, a Margin Call shall be termed an Eddy Groves...
> 
> You heard it here first!




:bricks1:


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## Sean K (28 February 2008)

*Re: Anyone close to an Eddy Groves?*



sam76 said:


> (I like my old title better, makes it easier when researching threads)



Ah, you might be right Sam. I'll add Margin Call back in, until the banks start issuing Eddy Groves instead of Margin Calls....


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## sam76 (28 February 2008)

*Re: Anyone close to an Eddy Groves?*



kennas said:


> Ah, you might be right Sam. I'll add Margin Call back in, until the banks start issuing Eddy Groves instead of Margin Calls....




you never know.....   lol


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## grace (28 February 2008)

Glad you spelt that out!  I was going to respond with "No, not that close.  I was standing beside him when he was calling his driver to roll up with the Ferrari (at a child care conference)."  He smiled at me.


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## ROE (28 February 2008)

No margin.. zippo ..zero I sleep very well at night even if the stock market close for a few years


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