Account Knocked back

[nev25]

I tried to open a CFD Trading Account
And they wouldnt open it because I told them I didnt have any savings

What business is it them how much money I have or dont have

 

[wonderrman]

so how were you planning on trading with no money? i don't know if you realise this, but you NEED money to BUY cfds.

wonder.

 

[wayneL]

I tried to open a CFD Trading Account
And they wouldnt open it because I told them I didnt have any savings

What business is it them how much money I have or dont have

Because it is a leveraged account. With ordinary shares, you basically can't go past zero. With leveraged instruments such as futures and CFDs you can go way past zero. Example AMP a few years ago.

They need to be able to come back at you for losses and they prefer cash, as they have no use for your first born male child and/or your left testicle.

It's due diligence.

 

[trainspotter]

LOL @ WayneL for the teste and first born son jibe. Too late for me ... wife has got both already !! She is not a signatory on the cheque account though !!!

 

[nev25]

so how were you planning on trading with no money? i don't know if you realise this, but you NEED money to BUY cfds.

wonder.

Missing the point

Why do I need to prove I have savings

A plumbers doesn't ask to see your bank statements before he fixes your plumbing

 

[wayneL]

Missing the point

Why do I need to prove I have savings

A plumbers doesn't ask to see your bank statements before he fixes your plumbing

 

[springhill]

Because it is a leveraged account. With ordinary shares, you basically can't go past zero. With leveraged instruments such as futures and CFDs you can go way past zero. Example AMP a few years ago.

They need to be able to come back at you for losses and they prefer cash, as they have no use for your first born male child and/or your left testicle.

It's due diligence.

Agreed, with the number of guys willing to 'give their left nut to root that' its a flooded market, so virtually worthless

 

[springhill]

Because it is a leveraged account. With ordinary shares, you basically can't go past zero. With leveraged instruments such as futures and CFDs you can go way past zero. Example AMP a few years ago.

They need to be able to come back at you for losses and they prefer cash, as they have no use for your first born male child and/or your left testicle.

It's due diligence.

Missing the point

Why do I need to prove I have savings

A plumbers doesn't ask to see your bank statements before he fixes your plumbing

Clear as mud?

 

[Timmy]

Missing the point

Why do I need to prove I have savings

A plumbers doesn't ask to see your bank statements before he fixes your plumbing

When you open a CFD account you are basically lent money by the CFD firm to trade with, it is a similar idea to a line of credit. Now, you don't necessarily have to trade with this money they will lend you, but you can if you want to. If you trade with this money they lend you and you lose it, they need to be repaid the loan regardless, hence the firm wants to see some security (savings are one form of security) before lending you this money.

 

[tech/a]

Missing the point

Why do I need to prove I have savings

A plumbers doesn't ask to see your bank statements before he fixes your plumbing

But a prudent plumber who was asked to do a job big enough would ask for credit references.
If you still went ahead--couldnt pay--chances are he'd have a caveat on your home eventually.
Are you in the habit of over stretching your non existant capital base?

 

[knocker]

**** happins hey bro. I'll go guarantor for you if you like.

regards

KNOCKER

 

[Sir Burr]

What business is it them how much money I have or dont have

I feel your pain.
Yesterday I applied online to have some software coding quoted by a programmer and his reply email asked for my contact details.

Why should I give him my private information

 

[nev25]

Ok

but you NEED money to BUY cfds.


wonder.

But

When you open a CFD account you are basically lent money by the CFD firm to trade with,.

 

[beamstas]

LOL LOL LOL LOL LOL LOL LOL LOL LOL

 

[>Apocalypto<]

Missing the point

Why do I need to prove I have savings

A plumbers doesn't ask to see your bank statements before he fixes your plumbing

If you can't understand why they ask for this. I would say don't trade CFDs or trade any leveraged products.

The key concept here is risk management.......

some say that's a very important part of trading.....

 

[Aussiest]

Finally, someone who knows less than me.

LOL, LOL.

Are you serious nev25?

To cut a long story short, they will subsidize some of the value of the share for you, but you have to have the initial deposit. If the price of the share falls below that at which you bought it, the provider will either ask for more money from you or close down your position so that they can keep your deposit. Because you committed to buying those shares at $XX, the provider will ALWAYS get their deposit.

 

[prawn_86]

Ok
But

So whats going to happen when you lose their money? Of course they will want it back, hence why they need to know that you can repay it if/when you do lose it.

 

[trainspotter]

IF And it's a big IF Nev25 you open this account (with no cash in the bank) and you trade and make a LOSS (heaven forbid) How do you intend to pay it back?

Where does this leave the credit provider? Under the UCCC (Uniform Credit Control Contract) you have used these monies for business purposes and I think you would find they are entitled to compensation ie THEIR MONEY BACK !!

On the other hand under "Due diligence" (which has been stated previously) the credit provider did not ask you if you had capital to repay then they would be left with no recompense course of action.

Why did you not tell a LIE and advise them you had 10k in the kitty? Ohhhhh ... that's right ... you are honest. So logically as an honest person you would understand that NO ONE is going to lend credit with no capacity to repay. Go and buy a lotto ticket.

 

[wonderrman]

This man is very funny. obviously you do not have the mental capacity to be able to trade. if you can't get your head around the fact that you NEED sufficient capital (capital = savings = money) to be able to open an account.

go back in your cave and leave trading for another day i would think.

w.

 

[awg]

I tried to open a CFD Trading Account
And they wouldnt open it because I told them I didnt have any savings

What business is it them how much money I have or dont have

The previous answers made the point, but for a complete newbie, maybe not clear enough.

You HAVE to have YOUR cash in the account to meet the margin on any open trade.

If the amount of your cash falls below the margin, the provider will close out your positions, so they dont lose money.

BUT, sometimes, possibly, they cant close them quick enough, for your margin to cover the losses. ( under various scenarios..ie huge market crash)

This means you would owe them money, additional to what you put into the account.

You would be sent a legally enforceable bill

That is why they prefer to know you can afford to pay.

If you carefully read the PDS for the providers, this is explained.

An example..GFT expects you to stump up $3500 to open an account, but you can withdraw most of that, and trade smaller amounts.

Be aware that most new CFD users "blow" their account, which is why they are always chasing new customers!