Guaranteed stop

[DeanM]

Hi,

I'd like to understand why there a minimum stop amount that varies greatly depending on currency pairs. eg: CAD/CHF Guaranteed stop minimum is over 148pts, whereas the limit can be as low as 1pt. 

Why is that? It opens up risk to much higher loses. I'd like to determine my own risk rather than be subject to a minimum.

[AndaIG]

Hi @DeanM

Thank you for the query, 

The minimum stop distance is set by our dealing desk based on the risk inherent in the pair as well as the level of risk that we are willing to take on. So the minimum distance on guaranteed stops will vary according to the pair. With larger minimum distances on those that we deem to more risky. 

All the best 

Anda

[DeanM]

Hi and thanks for your reply.

This is not encouraging trading certain currency pairs. I am wary of CHF because of this. Isn't this something that does not encourage trading these pairs? Is there a way around it?

 

[Caseynotes]

5 hours ago, DeanM said:

Hi and thanks for your reply.

This is not encouraging trading certain currency pairs. I am wary of CHF because of this. Isn't this something that does not encourage trading these pairs? Is there a way around it?

 

Gentle reminder that guaranteed stops were introduced after the SNB debacle of Jan 2015 when the Swissy plunged 2000 points in slippage and wiped out thousands of traders, and many brokers as well.

GSs are only mandatory on 'limited risk' accounts (Australia), could apply for a standard account?

[Ian_944]

5 hours ago, DeanM said:

Hi and thanks for your reply.

This is not encouraging trading certain currency pairs. I am wary of CHF because of this. Isn't this something that does not encourage trading these pairs? Is there a way around it?

 

You do realise that what you are asking is that someone else take on the risk in your position? i.e. you want to take the upside, and someone else takes the loss when price gaps below your stop.

If things were that easy, we'd all be millionaires.

 

[AndaIG]

7 hours ago, DeanM said:

Hi and thanks for your reply.

This is not encouraging trading certain currency pairs. I am wary of CHF because of this. Isn't this something that does not encourage trading these pairs? Is there a way around it?

 

Hi Dean

Unfortunately the only way around this is to apply for a standard account. In that case you can trade without guaranteed stops. If this is something you would like to consider please contact our helpdesk. 

All the best 

Anda

 

[DeanM]

On 26/10/2021 at 19:58, AndaIG said:

Hi Dean

Unfortunately the only way around this is to apply for a standard account. In that case you can trade without guaranteed stops. If this is something you would like to consider please contact our helpdesk. 

All the best 

Anda

 

Hi Anda,

I have just a standard account. 

[DeanM]

On 26/10/2021 at 17:50, Ian_944 said:

You do realise that what you are asking is that someone else take on the risk in your position? i.e. you want to take the upside, and someone else takes the loss when price gaps below your stop.

If things were that easy, we'd all be millionaires.

 

I am not sure you understood my question in this thread... I want to limit the stop loss to a manageable amount. Refer this potential trade here with CHF/JPY. The minimum stop loss puts me at risk of losing over AU$500, when I only want to risk maybe $100. 

This sort of scenario makes it an extremely risky trade for people that don't want to risk 10, 20+% of their funds in one trade. This type of trade, should it be taken, can wipe of small traders or stop them for trading these types of currency pairs at all. 

[AndaIG]

20 minutes ago, DeanM said:

Hi Anda,

I have just a standard account. 

Hi Dean, 

You are on a limited risk account, this means that all trades that you place need to have a guaranteed stop. If you were on a standard account you would have the option to use a normal stop, which has smaller minimum stop distances. You can contact our helpdesk to enquire about upgrading your account to a standard account. They will take you through a questionnaire to assess your suitability. 

All the best, 

Anda