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Broker failure advice/stories

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tjpj1919

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Hey people been around this site for a while, enjoy reading all the honest comments and feed back.

Yesterday Bell direct had a problem with their system and users werent able to place or amend orders. I was just wondering if anyone has had any past experiences with anything like this or have any advice on how to approach them. They sent out an email apologising and said-

" there were some instances where clients who had submitted an order were disadvantaged and we have been working with these clients to find a suitable outcome."

Suitable outcome? What could this possibly be?

thanks tjpj
 

A few brokerage free trades perhaps? Other than that, probably nothing more than an apology...
 

That's as nice a response as you can expect from a broker. Many will simply say refer to Section 2.12 of our PDS, which says something alone the lines of "If our system fails, that's too bad".

There are a couple of ways to reduce these risks in trading:
1. Always have the broker's phone number and your own account number at hand, and a phone of course.
2. Always have another broker account that you can hedge your positions in case of emergency.
3. Always have backup internet connection (a lesson that I've learnt yesterday)

There are probably others that people can add to...
 
yeah i new that they would have their ass covered , then i read that line and thought that it sounded odd.

thanks for the tips much appreciated.

tjpj
 
Im in complete SHOCK! Bell Direct just emailed me back and have told me that they have looked at my case and-

"Accordingly, to ensure that you are not disadvantaged, we will make a payment of $*,***.** to your Bell Direct trading account (likely to be on Friday of this week)."

Well i never.

tjpj
 

That is excellent news tipj.



My little episode with brokers was when I was with an online broker who was run or owned by Opes Prime.

When Opes Prime hit the fan my accounts were frozen for nearly two weeks and during that period everything went past my stops and kept going down.
Eventually after I got my two accounts to another broker I was just over $62000.00 worse off.

The hardest part was watching $6000 to $7000 come of your value each day (holding instalment warrants helped accelerate the process).

An ATO PAYG tax bill a couple of days later really rubbed it in

annus horribilis
 

That's a horror story, Boggo. Sorry to hear about your loss. Did you consider some form of hedging at the time? Or was there a ban on short selling just to make things difficult.

BTW, great stuff from Bell. I make have to click that banner ad and check out their service.
 
skc said:
Did you consider some form of hedging at the time? Or was there a ban on short selling just to make things difficult.
Click to expand...

All long holdings, it would have been worse had it happened in the months leading up to that, I had exited most and any holdings were mainly short term plans but I did have conditional stops set on everything, even on the warrants based on being triggered by the underlying stocks.

None of the stops were triggered.

While on one hand it was a loss it was really a large proportion of the profits from a very good year before. Its not a nice situation to be in especially when you don't know when it is going to end.

It could happen again !
 
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