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There are too many variations and possibilites to be putting more
restrictions on traders. What about a trader with 1 year experience that has
30 yr mentor helping him/her?
Like a father teaching a daughter strategic use of leverage? (Do you want to
stop that?)
A small account. Maybe that's not their only account? I have numerous
accounts with various tax consequences. Some are big and some aren't very
big. But they are all being managed by one experienced trader that has
strategically used leverage for many years. Account size means nothing. Not
to even mention have multiple accounts with different brokers, which I can
think of several reasons why some one might do that. (like trying out a new
broker with $5K, or partially hedging a stock portfolio with a small futures
account, ie. different brokers)
There are some very crafty traders using some very sophisticated strategies.
Just because some trader blows up one account, doesn't mean he doesn't have
more elsewhere. A trader might use Optimal F on a small account with a
larger separate account in treasuries. Yet both accounts are part of the
same strategy.
Kevin Campbell
In a message dated 2/1/00 12:35:32 PM Central Standard Time, swp@xxxxxxxxxx
writes:
> Because that trader (with three years experience) does not remember
> 1987, let alone the mid-1960s until 1975/1982)! Margins should have been
> raised long ago. The only reason why they have not been, is that there
> are too many other ways to borrow for stocks (from 401K plans, from the
> bank -- yes people are taking personal loans to buy stocks) and via home
> equity loans. So, it is not clear that raising margins will help. And,
> I believe the daytraders do not even fall under Reg-T, so there are no
> direct margin requirements even put on them! Something needs to be done.
> That is for sure.
>
> ---
> Steven W. Poser, President
> Poser Global Market Strategies Inc.
>
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