But none of that has anything to do with high volume or low margin trading activities.
Margin trading increases the relative contribution of idiots in price-setting.
Futures trading has become one of the hottest businesses in recent years, fueled by demand from hedge funds and Wall Street banks looking to charge trading revenue by diversifying beyond lower-margin stock trading.
Many private investors had got money on credit to play the seemingly unstoppable stock market, just as some of their 1990s counterparts play today's market by "margin" trading on the internet.
Junior minors have the highest beta and the biggest gains in a gold bull market but they can ruin you on the way down if you get stupid with margin and lose trading discipline.
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The caveats: transaction costs can add up, and trading on margin, as most people do, is risky.
Still, taking into account estimates of trading volumes and margin payments, it is conceivable that an individual hedge fund, if it had no regard for counterparty risk, could have dominated trading of an individual bank's CDS on any given day.
That margin was dramatically shrunk the next trading day when investors realized their knowledge of the transaction.
Of course, there were also things like trading curbs and higher margin requirements imposed by the exchanges in order to dampen speculation in gold at its height.
They have to commit to a minimum trading volume, and a maximum margin between bid- and offer- prices.
More generally, although customized derivatives contracts between sophisticated counterparties will continue to be appropriate in many situations, on the margin it appears that a migration of derivatives trading toward more-standardized instruments and the increased use of well-managed central counterparties, either linked to or independent of exchanges, could have a systemic benefit.
Ericsson is plunging by 15% in pre-market trading after shocking investors with a major margin squeeze.
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Futures and other derivatives trading is a much higher growth and higher margin business for exchanges.
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Some say they are slashing trading commissions and loan fees and trimming collateral requirements for margin loans made to buy more stocks, bonds, commodities and currencies.
And when a company is trading at this kind of valuation, there is absolutely no margin for error.
Some of the weakness is also from traders opting to book profits, besides selling to meet margin calls elsewhere, said Frank Lesh, analyst and broker with FuturePath Trading.
Main Street investors trading for their own accounts should be especially careful about buying on margin into these lows.
Canadian Solar shares are trading sharply lower Wednesday morning on disappointing Q2 financial results and weak margin guidance for the third quarter.
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Gaining an extra 270 days to trade on a non-registered foreign bank platform can help many retail forex traders who are not otherwise ready to begin trading under the new CFTC rules, which include 50:1 margin on majors, 20:1 margin on minors, the hedging rule and no FDIC, SPIC or segregation protection.
Lately, this aggressive push into the hedge fund market has also meant a rich source of anxiety as some bad trading bets in April seem to be leading to more fund losses and more margin calls.
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