Kind.

It is important to profit from your actions, otherwise, if the position is unprofitable, it is better to lose a little, quickly and immediately, than to lose a lot and for a long time - time-tested. This will probably be the fourth edition of the systematization of my own thoughts and observations over the past five years, and as a result of my own rules.

This post will be more related to intradays and speculators who build their trading on the use of leverage on the stock market of the Moscow Exchange. When you receive a big loss and do not close it in time, it becomes difficult to part with it, cherishing the hopes of making a profit, which in turn creates selective thinking in the future - in the direction of your own position. What awaits under such a scenario?

Anyone who has not exited a losing position for any reason - averaging, stupidity, tilt - is obliged to fight at his own expense. You need to know exactly the MAC, because if the MAC is less than 0, the broker will forcibly close the margin positions, restoring the MAC to 1.0, while the loss will be about 60% of the account.

All strategies for holding a marginal loss-making position, except for fixing losses immediately (stop) or going almost to breakeven when testing the price of a broken support or resistance (this is more risky, since the price often squeezes without a return and starts trading in a reduced range for a long time) if not executed own conditions for a profitable entry, will be extremely risky and have an extremely low probability of bringing the position into profit. It is very difficult to predict low or high prices with a turn in time, and this time, together with the broker's commission, will destroy the depot every day. There are always and will be opportunities to earn, which are available only to the depot and the mind free from losses.

You can gain a large unprofitable margin position by trading against the trend, catching a reversal, that is, without confirming the reversal on the price chart. Indeed, in the second case, the settled price level and movement from it are traded, and in most cases the stop is at the entry point, which is practically a breakeven. But by catching knives, or trading against the price movement, they drive themselves into big losses, and the stop loss already incurs a significant % loss. It is more expedient to trade against the price movement in a sideways trend, otherwise the result of this movement will be in the future and one can only guess where the stop will be. When trading on the price movement, you have to wait, but you are already trading the present - the result of previous trades.

Everyone has a different speculation strategy. Someone trades when the price rebounds from someone's level where the trade was going on, someone catches a reversal, trading in opposition to the price movement. Both strategies have a place to be, and both make a profit, limiting losses is important. Losses in both cases of speculation are a natural part of trading. And this must be taken for granted. But the ratio of profitable and unprofitable trades and the size of the stop profit allows the account to either grow or decrease.

UDS - Funds Adequacy Level
= (Portfolio Value - Min Margin) / (Initial Margin - Min Margin).
On an account with no open positions, MAC = 9.99.
UDS< 1 – Ситуация движется в сторону принудительного закрытия позиций Клиента;
UDS< 0 –После наступления этого события Брокер обязан произвести принудительное закрытие позиций Клиента.

If your MAC account is already 0.2, you should start discounting lots and be ready for even bigger discounts for a positive MAC. If the account is not large and there are funds for topping up, this should be used, so you can reduce your shoulders, restore the UDS, thereby reducing the daily commission. But it is not recommended to trade on the released shoulders, as there is a lot of psychological pressure. Must wait. And it will be a struggle for the survival of your own account, which is being experimented on (it’s hard to call it another way), but if this is a struggle for an account from borrowed funds or funds under management, then you need to stop and radically revise your trading. I also drove my account into a drawdown for the experiment, and when the MAC was below 0.2, I placed stops, as there may be powerful straits or the lack of a monitor or a technical restriction on access to trading (computer and program failure, Internet, electricity). But the stops need to be adjusted every day, since the account decreases due to losses (daily commission from the shoulders), the MAC decreases and the stops need to be adjusted and set before canceling.

All this is an extremely neglected state of a losing position. In fact, for profitable trading, it is not allowed to allow a peak of the depot, with only the hope of a price return. The entrance is always performed according to its own developed rules, as well as the exit. You have to be ready for any scenario of the development of events, hang up - you should not tilt. And if the price goes against the position, you must admit the mistake immediately and get rid of the loss when it is still small. And if the MAC of the accumulated leverage is slightly more than 1.0, then the loss fix will be several hundredths of the MAC lower (there was a MAC of 1.05 - fixing at a MAC of 1.02), and this is a few % of the loss on the account. If you are always at the monitor, then you can close it with your hands, but this is extremely dangerous (a technical failure of the equipment is a lack of control), and even if you move away, stop and take profit until canceled. Dozens of times I watched how the price, breaking through support or resistance, rapidly moved against the position and after averaging (improving the average), the price, having made a correction to the movement, approached the average (BU), and it was fixing there that made it possible to avoid large losses when the price movement resumed against the position. This loss exit strategy is much riskier than a stop loss, but allows you to exit with smaller losses, of course with a 50/50 chance, instead of a fixed stop loss, which is an increased risk. Averaging is a fortune-telling and protracted action that puts at risk even more large sums with additional losses from price reduction, turnover commission and margin commission. At the same time, you need to remember that when averaging, the price is already much lower than the average position price, and this is already a big loss, much more than the loss of a regular stop. You need to cover losses immediately. And work on the correctness of entries and exits, analyzing transactions - increasing experience and means in management.

Losses must be closed immediately, and when averaging, very often the price rolls back and reaches the average price (tempting and giving hope for a profit), giving the smart ones (who immediately admitted their mistake) the opportunity to go to 0 or with a minimum loss, but if this is not done, then the result will be obvious - this is a drain of part of the account ... From this we can conclude that it is less risky to sit out price drawdowns for investors who are in long positions and only at their own expense. Of course, this is also a big question and whether many of them survive. Investors are not threatened with a margin call, but they are threatened with multiple depreciation of the paper, where the time factor and the issuer's policy play. Holding unprofitable positions with leverage in short or long positions is a very big risk, and in most cases these losses are directed to Margin Calls.

Margin Call is a circumstance under which a broker closes a losing trade. This happens when the level of sufficiency of the account's funds approaches 0, or when the price moves in the wrong direction, when the account balance, which is necessary to maintain the margin of all active transactions, approaches zero.

And for those who read to the end. I will reveal one secret. There are a lot of variables that affect the price movement, knowing all of them, linking them into logical chains and quickly making the right decisions is a lot of work for many years of trading and introspection, despite the fact that the market is constantly changing. Indicators create only the illusion of control over the price movement. It is much easier with long money to collect a portfolio and pull for years or months with fast movements. Many stocks move in different directions, compensating for the loss on the account as a whole - they took the paper by 10% of the account, and the price sank by -5-10%, so what? the loss is only -0.5-1% on the position. And with 3-5 leverage, the loss is already -15-50%! And where is it easier to reset the account? That's right - it's trading and guessing with a maximum of shoulders, without limiting losses, and without fixing profits. So, you need constant control over losses and profit!

P.S. Hello intradays! Snow, your work has always impressed me, continue, because for some reason it is necessary.

On March 27, 2014, the BCS Company switches to compliance with the requirements of the Order of the Federal Financial Markets Service of August 8, 2013 N 13-71/pz-n ON UNIFIED REQUIREMENTS FOR THE RULES OF CARRYING OUT BROKERAGE ACTIVITIES WHEN CONCLUDING INDIVIDUAL TRANSACTIONS AT THE EXPENSE OF CLIENTS (hereinafter referred to as the Order).

Below are the main innovations that appear as a result of the implementation of the requirements of this Order.

The changes that will take place on March 27, 2014 can be summarized in the following main points:

Moving from the same leverage for all leveraged securities to determining the purchasing power separately for each security, based on risk rates.

Changing the used risk parameters.

Risk Rates

The risk rates that BCS may apply to its clients are calculated by clearing organizations and published on the Internet. If more than one risk rate is calculated for a security, BCS Company, in accordance with the Regulations, may apply any of them.

The list of securities with which BCS provides the opportunity to work with incomplete coverage, and the applicable risk rates, is disclosed on the company's website.

Please note that the publication of the list of securities and rates in accordance with the new rules will begin on March 26, 2014.

The order identifies the following categories of risk that can be assigned to clients by a broker:

1) standard level of risk;
2) increased level of risk;
3) a special level of risk.

Individual may be classified as standard or elevated risk. To increased level of risk a client - an individual can be attributed in the following cases:

The value of the client's portfolio exceeds 3,000,000 rubles.

The value of the client's portfolio exceeds 600,000 rubles, while an individual has been a client of the broker for the last 180 days, of which at least five days at the expense of this person the broker concluded transactions with securities or derivative financial instruments.

Legal entities, in accordance with the Order, are classified by BCS as a special level of risk.

If the Client cannot be attributed to a special or increased level of risk, he is assigned standard risk level.

Risk parameters used

The main risk parameters used are client portfolio value, initial and minimum margin. The calculation of these indicators depends on the risk rate applied by the Company for this security and the level of risk assigned to the client.

D = risk rate calculated clearing organization and applied by BCS Company.

Meaning initial margin calculated on the basis of the initial risk rate, determined by formulas depending on the level of risk of the client.

Meaning minimum margin is calculated based on the respective initial risk rate, which is the same for all risk categories of clients.

. Coefficient k for special risk is set by BCS Company.

For all the specified risk categories, if the Company's client refuses to work with incomplete coverage, the initial and minimum risk rates are set at 100%, the opportunity to open short positions is not provided.

An important difference introduced by the new Order is calculation of indicators for the planned item, which takes into account transactions with all maturities. The mechanism of operation of the new risk parameters "Initial Margin" and "Minimum Margin" consists in their calculation and constant comparison with the "Portfolio Value" indicator. Further, depending on the values ​​taken by these indicators, the amount of risk in the portfolio is assessed and the need for certain actions to maintain the required levels of indicators is determined.

The values ​​of the indicators "Initial Margin", "Minimum Margin" and "Portfolio Value" are calculated in ruble terms.

An example of calculating risk rates depending on the rate disclosed by the clearing organization and applied by the BCS Company

How the requirements of the order will look in the trading QUIK system

First of all, you need to update the QUIK version to the latest version (currently version 6.12.0.31 is recommended, it is the one posted on the site for download). To update the QUIK version, you need to run QUIK (for Windows 7 and 8 - run QUIK as an administrator, for which you need to right-click on the QUIK shortcut and select "Run as administrator"), go to Communication - Update the program version, "Yes" , click Accept Files. When QUIK needs to restart the program, agree.

To correctly display risk parameters, you first need to set up the Client Portfolio table. With the transition to the requirements of the new Order, a number of old indicators in the client's portfolio have lost their meaning (margin level, current leverage, available limit), and they should be removed. Others (shoulder) have changed their meaning and are used differently.

You need to add the following parameters:

portfolio value,
. Initial margin,
. Min. Margin,
. Speed ​​Margin,
. Status,
. Requirement,
. UDS.

To do this, right-click on the "Client Portfolio" table, select "Edit Table" and add the required parameters listed above one by one by highlighting the parameter and clicking the "Add" button. After adding the parameters, click "Yes".

Let's look at how the new indicators and their values ​​look in the "Client Portfolio" table.

On the this example a client with a standard level of risk is listed. From the "Client Portfolio" table, by double-clicking on it, you can open the "Buy / Sell" table, in which, by setting filters, you can see the established risk rates depending on the risk level of the client and the security. Risk rates can be displayed both exclusively for available securities, and for all securities available for work with incomplete coverage.

Meaning of fields in tables

Let's add one more client to the client portfolio with leverage = 2, which corresponds to the CRMS.

In this example, two clients are shown with the same assets, but different levels of risk, set by "Leverage". The risk rates are reflected in the Buy/Sell table, their value can be checked using the calculation table. The example shows how the risk rate affects the value of the "Initial Margin" and "Minimum Margin" indicators. CRMS requires less collateral to open a position, which allows such a client to open a larger uncovered position than is possible for CRMS.

The following example also shows the difference in customer provisioning requirements with different levels risk (CRMS and CRMS), as well as the behavior of the indicators "Status", "Requirement" and "UAS" with a different ratio between the value of the portfolio and the values ​​of the initial and minimum margin.

Examples of purchasing power calculation:

1. You have only DS on your brokerage account (300,000 rubles), depending on the risk category of CRMS/CRMS, you need to find the Initial Margin rate for the security you are interested in and the type of long/short operation. For example, for Gazprom shares they are equal to CRSD - 0.12/0.12 and for CRMS - 0.2256/0.2544. Since at the time of the transaction, the value of the Portfolio cannot be less than the Initial Margin, then maximum size long\short in rubles is calculated as follows:

CRSD: 300,000/0.12=2,500,000 rubles to buy Gazprom with leverage;
300,000/0.12=2,500,000 rubles for a short position in Gazprom.

KSUP: 300,000/0.2256=1329787 rubles to buy Gazprom with leverage;
300,000/0.2544=1,179,245 rubles for a short position in Gazprom.

2. If there are only securities on the brokerage account, then discounting their value according to the Initial Margin rates must be added to the calculation from point one. For example, you are a CPSD. On your brokerage account DS=0 and there are 1000 shares of Gazprom with a current price of 125 rubles. The Initial margin rate is 0.12, therefore, the maximum available for you to buy Gazprom shares with leverage is:
/0.12=916667 rubles.

The remaining options for calculating purchasing power will be a combination of examples 1 and 2.

Example of calculating forced close levels:

If the value of the Portfolio becomes less than the Minimum Margin, the broker performs forced closing to the level when the value of the Portfolio exceeds the level of the Initial Margin. For example, there were 300,000 rubles in the brokerage account, a transaction was made to purchase 4,000 shares of Gazprom at 125 rubles, and the debt is 200,000 rubles. In this case, the Margincall level is calculated as follows:

CRSD:
X is the price below which a forced close occurs
0.0619*4000*X is the minimum margin

Margincall happens if 0.0619*4000*X< 4000*Х - 200 000 или Х= 53,30 рублей

CRMS:
0.12*4000*X is the minimum margin
4000*X - 200,000 is the value of the Portfolio
Margincall happens if 0.12*4000*X< 4000*Х - 200 000 или Х= 56.82 рублей

ATTENTION: On March 20, 2014, an Internet conference was held on the BCS Express website, dedicated to the upcoming changes after March 27. We strongly recommend that you take 5-10 minutes of your time to familiarize yourself with .

You can also attend the free webinar "New Requirements for Margin Trading: Features and Opportunities" on Wednesday, March 26th.

Best regards, BCS Broker

"Margin lending" - for the purposes of this material, a term that means not the provision by the Broker to the Client of funds or securities as a loan, but the provision by the Broker to its Client (subject to the necessary conditions) of the possibility of submitting and executing the Client's instructions for making transactions and / or under the Brokerage Agreement transactions entailing the emergence of an uncovered or temporarily uncovered position in securities and cash and the execution by the Broker of transfer transactions of positions in accordance with the Brokerage Agreement and the terms of the Agreement on transactions with incomplete coverage.

As part of the Margin Lending service, we offer you:

• take advantage of "shoulder" - open a position several times greater than the size of your own assets;
• use a wide range of securities for margin trading;
• control the current limits (restrictions) for opening short positions on securities in the QUIK trading system on-line.

Changes since March 27, 2014:

• 1. The amount of leverage is set not for the Client's account as a whole, but for individual securities.
• 2. Now, by default, all Clients are connected to the Margin Lending service. If you do not want to use the service, it can be disabled upon written request.
• 3. The circle of Clients, which the Broker can refer to the category of Clients with an increased level of risk, has expanded.
• 4. A category of Clients with a special level of risk has appeared.
• 5. The lists of securities with which transactions with incomplete coverage are allowed have been expanded.
• 6. A short position ("short") on a security is allowed if its price has decreased by no more than 5% from the closing price of the previous day (before 03/27/14 it was 3%).
• 7. The planned position (portfolio value) is also calculated for transactions with a maturity of more than 2 days. Until March 27, 2014, the planned position was calculated only for deals with a term not exceeding Т+2.

How you can use margin lending

An example of buying securities with a leverage of 1:5:

You have 1000 rubles. Using "leverage" 1:5, you can buy shares in the amount of 6,000 rubles: you pay for shares in the amount of 1,000 rubles with your own funds, and the rest - using "leverage": you are provided with 5,000 rubles of additional funds. To use "leverage", you should simply submit an order to purchase securities for an amount that exceeds the amount of funds in your account. As a result of the transaction, you will have a long position in securities (“long”).

Long position (Long)

If you bought 1 share at a price of 100 rubles using only your own funds, and after some time sold this share at a price of 110 rubles, then your income will be 10 rubles.

If you use the “Margin Lending” service, using a “leverage” of 1:5, then you can buy 6 shares for 100 rubles of your own funds and 500 rubles of additional funds. After some time, by selling these shares at a price of 110 rubles, you will receive income 60 rubles.

Buying with leverage allows you not only to increase speculative income, but also to buy securities at the right time. For example, the share price has dropped sharply, and has become attractive for investment. But at the moment you have less money in your account than you would like to buy shares. With the help of margin lending, you buy the security you need in the right amount, and then add funds to your account. To do this, you have a whole day, because the check of the sufficiency of funds for the execution of settlements on the transaction is carried out on the next day after the conclusion of the transaction.

As a result, you do not need to keep the full amount of money on your account in anticipation of an interesting price to buy a security. It is enough to provide only a part of the funds, and the rest of the money is provided to you as part of the Margin Lending service.

An example of selling short (“short”) with a leverage of 1:5:

You have 100 rubles. You have a "leverage" of 1:5. This means that for transactions you are provided with additional assets in the amount of 500 rubles.

Short position (Short)

You were sold short (borrowed) 1 share at a price of 100 rubles. After some time, you bought back 1 share at a price of 90 rubles and closed the "short", i.e. returned the borrowed share. Income from the use of borrowed assets (1 share) with a leverage of 1:1 (100 rubles of own funds accounted for 1 borrowed share at a price of 100 rubles) amounted to 10 rubles.

The risk of using a "short" with a "shoulder" of 1:1 on short time intervals is comparable to the risk of buying shares with your own funds.

If you used the 1:5 leverage set for you, i.e. you borrowed and sold 5 shares at 100 rubles each, and after a while you bought back 5 shares at a price of 90 rubles, then your income using margin lending would be 50 rubles.

Thus, "short" allows you to make money in a falling market when securities quotes are declining.

What leverage is available for margin trading

"Leverage" shows how the additional assets that are available under margin lending correlate with the Client's own assets. The amount of "shoulder" for each security is different, and it depends on the risk rate for this security. Risk rates are calculated by clearing organizations.

Rounded risk rates are shown in the listings of securities (see ). Information about the exact size of bets is contained in the QUIK trading system (version 6.11.2.5 or higher).

In effect, the risk rate is the discount at which a security is valued in margin lending. When buying a leveraged security, there is always a risk of a price decrease; when buying a short, there is always a risk of a price increase. The security risk rate takes into account the risk of unfavorable price changes and allows assessing the amount of risk that the Client can take on a particular security.

Risk rates reflect:

• overall market volatility. The more volatile the market, the higher the risk of changes in the value of the security, and hence the higher the risk rate;
• liquidity (volatility) of a particular security. It is known that large buy/sell orders have less effect on the prices of highly liquid securities than on the prices of low liquid ones. Therefore, the less liquid the security, the more volatile its price, and hence the higher the risk rate for such security.

Using the initial risk rate for a security, you can calculate the maximum leverage available to the Client in transactions with this security:

For example, the initial risk rate for a security is 50%. This means that the Client can make transactions with this security with a leverage of 1 to 1.

How risks are controlled when using "leverage"

If you use margin lending, then you need to control the following:

• how the value of the portfolio and the size of the initial margin are related;
• how the value of the portfolio and the size of the minimum margin are related.

Portfolio value- is the value of liquid assets in the portfolio on the Client's account minus portfolio liabilities. Liquid assets include cash and liquid securities that are on the Client's account, as well as that may be credited to the Client's account as a result of the execution of concluded transactions. That is, the value of the portfolio is the value of the Client's own liquid assets on the account. Illiquid securities are not included in the calculation of the portfolio value.

Initial Margin allows you to assess the risk of opening new positions. Since the Client can only risk his own assets, the initial margin should not exceed the value of the portfolio. If the initial margin exceeds the value of the Client's portfolio, then:

• firstly, the Client cannot open new positions aimed at increasing the margin;
• secondly, the broker sends a notification to the Client that the value of the portfolio has become less than the initial margin.

If the Portfolio Value is less than the Initial Margin, the Client cannot open new positions.

Minimum Margin allows you to assess the risk of holding open positions.

The minimum margin must be less than the value of the portfolio. If the minimum margin exceeds the value of the portfolio, then the Broker is obliged to forcibly reduce a part of the Client's positions to an amount at which the value of the portfolio will not be less than the initial margin for the portfolio.

If the Portfolio Value drops below the minimum margin, the Broker will be forced to forcibly reduce the Client's position.

To avoid the risk of forced reduction of positions, the Client can do the following:

• either close some of the positions on their own and thereby reduce the size of the initial margin;
• or add liquid assets to your account: cash or liquid securities and thereby increase the value of the portfolio.

Categories of Clients

• total assets of 600 thousand rubles or more;
• has been a client of the Broker (or a client of another Broker) for the last 180 days;
• during the last 180 days, made transactions with securities or derivative financial instruments for at least 5 days

For each category of Clients, separate levels of risk rates are set:

* From March 27, 2014, all Clients of IC InstaVector LLC are enabled by default with the Margin Lending service. If the Client disables the "Margin Lending" service, then the risk rates for all instruments are set at 100% for him - "leverage" becomes unavailable.

Margin lending rates

If the Client does not carry over the margin position (“short” or “long”) to the next day, but uses leverage only for intraday trading, i.e. As of 18:50 Moscow time, there are no temporarily uncovered positions in the Client's portfolio in terms of settlement terms for transactions on the current trading day and the next trading day, the Margin Lending service is provided FREE OF CHARGE.

When transferring a position to the next day, interest is charged according to the tariff plan.