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My system(VXX/SVXY) long VXX without any margin,but I got margin call.
Dear XXX:
We are sending you this message to alert you that your trading strategy called VXX/SVXY is facing a SIMULATED MARGIN CALL.
Please close your open positions immediately. You must close as many
positions as is required to bring the equity in your account to a
positive or zero balance.
If you do not close open positions, we will automatically close your
positions at market prices, in whatever sequence we deem appropriate. We
may close more positions than are necessary to bring the account to a
positive equity.
Your account equity is currently:
I’m not sure at what time you received the simulated C2 margin call, so it’s hard for me to give you exact details about the calculations behind the one you received. (Also, it looks like your strategy is no longer facing a margin call, so whatever the issue was previously has apparently been resolved.)
But let me give some general explanation to a new user about how the margin call system works in C2’s simulated Model Accounts. In the C2 Model Account, you are allowed to buy up to 2x your cash value in long stock positions. You don’t need to explicitly declare that you want to use margin; the ability to use this buying power is automatic. If you max out the amount you are allowed to buy, and then the open position begins to lose money, the negative equity of the position you hold will be counted against your available liquidation value, and you may face a simulated C2 margin call.
So in general, you probably don’t want to max out the margin use in your Model Account. Leave some room for the inevitable drawdown or open-position loss.
Any other further questions about your specific account can be sent to help@collective2.com.
Hi,
Thanks, MatthewKlein.
My system began trading yesterday, and I got the margin call yesterday. I bought VXX with cash, no margin. So there would not be any circumstance that would generate a margin call.
My concern is my position could be forced to closed out due to C2 system error.
As I said in my previous post, you automatically will use margin if you buy more shares than you have available cash. I’ll close this thread now, but if you have further questions you can send them to the help desk at help@collective2.com.
