Excel Markets just posted to its web site:
CRITICAL NOTICE 15 Jan 2015
The dramatic move on the Swiss franc fueled by the Swiss National Bank's unexpected policy reversal of capping the Swiss franc against the euro has resulted in rare volatility and illiquidity. Both our primary and backup liquidity providers became unresponsive or illiquid for hours after the event. The majority of clients in a franc position were on the losing side and sustained losses amounting to far greater than their account equity. When a client cannot cover their losses it is passed onto us.
ALL OPEN POSITIONS MUST BE CLOSED BY 5PM NEW YORK TIME OR THEY WILL BE AUTOMATICALLY CLOSED AT THAT TIME. NEW POSITIONS CANNOT BE OPENED AS OF THIS TIME.
ALL CLIENT FUNDS ARE IN SEGREGATED ACCOUNTS AND NEVER USED FOR LP MARGINS. OUR PRIMARY CONCERN HAS ALWAYS BEEN PROTECTING CLIENT FUNDS AND 100% OF POSITIVE CLIENT EQUITY OR BALANCE IS SAFE AND WITHDRAWABLE IMMEDIATELY.
Global Brokers NZ Ltd. STP's 100% of order flow and has sustained a total loss of operating capital. GBL can no longer meet regulatory minimum capitalization requirements of N$1,000,000 and will not be able to resume business. Losses incurred on trades that could not be exited due to illiquidity were losses incurred directly with the liquidity provider and we do not have the ability to reimburse those. Please note the interbank market for francs was illiquid for hours after the event and no traders with an open franc position were able to close it for a significant period of time, at any broker.
News of the impact of this event on companies and traders is just beginning to come to light. As Directors and Shareholders we would like to offer our sincerest apologies for this devastating turn of events, and to thank you for being such a supportive group.
We ask that you place withdrawal requests for your account balance at your earliest convenience and allow for minor delays as our team begins to experience higher than usual service volumes.
Note: We are currently experiencing hundreds of withdrawal requests. A small percentage of clients have reported errors during the automated withdrawal request process. If you experience a system error please do not panic. Although we are not offer trading services our staff is fully operational and we will not disappear on you. If an error occurs please email us at support@excelmarkets.com describing the nature of the issue. We thank you for your patience and for the kind words many of you have already expressed.
- David Johnson, Director
I warned about these kinds of developments this morning in the EPJ Daily Alert:
The Swiss move is likely to have major ramifications in financial markets for sometime to come. There are probably some hedge funds who were short the Swiss franc, who will not survive the losses. This could result in the liquidation of other positions to meet margin calls on short franc positions. Watch for unusual trading patterns. Unusual liquidation trading patters will be very short-term in nature, but provide great opportunities.
From Excel's web page:
Excel Markets is brought to you by the same finance and tech wizards who founded popular fx operations like www.forexrazor.com, a free fx portal with sophisticated features and tools; and www.cashbackforex.com, a service known for superb customer service and reliability.
To effectively serve clients in all timezones we maintain offices in several locations throughout the world. Global Brokers NZ Ltd. is located in Auckland while our main client service office is located in Cork, Ireland. We have smaller satellite offices in several other parts of the world as well.
All accounts introduced by Excel Markets Ltd. are held and maintained by Global Brokers NZ Ltd.
Excel/Global will not be the only firm wiped out by the Swiss central bank move (SEE: Swiss Central Bank Pulls Plug on Euro Support). The next couple of days are going to be very interesting. There is going to be chaos, confusion and, yes opportunity.
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