Segregated Account (separate account) is a term that refers to the separation of a number of customer funds from the operational fund forex brokerage firms to ensure security in transactions forex trading. This is done so that the payment of commissions and other fees related to trading done by traders as customers smoothly, and the funds are not misused by the broker.
What was Segregated Account In Forex Broker?
Main Function Segregated Account
The main function of Segregated Account is to accommodate funds for all the clients of a brokerage firm collectively being misused for improper purposes. Funds will be utilized in the Segregated Account broker to settle certain payments from customer transactions only, rather than for the benefit of the brokerage firm.
One of the reasons why it is important is because of the separation of Segregated Account can ensure the security of client funds. With the Segregated Account, client funds are more easily identified when the brokerage firm lost its right to control, manage, or otherwise transfer wealth due to bankruptcy.
What Advantage Segregated Account?
Segregated Account can help maintain the integrity of the broker in the forex market. Each market participants will assess the integrity of the broker and consider this very important because now a lot of brokers scam and fraudsters are lurking fund trader. Segregated Account in the presence of a forex broker can make the management of client accounts more easily and precisely.
Forex broker can also set their books more effectively by utilizing the Segregated Account. Segregated Account is very significant role in the development of trading for their security, protection and legal certainty when trading forex trader can boost confidence.
Misuse of Funds In the Segregated Account
In Law Number 32 Year 1997 on the Implementation of Article 51 of the written Futures Trading, margin, including additional funds from customers' transactions must be kept in a separate account from a brokerage account at a bank approved by the Commodity Futures Trading Regulatory Agency (Bappebti). If a broker is regulated Bappebti offenses for misusing the functions Segregated Account, the call for imprisonment for five years. In addition, the brokerage firm must pay a fine of 1.5 billion rupiah. A similar rule was imposed by the regulator forex from other countries.
What was Segregated Account In Forex Broker?
Good forex broker or trader can benefit from the Segregated Account. As a client, it is important to check if the current forex broker you trust completely to provide facilities Segregated Account or not. If you use a regulated forex broker, it is clear that placing funds trading broker its clients on a Segregated Account. This condition can occur because the regulator broker usually require clients' funds are kept separately from wealth fund brokerage firm itself. However, if the forex broker is not regulated, it can not be certain of its Segregated Account.
Misconceptions About Segregated Account
The separation of client funds account with a brokerage account operational funding is a positive thing. Previously, some brokers enter their clients to deposit funds to the account of the company's operations and they use the funds for various purposes. Not infrequently some unwanted adverse events occur frequently. Now, things are unwanted can be avoided with the rules of Segregated Account.
However, there are still many people misunderstand about the Segregated Account, such as the following:
Trader Has Bank Accounts Alone In Brokers
Segregated Account does not mean the client brokers have their own bank accounts at the broker. Fund traders will be merged collectively with other client funds. So, if the client's trading account balance is negative, then this client account deficit will be closed broker of the cumulative funding, although usually the broker itself will also be closing its shortcomings when it provides negative balance protection (Negative Balance Protection).
Brokers Can not Use Funds To Margin
Segregated funds in the account can still be used for margin broker. Brokers usually require a certain amount of funds for margin trading positions as brokers and other clients.
Unless you receive specific direction from the broker, do not expect Segregated Account will secure the funds you completely. In fact, the broker can still use as margin, both for its own trading position and the position of other clients, even if you are already using the Segregated Account.
Fully fund Safely When Broker Bankruptcy
The next important fact to note is the Segregated Account can not guarantee the security of trading funds if the broker bankrupt. If a bankrupt broker