Algorithmic Trading: A Practitioner’s Guide

Re:Algorithmic Trading: A Practitioner’s Guide by paulpauper on Sunday February 12, 2023 @11:59PM (#34770308)

For example if I, as an individual, used leverage to trade on the market and some black swan even happens, not only would I lose the amount I invested, I could also end up in debt and have to sell my house or other assets to cover my obligations.

This is not true. The broker would try to liquidate your positions well before that happens. Failure to put up collateral means your position will be forcibly closed. It's called Maintenance Margin. The last thing the broker is going to allow is for its clients to incur a debt and be on the hook. The hedge fund instead will send you a letter that your money is gone. Same thing.

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Re:Algorithmic Trading: A Practitioner’s Guide by Kranar on Monday February 13, 2023 @12:02AM (#34770319)

I'd be very careful to categorically state what is true or isn't true on a topic that you may not quite be an expert in.

Brokers have no ability to liquidate a position on a company that declares bankruptcy after market hours. In fact, most major events happen during times when trading is either halted or the market is closed.

As sad as it is, there are people who have committed suicide over having a negative balance including this individual who carried a -$730,000 balance:

https://www.nytimes.com/2020/07/08/technology/robinhood-risk...

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