BC, Currency trading usually requires a margin account. When you put down $1,000 you are betting on the currency movement of $100,000.
If a currency moves by 10 basis points (i.e. one tenth of one percent) a thousand dollar bet will result in a thousand dollar gain/loss. If the currency moves by one percent in your direction/favour, a thousand dollar bet results in a ten thousand dollar gain. Well, on Friday, the Great Britain (they may have to change that name now) Pound moved ten percent. A one thousand dollar bet could have resulted in a one hundred thousand dollar gain. One the other hand, if your bet was wrong, well, I will leave you to figure out the losses.... The reason sterling fluctuated so much was because people who bet that the pound would go up - had to cover their margin calls. The few who bet that Britain would exit, are super rich today. Mervyn BTW, the VIX rose 49% on Friday. On Thursday there was no risk at all in buying the VIX as it was priced as if the Brits had voted to remain in the EU. A 49% return in a day is sweet, really sweet - and the volatility fun is only beginning. On Wed, Jun 22, 2016 at 6:35 AM, Bernado Colaco <ole_...@yahoo.co.uk> wrote: > It is believed that if Article 50 of the Lisboa Treaty is invoked it will > take over 2 years to deal with the EU for terms of withdrawl. Therefore > Brexiters might be disappointed that things will not happen overnight. One > newspaper suggested that Cameron would resign immediately. He might. But > somebody will have to make the deal with the EU. In the meantime the great > capitalists like Soros are enjoying the effects of talk of a plummeting > pound. > BC >