Investors to sue Moscow Exchange over stoppage of WTI oil trading

[prostotrader]

Investors to sue Moscow Exchange over WTI oil trading halt

Investors had no opportunity to reduce or limit their risk when WTI crude oil prices plunged to negative levels

Investors are preparing a class action lawsuit against Moscow Exchange over the suspension of trading in the WTI crude oil contract on April 20. On that day for the first time in history the price of this oil grade plummeted to negative values. The lawsuit is being prepared by the law firm Milton Legal; its partner Sergey Shakirov told RBC about its preparation.

On April 20, Mosbirch restricted the trading range to $8.84 a barrel, he said. "None of the buyers on the Russian section of the exchange, which is about 700 people according to preliminary estimates, had an opportunity to reduce or limit their risks," Shakirov explained.

In addition, it is technically impossible to put up a minus order on Moscow Exchange, the system rejects it as not complying with the regulations, partner Milton Legal said. "So anyone who tried to sell at least a small minus, for example, when the price was minus $5, could not do so and simply watched the price fall to minus $37," Shakirov said.

The next day, Moscow Exchange suspended trading for half a day. According to the lawyer, the positions of all Russian investors were closed at minus $37 a barrel.


Read more on RBC:

https://www.rbc.ru/business/24/04/2020/5ea2be239a79479b2b72e82f?from=from_main

[Rashid Umarov]

Corrected your post to make it look better

[Алексей Тарабанов]

Rashid Umarov:
Corrected your post to make it look better

)

[Denis Kirichenko]

Why not sue the Central Bank right away? Pranksters... To go to war with government agencies and their affiliated organisations is to spit against the wind. In the end they will put them to listen to a song by the band Leningrad "Go to..." imho.

[Aleksey Semenov]

that's a real bummer, how much did those 700 people get, I think the best they can do is recalculate at the minimum allowable contract price of 0.01 cent

[Roman]

Do not trade a contract that has a cut-off or expiry day!
Always close your positions before that day!
This is a quote from my American broker, who literally drummed it into my head.
When I first opened the account he called me a week before every expiration day and warned me that you have positions that need to be closed and reduced.
This is what a conscientious broker who is regulated by the supervisory commissions and does not want any problems with the stock exchange means.

[Georgiy Merts]

Of course, to go long on a declining asset and just before expiry is... I don't know what kind of miracle we're hoping for...

But, I think that "everyone will make their own way". Debt to traders will be written off, but they will not give them money. Traded.

[Alexsandr San]

Risks are always risks.

If there was a farm (e.g. pigs), if they died, that would also be a risk.

[Georgiy Merts]

Alexsandr San:

Risks are always risks.

If there was a farm (e.g. pigs), if they died, that would also be a risk.

No... it's a slightly different situation... There was a farm and not only did the pigs die, but you also had to pay for all the unborn piglets and their feed.

[Alexsandr San]

Georgiy Merts:

No... it's a different situation... There was a farm and not only did the pigs die, but you had to pay for all the unborn piglets and their feed.

that's right! And as usual, you start again. Unless the rest is taken away.

[ascerdfg]

Imho will win the trial. There is no possibility of placing orders with a negative price and there was no possibility of closing unprofitable positions themselves.