What happens if your broker goes bust?

Money belonging to Alpari's clients is currently trapped in the firm. Cris Sholto Heaton looks at the rules for getting your money back.

The Swiss National Bank's (SNB) entirely unexpected decision to allow the Swiss franc to float freely against the euro last week had major consequences for firms that offer currency trading services.

Many traders had been betting on the euro remaining above SFr1.20. In the chaos that followed the SNB's decision to let the euro go, liquidity in the currency markets dried up and they were unable to close their positions before incurring substantial losses. The high levels of leverage (borrowed money) that many traders were using magnified these losses.

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Cris Sholto Heaton

Cris Sholto Heaton is an investment analyst and writer who has been contributing to MoneyWeek since 2006 and was managing editor of the magazine between 2016 and 2018. He is especially interested in international investing, believing many investors still focus too much on their home markets and that it pays to take advantage of all the opportunities the world offers. He often writes about Asian equities, international income and global asset allocation.

Cris began his career in financial services consultancy at PwC and Lane Clark & Peacock, before an abrupt change of direction into oil, gas and energy at Petroleum Economist and Platts and subsequently into investment research and writing. In addition to his articles for MoneyWeek, he also works with a number of asset managers, consultancies and financial information providers.

He holds the Chartered Financial Analyst designation and the Investment Management Certificate, as well as degrees in finance and mathematics. He has also studied acting, film-making and photography, and strongly suspects that an awareness of what makes a compelling story is just as important for understanding markets as any amount of qualifications.