Comments on: CFTC vs FXDC – Battle for Fair Leverage

By: Sundarajoo

Sundarajoo — Thu, 29 Mar 2012 01:45:00 +0000

I agree with CFTC on the 10:1 leverage, however imposing the rule may be difficult. Brokers can use their moral values by restricting new traders to 10:1 leverage and after 1-2 years increasing the leverage. However, brokers should not have leverage in excess of 50:1. I am sure most of you are aware that professional traders do not leverage more than 5:1 leverage. Why should than novices do more than that leverage. If brokers can advice clients to trade forex as a business rather than that of a speculative nature, the industry will move to a healthier situation in the long run.

By: Lee Joo Mong

Lee Joo Mong — Sat, 01 May 2010 19:00:51 +0000

Where I live, I believe in saving lives more than profits. Those who can not afford the initial capital to start with 10:1 leverage unlikely to be suitable for live forex trading (they lack the stamina/discipline required to focus on the forex trading)

Example: If the trader gets insomia from profit with the first trade done. That trader more likely to commit suicide if it was a much heavier loss instead

By: wenzi

wenzi — Sun, 28 Feb 2010 00:56:20 +0000

I think the margin requirements will stick and they should. All of this came about by to legal cases ( CFTC vs Zelener, CFTC vs Erskine ) which said the CFTC could not regulate fraud in the retail forex industry. The 2008 Farm Bill in the US changed this and the CFTC is now responsible for retail Forex.

There are few problems with off exchange Forex, ( lack of a central counter party and fund segregation ) that does not exist with on exchange forex trading. If these brokers really cared they would create their own regulated exchange ( Such as Nadex ) and trade on it for their clients.

They won’t because that would be the end of their dealing desks, stop running and their profits. They are complaining against this rule, not to fight for the ‘little guy’ but to protect their dealing desks and the profits that come with it.

And by the way, the CFTC is a much better regulator than the SEC. The SEC limits day trading leverage to 4:1 and 2:1 overnight, and requires $25,000 in the account to allow day trading. The CFTC allows greater than 100:1 leverage on futures that are on an CFTC exchange and without a minimum requirement for day trading.

By: RR

RR — Thu, 25 Feb 2010 22:50:57 +0000

The brokers don’t like this idea, why? because nearly all of you are using too much leverage. Because of this and other noob practices like tight stop losses and positive R:R most of you will lose money to them. 10:1 leverage is still too high. However, if the brokers are forced to 10:1 they will have to make more money in other ways (because it wont be so easy to clean out your accounts) this will mean larger spreads.

By: CFTC vs FXDC – Battle for Fair Leverage | Forex and Currency Trading News , Analysis , Information and Education

Sat, 20 Feb 2010 19:45:15 +0000

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By: Shawn

Shawn — Sat, 20 Feb 2010 06:39:15 +0000

I know of tons of people who blow all their money on online poker. Why are forex brokers being antogonized?

By: Nate Parham

Nate Parham — Sat, 20 Feb 2010 04:04:49 +0000

Just like or government to screw with the few good things we have left. They cant get anything else right , i really don’t know why they think they should be giving us rules on our leverages dealing with our own money. They don’t give us a choice on what they blow our hard earned money on. I say we all get together to start our own little country without all the taxes and government. Haha only if that would work, well i guess we have to voice our opinion . Join in a tax revolt also, onlinetaxrevolt.com , lets get our voice out , all for the fair tax and 100 to 1 leverage speak now or forever hold your well u have nothing left. Thanks
Nate from the U.S.A.

By: Conrad

Conrad — Fri, 19 Feb 2010 04:49:13 +0000

If they lower the leverage to 10=1 ,my interest in this market will fade away

By: cevka

cevka — Thu, 18 Feb 2010 23:09:37 +0000

go spread bet

By: Erico

Erico — Thu, 18 Feb 2010 22:33:02 +0000

The plan to set the maximum leverage for US retail forex to 10:1.
This is by far the worst of the regulations. While it is important to
protect naive first time traders who might out their life savings by
using too much leverage, this will affect everyone else who uses
sensible money management. It will only make traders look out for
other countries that have favourable leverage limits. One of the
attractiveness of forex trading is the leverage offered and one of the
most important forex lessons is money management and using leverage
wisely. Leverage is a very important tool and albeit dangerous tool.
What the Government should do is educate the public instead of punishing
the traders who know how to effectively use the tools. That’s like taking out the sharp tools out so that uneducated, naive, get rich quick traders don’t get hurt. New traders should be advised to get educated about the forex market before
starting to trade. Forex is hard work, you have to put in the hours to reap the benefits.