Registered: Jun 2011
04-29-12 05:22 PM
Quote from vetten:
the only problem with Dukascopy is that you can only trade spot forex, so if the business goes bust, you`re just a creditor.
I think your account size needs to be quite high, 100k?, to be able to open a bank account in your own name.
Macquarie Bank offers forex futures and other futures and your cash is safe in a bank account (not Macquarie) in your own name.
Err.. just to back up a tad. You're right about spot in the sense that there's no 'industry wide' regulation on how funds are kept (like in futures and such,) but that doesn't mean you're unprotected in all cases.
You have to go on a broker by broker basis when assessing this, and atop of that, there's regulators and standards in different areas of the world that will add funds protection.
Some brokers use segregated accounts, while this claim on its own won't protect you from illegal transfers (MFGlobal,) in a few regulated areas the claim of segregated accounts means the local regulator gets to make sure they are following through on it.
Then there's the local government's insurance programs:
I do some business with Oanda here in Canada, and my accounts are CIPF protected up to $1million. If Oanda goes under, CIPF will make sure my funds are transferred to a new institution (whoever buys up their old account base) or back to myself if I request it. It's a fast process too, we're talking weeks, not years... (I got to witness a co-worker's transfer from MFGlobal to RBC Securities.. within a few days his entire account was available at RBC to do with as he pleased. Not a dollar lost.)
For Dukas, they are a registered bank, and thus covered under the Swiss government's investment protection plan:
So if you keep your funds directly with Dukas, and they go under, you're covered up to 100,000CHF.
All this is moot though, since the context was a broker who'll work with a 3rd party bank account instead of keeping funds directly with themselves. If you go the custodian banking method I described earlier, and Dukas goes under, your funds aren't touched since they are sitting at another bank in your name.