I have recently received a "new risk disclosure" agreement on 11 April 2014 which basically states that futures trading customer money would not be segregated and insured in any cases of failure. I would like to make a poll here if your FCMs recently sending the same thing. It would help to check potentially good/bad firms. My firm: Dorman Trading
Guys, CFTC required them to send it - basically nothing has changed. Your money has never been insured by a FCM (exception is Interactive Brokers which is not a pure FCM) and it is in a segregated account but not segregated from other customers accounts - only segregated from the broker's account. Btw: Never leave more funds than necessary with your broker.
It's very strange. CFTC required FCMs to segregate customer fund and safeguard it but it also asks FCMs to send out kind of new contractual risk agreements saying that there's obviously no fund segregation or safety (note that they don't use the word "can" or "may be") By do that, who is going to sue the FCMs in case of a fund theft and get back our money since we clients now can't sue because we have "agreed" to the new risk disclosure ?? So in case of fund failure, it would be at the mercy/discretion of CFTC to choose what they want to do whether they want to get our money back or not !
Exactly. As you say, this has always been the case. The CFTC has just decided that FCMs must explicitely state the risks since most amateurs don't have a clue. Do your research before you deposit funds. Some FCMs are more financially stable and prudent than others. Personally I wouldn't touch an FCM that engages in any prop activites. I want my FCM to be in the business of clearing, and only clearing. It's less than a couple of years since Knight's inglorious algo cluster fuck which cost them $440M and very nearly sunk them.