Am I crazy or is FXCM crooked?

Discussion in 'Forex Brokers' started by cking74, Jul 28, 2006.

  1. No, but you should immediately sign-on for the service ASAP. That way you can prove once and for all that you actually are crazy.

    Either that.

    Or stupid as can be.

    Later,

    Jimmy
     
    #31     Jul 31, 2006
  2. ddunbar

    ddunbar Guest

    Still, a conflict of interest exists. While they use multiple banks as liquidity providers as all ECN style brokers do such as Currenex. Hotspot FXi, IB, MB Trading , etc, (which Prop FX is nearly claiming to be like), they (Prop FX) charge no fees or commissions (which all ECNs do) but instead get rebated back from the banks feeding the platform based on the volume and currency pairs traded.

    Another curious thing is that FXCM is indifferent about whether a client choses to trade on their retail platform or on their Prop platform. Now why would that be? (The only difference is account opening sizes.)
     
    #32     Jul 31, 2006
  3. I don't think Prop FX get's rebated by
    the banks, they just mark-up the spread
    so that they get 1 pip RT commission
    per trade
     
    #33     Jul 31, 2006
  4. ddunbar

    ddunbar Guest

    They actually do get rebated. And they'll tell you as much if you ask. But even if you didn't know for sure, if you look at their platform, it would not be possible to shade prices. It's similiar to Currenex's platform in some respects. The only reasonable conclusion since they don't charge a commission like every other Spot Forex ECN, and have a low minimum deal size of 50,000, is that they make money via rebates. AKA, kickbacks... to put a more villianous twist to the term rebate.
     
    #34     Jul 31, 2006
  5. 168

    168

    they get rebate plus extra spread .
     
    #35     Jul 31, 2006
  6. why not just avoid the company altogether and trade through one of the "ecns"?

    the avoidance of commish in forex trading really does a lot of damage in the long run. The commish is really low at most ecns, usually less than the extra spread, and more importantly, no requotes or unfilled orders.
     
    #36     Jul 31, 2006
  7. ddunbar

    ddunbar Guest

    Extra spread? As in price shading? I haven't seen their platform lately but if they aren't offering 1/2 pip quote increments, then there may yet be the possibility of price shading with PropFX division.
     
    #37     Jul 31, 2006
  8. ddunbar

    ddunbar Guest

    That would be best.
     
    #38     Jul 31, 2006
  9. 168

    168

    they are more expensive than the adm or odl's currenex , but they do go throughs the currenex and deep liquidity , they are at least better than the ibex or mig or acm by no requote and no scalping .
     
    #39     Jul 31, 2006
  10. sim03

    sim03

    "Extra spread" refers to the 1-pip markup of the spread by FXCM's PropFX division, as pointed out above by NickBarings. It does not refer to price shading.
     
    #40     Jul 31, 2006