CFTC issues final forex exchange market rule

It seems obvious to me that the CFTC cannot prevent US citizens from doing business with non-US entities.

 

I think the days of retail speculation are numbered. Glad they capped at 50 to 1.

 

http://online.wsj.com/article/SB10001424052748704421104575463480313256258.html

2% deposit on major currencies seems on par with what banks like Citi can offer on retail-forex now, as Citi is not regulated by the CFTC. Seems like the regulators were sensitive to chasing business abroad and giving it to big banks at the expense of US retail forex dealers. That's better news.

 

The CFTC’s new rule calling for a 2% deposit on trading major forex currencies off-exchange (50:1) seems on par with what commercial banks like Citi FX Pro offer their retail forex trading customers now. So it’s a wise move by the CFTC to reduce leverage by two-times (100:1 industry standard to 50:1), rather than going way over board with its proposal of 10:1. Unlike most off-exchange retail forex dealers in the U.S., Citi FX is not regulated by the CFTC; it’s subject to bank regulation instead.

Thankfully, the CFTC responded to the pleas from the off-exchange retail forex trading industry saying the CFTC’s proposed 10:1 leverage would put the industry at a huge competitive disadvantage to on-exchange currency futures trading (30:1), commercial bank forex trading (50:1) and offshore off-exchange retail forex trading (200:1). See http://online.wsj.com/article/BT-CO-20100730-715762.html

Regulators and Congress are often sensitive to chasing business abroad and taking business from small-business to hand it over to big banks.

The new deposit rule for non-major currencies is 5% (20:1) and this will probably lead to lots of retail traders asking about the opportunities to trade on foreign platforms.

We will study the new rules and see if offshore trading remains feasible for Americans under new provisions in Dodd-Frank Fin Reg. We discussed how it could be a problem for American’s using offshore platforms on our recent blog and podcast.

Robert A. Green, CEO Traders Association.

 

Oanda doesn't fall under this rule since they are based in Canada ?

 

Why? Is my successful retail trading a threat to you? Hope "they" castrate you soon. Limiting the supply of nanny-state loving, arbitrary-rule making tools could be a good thing, no?

 

Thanks for all your great work on this. I'm glad we at least didn't get 10:1. Maybe all this ridiculous micromanagement will get derailed after November.

 

Ironic that in the nanny-state that is the UK (cameras everywhere, NHS, etc.), they have willhill and ladbrokes everywhere, virtually unlimited CFD leverage and all sorts of structured product. We're becoming a 3rd rate financial power.

 

Indeed. Although a US citizen, I still have 400:1 via a disreputable broker that shall remain nameless, in the UK.

 

LOL that's not what I meant, dumbass.