FX brokers showed the Profit and Loss of their clients

New ESMA regulations forced brokers to be more transparent about their loss statistics. The results are fascinating



source https://www.financemagnates.com/for...ers-house-the-most-winning-clients-post-esma/

 

Wow seems like IB's clients outperform by alot!

https://www.interactivebrokers.com/en/index.php?f=3731

 

I don't trust such reports. It's too good to be true.

How do you define profitable?

some of the definitions of profitable trader :

If a trader can earn money (even few dollars ) in a month (even though he has been trading for years)


If a trader earn few dollars continuously for 4 weeks (even though he has been trading for years)
etc etc etc




This is how I'd define profitable trader :
If a trader earns > $100 000 in one whole year.

if a trader is paying taxes for forex trading gains


Can someone shed light on how they define PROFITABLE ?

my estimation is only < 5% can make it.

 

My most immediate guess would be their realized + unrealized profit > 0, ignoring taxes paid on the years profitable...

 

I think it is based on a 3 month period.

 

fx market making is a very good business... how can I start my own firm? lol..

 

This is nothing new. All the forex brokers have been doing this for years. As much as I hate IB, IB always had the highest profit-to-loss ratio for their forex clients with Oanda in the second place. And it's not surprising as IB, has the closest of forex brokerage operation to that of an ECN or DMA (besides LMAX which is a TRULY forex Exchange with an open order book). All other brokers are either pure market makers or a hybrid of market making/STP with an operation of what is known as "B-Booking" and that is why their client profit-to-loss ratio is so low. Oanda is a little different. It is a market maker but hedges against their clients' net positions so their position risk is neutral. But ironically, the two best brokers for forex traders that had the most honest operation, IB and Oanda have ceased to exist. IB had been forced to shut down its retail forex operation by SEC and Oanda has since been taken over by another company. Now the retail forex scene is just dominated by market makers and b-bookers who basically trade against their clients and make money at their expense instead of earning via commissions which is what a broker is supposed to do.

 

$5 million USD and you can start as a white label. There are firms out there that will even help you set up everything with a prime broker and many prime brokers even provide what is called "Turnkey broker" solution to help you start the operation so you have a brokerage from the get-go ready to take your clients' money. It's not difficult anymore.

 

But we need to know how they define it and for what period. It looks way too high.