I am looking at using IC Markets in Australia as my preferred broker(as I have heard good things about them even though they have been known to post fake replies and reviews on forums), BUT like most brokers, it is not easy to find a reputable and transparent broker. I was doing some research on them and this is what I came up with... According to the company policy; Clients' money is pooled together within a trust account and so an individual client's balance may not be protected if there is a default by another client which causes a loss to the overall trust account. Under the Corporations Act and the Corporations Regulations, we may pay money out of a trust account in the following circumstances: Could someone break this down to me layman terms? My main concern is losing all my funds due to a broker going bankrupt for some reason and then not being able see my money. I have read to many horror stories online with other brokers going broke and then the traders are forced to take action and go to court to try and get some of their money back. I always thought that any company that offers smaller lot sizes such as Micro would most likely be a market maker or a dealing desk and then for most companies offering ECN (Electronic Communications Networks) environments, the minimum margin for interbanking dealing is 100:1. Wouldn't a company offering higher leverage be, most likely, a market maker or a dealing desk broker? Would it be fair to label IC Markets or most so called brokers market makers even though they claim otherwise because there is no proper regulation in place like the futures market or stock market? I guess the reason why i do contemplate trading the futures market is because it is a very well regulated and transparent compared to the murky world of forex trading. Any opinions or advice would be much appreciated. Thank you
I'm not entirely convinced about aussie client money regulation. For example, read that: http://forexmagnates.com/gtl-tradeup-an-australian-fx-broker-goes-belly-up-down-under/ Apparently all client funds are lost, the scumbag hides in NZ for now. I would reccomend the UK. If you are classified as retail or small business, at least the first GBP 80K are protected. And as far as FX is concerned, London is the center of the world anyways.
Thanks for that article. Makes ASIC regulation look like a bit of a joke. I decided to sign up with IC Markets, but I might change my mind after reading this. Which broker would you recommend in the UK?
Personally i'm using lmax. There are a few more i would consider, Depending on your account size. Interactive brokers, Oanda, LCGFX are solid too.