Is broker stealing my money?

Discussion in 'Forex' started by skaranam, Jan 20, 2006.

  1. skaranam


    I have just started trading Forex and it is been my second month. So far I did about half-a-dozen round trips transactions. I never really paid much attention to the statements but last night I went through the daily reports and I noticed a very strange thing. My account is not getting enough credit. Here is one of the transaction.

    1/15/2005 GBP/USD -16000 1.7785
    1/16/2005 GBP/USD 16000 1.7655

    As you can see, I made a profit of 130 pips. So, my account should have got a credit of 130*1.6 =$ 208, but I didn't. Here is what the statements showed.

    Daily statement 1/15/2005

    Net trade = $161.60.

    They arrived at this number as follows.
    1.7785*16000 - 1.7684*16000= 161.60.
    I have no clue what this 1.7684 is. Probably a LIBOR rate or something.

    Daily statement 1/16/2005

    Net trade = $35.20

    They arrived at this number as follows.
    1.7677*16000 - 1.7655*16000=35.20

    So, total credited to my account is 161.60+35.20=$196.8, but I should have got $208, Is this how calculations are done for Forex?
  2. When I tried a demo with FXCM and Refco then, what I noticed is that if the asked is say 1.7625 and you are buying say that currency, say the British pound----you would have to pay an extra 5 pips or 0.0005 to buy the currency. In this case, if you wanted to buy----you would end up paying 1.7630 instead due to the spread. The same when you sell----it would be 5 pips less than the quoted price. That is where the broker made his money and not on commission. A pip is roughly equivalent to about $10.00 for a mini-accoutn if I am not mistaken so, 5 pips is $50.00 less from you account each way (buying and selling).
  3. skaranam - which broker r u using?

    seems they r just charging u cost of carry for the overnight trade. 7 pips is pretty high except if its a weds o/n charge, i.e. 3x normal amount, but i don't understand yr dates (jan 2005???)... anyway why don't u ask THEM first?
  4. That's just insane. A round trip on a pound future will cost you 1 tick in commission, with a 1-2 tick spread.
  5. 1in10


    If you investigate how your broker deals with roll over I am sure you will find they close positions at a predetermined time and re-open it in your account to adjust for interest rate.

    Thus the difference in your calculated interest. This does seem high, but your are paying interest and spread on the reopen. Some brokers will charge a premium on "mini accounts."

  6. skaranam


    I am using. Sorry. All the dates has to be 2006. I am still in the last year.