Despite the events of 15 January 2015, FXCM's capitalization remains at levels similar to before the SNB flash crash. I can refer you to comments from our CEO Drew Niv in an interview with Profit & Loss Magazine: "Financially, we lost $300 million and then we got $300 million from Leucadia, so by Monday 19th of January, the company was fine in terms of balance sheet. Yes, because were a public venue you can see that our stock is a fraction of what it was, but people need to understand that the size of the pie hasnt changed, its just that the ownership of that pie has. So the stock implies that the legacy shareholders of FXCM only own a small piece of the firm and Leucadia owns a much bigger piece, although the final determination on that will be made later this year once weve divested the assets were selling. This is about the economics to the owners of the firm, it has nothing to do with customers." In other words, the terms of the Leucadia loan impact FXCM shareholders, not FXCM account holders. Our clients appreciate this fact which is why the latest financial data from the CFTC show traders continue to have more money on deposit with FXCM than any other US-regulated forex broker. If you currently have an account with a broker that can no longer offer forex trading in the US, I encourage you to consider FXCM particularly for the No Dealing Desk (NDD) execution and low spreads we provide to all Standard and Active Trader accounts.
Unfortunately, the client profitability stats you referenced don't take into account the difference in account opening minimums between brokers. Therefore, what they end up showing is the correlation between account balance and profitability which is also confirmed by our research. It's important to note that FXCM offers services to traders at all levels, including Mini accounts ($50 minimum), Standard accounts (5k minimum), Active Trader accounts (25k minimum) and multi-million dollar institutional (FXCM Pro) accounts. By contrast, your current broker has a minimum account opening balance of $10,000. Below are stats from a DailyFX study on trader profitability in relation to account balance based on thousands of FXCM accounts. It showed that FXCM clients with an account balance of at least $10,000 had a profitability percentage of 43% which is comparable to the client profitability stats for your current broker mentioned in the report you saw. With the NDD model, FXCM offsets each of your orders one-for-one with the best prices from competing liquidity providers. That means we don't profit from your losses or lose from your profits. Instead, FXCM makes money from your trading volume, and we want you to be profitable, so you can trade more. High volume traders might be particularly interested in our new Market Depth indicator.
Well, isn't that kinda what i said....only a few FX firms left here in the US, take IB off that list and leaves only FXCM, Gain. I did not even know Oanda took US customers. Are you trying to explain why a majority of FXCM customers lose is ok? doesn't FXCM profit when customers lose?
As I mentioned in my previous post, with the No Dealing Desk (NDD) forex execution we provide to all Standard accounts* (5k minimum) and Active Trader accounts (25k minimum), FXCM offsets each client order one-for-one with the best prices from competing liquidity providers. That means we don't profit from client losses or lose from client profits. Instead, FXCM makes money from client trading volume. Therefore, we want you to be profitable, so you can trade more. In fact, our DailyFX research team even did a study on trader profitability to help our clients learn best practices from the most successful traders. It showed that FXCM clients with an account balance of at least $10,000 had a profitability percentage of 43% which is comparable to the client profitability stats for IB which has a 10k minimum for all their forex accounts. * In addition to the NDD model FXCM uses for all Standard and Active Trader accounts, we also offers Mini accounts ($50 minimum) which use DD execution.
Ok Jas, we didn't know that. Its a shame its reported like that because i honestly thought FXCM was a shady company.
I'm glad I was able to address your concerns. When making an apples-to-apples comparison, FXCM's pricing and execution are very competitive.