September Net Capital Report The CFTC has just released their latest net capital figures. The big news is that everyone is doing well. Firms are seeing big jumps in net capital as forex brokers appear to be raking in the cash in this volatile market. It doesnât appear that anyone has had difficulty clearing the $10 million hurdle judging by the fact the NFA has not closed down anyone since Halloween (although AMIFX continues to report way below the $10 million requirement although keep in mind CFTC reports lag a full month behind current date.) The only other change appears to be that IFX and FX Solutions have formally merged as IFX is no longer listed on the CFTC Report. http://www.cftc.gov/marketreports/financialdataforfcms/index.htm The following firms have net capital below $10 million Advanced Markets $6,743,000 Friedberg Mercantile $8,164,000 ACM $8,891,000 Forex Club $9,615,000 Easy Forex $9,943,000 The following firms have net capital below $20 million Hotspot $10,021,000 Ikon $10,424,000 GFS Forex $11,908,000 MB Trading $14,245,000 ODL $15,180,000 I Trade FX $17,258,000 Alpari $17,437,000 The following firms have net capital above $20 million FX Solutions $21,197,000 CMS Forex $22,018,000 PFG $22,038,000 Interbank FX $37,596,000 GFT Forex $67,073,000 Gain Capital $77,580,000 FXCM $114,299,000 Oanda $168,344,000 As always conduct your due diligence and make sure the firm you are trading with will be able to comply with the new $20 million capital requirement going into effect in the months ahead.
The Pirates of Scandinavia Last month the S.S. Saxo Bank forced hundreds of employees to walk the plank in a furious effort to keep their Danish Longship from taking on any more water amidst the financial tsunami that has engulfed CFD brokers around the world. But it is another former shipmate of Saxo that has now taken to his Somalia-like pirate ship to fire pot shots at this listing to port Viking Broker. Ahoy itâs Charles-Henri Sabet! With parrot perched on shoulder and a black eye patch in place Sabet has Saxo in his sights⦠According to Euromoney Magazine in an article titled âCharles Henri Sabet Bites Back in Saxo Sagaâ Sabet says that he was exiled to Davey Jones locker because of a shareholder dispute, not because of an SFBC investigation of alleged insider trading. http://www.euromoney.com/Article/20...rles-Henri-Sabet-bites-back-in-Saxo-saga.html So how did this investigation come about? Euromoney states: So instead of paying Sabet his share of Saxoâs booty the scallywags in Denmark simply ratted him out to regulators? Shiver me timbers thatâs a low thing to do to a mate. But Sabet wasnât the only one sent to the brig. Yarrrgh matey, Saxo ainât likely to depart from its treasure anytime soon. This Sabet fellow could be waiting a long time before he sees one gold doubloon from the cash strapped folks in Denmark. I reckon Sabet would have a better chance demanding ransoms from oil tanker owning Saudi princes than from a forex and cfd broker that had been spending money like a drunken sailor on shore leave prior to the financial panic. Arrgh, Sabet best crack open a bottle of Rum and batten down the hatches cause Saxo will fight him to the last cannon ball over that 5% share. To be continued Iâm sure.
The Taming of the Wild West The forex market has long been known as the Wild West of Finance due to its unregulated nature. But the frontier is being tamed and it now appears the day of the unregulated Introducing Broker is drawing to a close. While the CFTC has not yet released its new Forex Dealer rules to the public the NFA just issued a preliminary set of guidelines for all introducing brokers who are now required by law to be licensed: http://www.nfa.futures.org/compliance/forex_registration_overview.asp Among the rules, IBs must maintain net capital of $45,000. Aside from other requirements like proficiency exams and disclosure documents the NFA is doing background checks which require finger printing: This should help drive some of the industryâs worst cattle rustlers out of the market and into a new line of work, like holding up banks instead... It remains to be seen just how onerous the new rules from the CFTC will be but with the NFA releasing this guide now the CFTC shouldnât be too far behind.
October Net Capital Report The U.S. retail forex industry appears to be soaring over the new capital requirements by leaps and bounds. October showed an across the board increase in virtually every dealerâs net capital. Still, for some firms it is a long way to $20 million. And while small firms like ACM and Advanced Markets were able to meet the first barrier the Savior will be watching closely to see if they can keep it up. http://www.cftc.gov/marketreports/financialdataforfcms/index.htm The following firms have net capital below $15 million Advanced Markets $10,163,000 Hotspot $10,559,000 Easy Forex $10,891,000 ACM $11,855,000 GFS Forex $12,503,000 MB Trading $14,522,000 The following firms have net capital below $20 million Ikon $15,033,000 Forex Club $16,489,000 Alpari $18,212,000 I Trade FX $18,411,000 ODL $19,991,000 The following firms have net capital above $20 million PFG $21,809,000 CMS Forex $25,162,000 Interbank FX $40,892,000 FX Solutions $43,570,000 GFT Forex $76,980,000 Gain Capital $96,371,000 FXCM $122,924,000 Oanda $170,982,000 As always conduct your due diligence and make sure the firm you are trading with will be able to comply with the new $20 million capital requirement going into effect in the months ahead.
NFA Drops Another Bombshell The National Futures Association has passed some new rules that all traders should be aware of ASAP: http://www.nfa.futures.org/news/PDF/CFTC/CR2_43_ForexPriceAdj_112408.pdf Translation- No more âadjustments,â unless these adjustments meet strict NFA standards. Translation- no more hedging of the same position. These are profound changes. How many times have traders complained about profits being âremovedâ from their accounts? Well, if you trade with a NFA registered firm those days appear to be over. The hedging prohibition may upset some traders but truth be told there is little logic behind holding the opposite positions in the same currency pair. Still, you would think traders would be allowed to trade as they see fit without the nanny state running around dictating what positions you are allowed to hold. In any case the evolution of FX trading continuesâ¦
Should have seen this comming!!! Now that CFTC have raised the caps squeezed out the smaller market makers and monopolized the US FX industry, the CFTC/NFA and their dues paying club members ( FCMâs) will all now work together to put the disadvantage on the traders side. 1 More good reason to steer clear of the US FX firms. Investor protection my ass, more on the lines of socialism for the few.
Huh? What are you smoking Big Gun? What trader wouldn't want to trade with a firm that isn't allowed to take confiscate profits from your account? If you want to trade with some offshore bucketshop that freely swipes profits out of the accounts of winning traders they are plenty of sharks you can deal with. But I'm guessing most traders prefer the NFA's approach.