Safety of funds

Discussion in 'Forex Brokers' started by maa_csl, Nov 16, 2005.

  1. maa_csl


    Hi everybody,

    This is my first post. I'm glad to be here. I'm from Brazil and I just trade stocks here. Now I'm looking for a firm in order to trade forex.

    I did a lot of reading about trading forex futures and spot forex. There's a lot of pros and cons about any one of them. But, my main concern about which market to trade is the safety of funds.

    According to NFA, only forex futures funds are segregated so they're safe in case of a bankruptcy. That's not happen when you're trading with a spot forex firm.

    So, since I'm not in US, what do you think about that? How safe customers funds are in these fx firms, even NFA registered? Most of the firms aren't publicly traded, so you don't have any information about their financial status.

    Thanks in advance for all replies.
  2. Refco is a good example.
  3. RefcoFx was publicly traded so you can't trust anything you read.

    I would recommend a broker such as FXCM, but have your withdraw form ready to fax and take out your profits (if any) on a regular basis.
  4. ignatius


    The Refco Group was a publicly traded company so this goes to show you that being a publicly traded company won't always be the best proctection. What's going to protect you is regulation and finding out what safety measures are put in place to protect you from the Ken Lays, Berny Ebbers, and Phil Bennets of the world.

    It is important to note that refco clients with their futures division can still withdraw funds from their accounts as well as refcofx canada which had some special sort or regulation compared with the US entity.

    So whenever trying to find a broker, make sure they are regulated.
  5. maa_csl


    Yes, you're right. It really doesn't matter being a publicly traded company.

    So, considering that futures funds are safe even with Refco, I'll probably trade with futures forex instead spot forex.

    Anyway, what kind of regulations are in place in Canada? What is the regulator entity there?

    Thanks for the replies.
  6. Also, make sure you set up a search on google to send you news that is posted about the company.

    I found out way to late, that REFCO was having problems.

    Though, in the end, it looks like I'll be alright anyways.