I just checked CFTC FCM financial report and found out FXCM's net dropped to 19Mio and Hotspot had negative balance (-1.2Mio). Anybody know what happened?
I don't think anybody likes them anymore and are bailing out. You know, before the "Refco" disease hits town...
Hmm... I thought they were doing pretty well. It is bit of suprise to me. hoprfully, it is just typo from CFTC. Hate to see another Refco incident here. if it is, that means CFTC regulation is BS and totally worthless. It will hurt entire forex industry big time.
Not sure about FXCM but I know that Hotspot was bought by Knight Capital several months ago and the deal was finalized a couple of days ago. Could be something to do with that. They will still operate under the Hotspot name but as a wholly owned subsidiary of Knight Capital. http://www.knight.com/MediaCenter/PressReleases.asp?releaseID=837886
The safety of your funds is far more important than getting an reasonable answer first why Hotspot or FXCM %#$%^&. If they are OK in next couple of months, you still have chance to wire funds back to them. FYI, none of those FCMs which only provides forex spot trading is required by CFTC/NFA rules to segregate your funds, and no investor protection funds like SIPC is designed for forex spot trading. If any of those FCMs failed, it would simply be another Refco case. CFTC actually has no authority to regulate forex spot trading before this proposal is passed. It is a trick to make themselves look like truly and fully legal and regulated for those FCMs.
feb 2006 cftc figures: 82 HOTSPOT FX INC N NFA 02/28/2006 7,424,810 250,000 7,174,810 0 0 83 HOTSPOT FXR LLC N NFA 02/28/2006 -1,296,426 250,000 -1,546,426 0 0
HOTSPOT FX INC ⢠NFA MEMBER WITHDRAWN 02/17/2006 ⢠FUTURES COMMISSION MERCHANT WITHDRAWN 02/17/2006
Another possible Refco disaster coming? DId anybody with Hotspot FX contact them recently about this issue?
I haven't heard anything from them but I do know that their sale just was completed to Knight Capital which may have something to do with it. Also Hotspot's retail division is still registered with no problem according to the NFA. http://www.nfa.futures.org/basicnet/Details.aspx?entityid=0351580&rn=Y