Brokers that are doing badly

[Neuroway]

Hi everyone,

As traders, we take lots of risk with our own capital. That is normal. But what shouldn't be normal is having to deal with a business infested with crooks, hypocrites and deceitful liars.

My trading career has been marked by these experiences (amongst others):

1) RefcoFX (USA): Apparently, at the time, this was the biggest, safest broker on the block. The crook at the helm of the firm, Phillip Bennet (British educated in Cambridge University), was hiding $430 millions in bad debts, hid behind the USA bankruptcy (crook protection) laws, and more than 200,000 creditors (including myself) lost their trading account with all the money inside it.

2) MtGox (Japan): Was the world leading bitcoin exchange. Mark Karpeles (French educated in Paris) was spending MtGox customer's money on prostitutes instead of fixing the security holes of his firm. Result: MtGox went bankrupt, and all the creditors (including myself) are still waiting for their money.

3) AvaTrade (Ireland): It is not bankrupt, but recently, just like Cassini crashing into Saturn, it suddenly went silent, customer support not answering phone neither email, and creditors (including myself) are waiting....

My question: Any safe, reliable, honest, virtuous broker around? I can say good things about Oanda, having done business with them for almost 10 years. But will it last? I want good execution. I want to be able to withdraw and deposit my money without problems. I want small slippage. I want to deal with honest people, not crooks that steal my money and go hide behind their local bankruptcy laws.

 

[CALLumbus]

Hi,

what do you want to trade ? For futures, there are plenty of good brokers/ FCMs around, even for retailers. IB, Dorman, RCG, Advantage Futures ... all good FCMs with excellent reputation.

If you want to trade retail (spot) FX, it might be more difficult. Lots of bucketshops around, but also some that seem to be pretty good: I like Dukascopy and IC markets.

But of course, and your personal experience is best proof of it, you can never be 100% sure.
So what else we can do ? A few things, for example only keep the amount of cash in your margin account that you really need for your trading. One should also consider using 2 or 3 brokers/ FCMs instead of only one, and spread your trading capital among them. That way, you also have a backup solution if there is a problem with one of the brokers.

 

[Xela]

I'm guessing that the OP must be talking about spot forex (given where he's posted, and that this is kind of The Big Issue with spot forex "brokers").

I haven't traded spot for years, so I'm not sure how relevant my opinion is, but for what it's worth (if anything) I think it's really difficult to do better than Oanda, for those without enough funds to use IB. Even though I understand their spreads are a little more variable now than back when I used them.

I used Oanda when I started off. There's no such thing as certainty, but to me using them always felt like I'd done everything I could to reduce risks and get the odds on my side. (I still switched to IB as soon as I had enough funds, though).

People who use "brokers" with lamentable regulatory histories, and "brokers" that are lightly "regulated" in Cyprus, the Caribbean and the Seychelles should have their heads examined. And if the person who examines them finds anything much inside them, he should have his head examined, too. Those are places to go swimming and surfing, not places to trade forex.

 

[Neuroway]

I swing trade pretty much anything I can put my eyes on (except futures), unless the minimum lot size or the volatility are too big for me to ride with the capital I have, from physical metals to crypto currencies. I am also doing business with a bunch of brokers (kitco, avatrade, SwissQuote (former MigBank), Agea, eToro, Oanda, and looking to diversify my brokers even more as my capital is growing, hence my question. I heard about Dukascopy, will probably try them. I heard also about SaxoBank, tried to open an account, sent all the documents and never heard back from them, and it was supposedly a good broker. Well they're flushed from my list now. If I have to call customer support to find out where my documents are, imagine when I want to find out where my money is.

 

[Overnight]

...and the Seychelles should have their heads examined...

Xela wins the ET-least-known-country-of-the-month-award award.

 

[Neuroway]

I haven't traded spot for years, so I'm not sure how relevant my opinion is, but for what it's worth (if anything) I think it's really difficult to do better than Oanda, for those without enough funds to use IB.

IB, Interactive Brokers? I heard about them too. I will give them a try. My biggest problem with regulation is Canada's IIROC, actually.

Best,

 

[Neuroway]

Xela wins the ET-least-known-country-of-the-month-award award.

Hmm... I am actually thinking about leaving Canada soon for Gibraltar or Malta (not quite decided between the two yet). I'm tired of big ugly nose governments constently sniffing your bank account to suck up as much tax money as they can. I have my eyes on Lichenstein, Monaco and Andorra, but right now those places are a bit expensive for me.

 

[Xela]

IB, Interactive Brokers? I heard about them too. I will give them a try.

They're good, safe, reliable, etc. etc. but customer service is not their forte (they're for customers who don't/won't need much technical help or hand-holding), and their margins can be higher than elsewhere.

I don't know what their minimum account-opening level is for Canada, for spot forex (in the US, it's now absolutely huge: millions! But not everywhere.)

 

[Xela]

Xela wins the ET-least-known-country-of-the-month-award award.

Lol, the Seychelles is known (over here, anyway) for ultra-light regulation of dodgy, scammy spot forex "brokers".

The "regulator" is the Seychelles International Business Authority, which evidently likes to do as little as possible and to keep sanctions and penalties to a minimum for a variety of financial crimes, manipulation, and malpractice; unlike European and U.S. regulatory bodies, SIBA doesn't even have a proper, professional website.

 

[tommcginnis]

1) RefcoFX (USA): Apparently, at the time,...

2) MtGox (Japan): Was the world leading bitcoin...

3) AvaTrade (Ireland): "Who?!?!"

Sorry to put it this way but, if this were a Jeopardy question, my response would be....


"What are markets begging for retail abuse?"