FX brokers a minefield

Unless the trader is using fx for hedging, I don't know why they'd speculate with fx.

IMO the ES contract offers far more than any fx market.
The ES contract is US regulated and traded on the CME's Globex Exchange in Chicago, USA, virtually instant fills, no spread on fills, rt commission per contract usually under $4.

some of the Stock Index Contracts:

Dow Jones $5 Mini YM CBOT/Globex $5 x Index Value H,M,U,Z. tick 1 / $5.00

. . . . . ES: E-mini S&P 500 Index ES CME/Globex $50 x Index Value H,M,U,Z. tick 0.25 / $12.50

E-mini NASDAQ 100 Index NQ CME/Globex $20 x Index Value H,M,U,Z. tick 0.25 / $5.00
Russell 2000 Index Mini ($50) RTY CME/Globex $50 x Index Value H,M,U,Z. tick 0.1 / $5.00


Day Trading Margins vary from broker to broker, usually $500 per contract, O/N is $5,800.

Most US Futures brokers also provide fx trading either thru their platform or MT4? 5.

AMP offers a gzillion platforms: http://www.ampfutures.com/

for the NinjaTrader platform: https://ninjatrader.com/Futures
 
I have absolutely no problems trading spot FX through a range of brokers - all outside the US fortunately! Heck, I even trade fully automated and multiple accounts per broker with no issues. I can scale up practically unlimited in FX and I will always have tons of liquidity available per pip level. I can be short the EURUSD with one system while long the EURUSD with another all in the same account - never a problem. I have a ton more flexibility for trading automated in FX versus futures.
 
By that same token you should never solicit clients to trade US stocks. Highly fragmented market without central order book. Just saying..

By the way a US futures traders credit risk is always the FCM not the exchange. If someone at the FCM steals my funds (regardless they are in a segregated account or not) and the firm goes under then no exchange nor regulator makes the client whole. Hence what's happening at the FCM is the primary source of credit risk to clients.


Robert Morse said:
I agree. FX futures provide one market place for price discovery and the CME will be your counterparty risk not a FCM.
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Why someone trades fx rather than punting stock index futures? Why don't you ask the participants in the 5.3 trillion DOLLAR Per DAY fx market, the largest market by far among any other asset class. Those individuals trade macro ideas. Views on political sentiment, regulatory changes, cash flows from mergers and acquisitions , they trade wars and any other information that impacts world markets and cash flows.

Wallace said:
Unless the trader is using fx for hedging, I don't know why they'd speculate with fx.

IMO the ES contract offers far more than any fx market.
The ES contract is US regulated and traded on the CME's Globex Exchange in Chicago, USA, virtually instant fills, no spread on fills, rt commission per contract usually under $4.

some of the Stock Index Contracts:

Dow Jones $5 Mini YM CBOT/Globex $5 x Index Value H,M,U,Z. tick 1 / $5.00

. . . . . ES: E-mini S&P 500 Index ES CME/Globex $50 x Index Value H,M,U,Z. tick 0.25 / $12.50

E-mini NASDAQ 100 Index NQ CME/Globex $20 x Index Value H,M,U,Z. tick 0.25 / $5.00
Russell 2000 Index Mini ($50) RTY CME/Globex $50 x Index Value H,M,U,Z. tick 0.1 / $5.00


Day Trading Margins vary from broker to broker, usually $500 per contract, O/N is $5,800.

Most US Futures brokers also provide fx trading either thru their platform or MT4? 5.

AMP offers a gzillion platforms: http://www.ampfutures.com/

for the NinjaTrader platform: https://ninjatrader.com/Futures
More...
 
GRULSTMRNN said:
Why someone trades fx rather than punting stock index futures? Why don't you ask the participants in the 5.3 trillion DOLLAR Per DAY fx market, the largest market by far among any other asset class. Those individuals trade macro ideas. Views on political sentiment, regulatory changes, cash flows from mergers and acquisitions , they trade wars and any other information that impacts world markets and cash flows.
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The only thing I trade is the Price going Up, or going Down.

None of the matters you refer to are of interest to me, nor having to keep track of what 195 countries are planning and doing with their combined 180 currencies.



The UK Financial Conduct Authority - as a last resort, provides £50,000 per person per firm for claims against 'Investment' firms declared in default.

Think there's a number of other countries with similar compensation plans.

Canada's 'Canadian Investor Protection Fund' provides:
"For an individual holding an account or accounts with a member firm, the limits on CIPF protection are generally as follows:
1. C$1 million for all general accounts combined (such as cash accounts, margin accounts and TFSAs), plus
2.C $1 million for all registered retirement accounts combined (such as RRSPs, RRIFs and LIFs), plus
3. C$1 million for all registered education savings plans (RESPs) combined where the client is the subscriber of the plan."
The CIPF was involved in the 'MF Global' fiasco:
https://www.elitetrader.com/et/threads/trustees-settle-over-mf-global-assets.255705/#post-3710453
and I have to wonder why the US still doesn't protect traders' funds.
 
"
I have to wonder why the US still doesn't protect traders' funds.
They do if it is Stock brokers not Futures.
Via SIPC I think $250,000
But yes UK is better becasue it protects Stock/ Futures/ OTC FX/CFD

Reg whether to trade FX or ES is an individual choice
If trading FX OTC FX is attractive becasue of huge leverage and small entry point but with that you take following risks ( so consider FX futures or FX ETF )
- No centralized exchange
- Many brokers are Market Maker not ECN so conflict of interest and avaerage jow would not know the diff!
- As mentioned above client funds may not enjoy protection as compared to Equity clients

Re g Futures FCM/ Exchange risk
The counter party is exchange not FCM so there is little counter party risk , however it is true that if FCM goes belly up your funds are not protected not is USA/ not in Australia , but in UK Yes,

SO in this debate lets bare open all factors not just cherry pick what suits one's risk appetite , can;t just say Margin FX is better because it provided huge leverage ( which in itself is double edged sword , even if the the broker is honest etc)

IN summary FX ETF via UK broker is perhaps safe
but the risk with ETF is the company managing the ETF can have fraud and although the underlying market has not gone against you the ETF itself can collapse, not sure if this has happened
 
So what in your opinion drives up and down moves? You can say "I do not care" but then you are simply reacting to prices that have already moved, you can of course bet on a trend continuation or on a reversal but trading is all about probabilities and if you can increase probabilities through analysis, reading and comprehension of news and their impact then you are ahead of the game. If you do not understand that then I can't explain further...good luck to you.

Wallace said:
The only thing I trade is the Price going Up, or going Down.

None of the matters you refer to are of interest to me, nor having to keep track of what 195 countries are planning and doing with their combined 180 currencies.



The UK Financial Conduct Authority - as a last resort, provides £50,000 per person per firm for claims against 'Investment' firms declared in default.

Think there's a number of other countries with similar compensation plans.

Canada's 'Canadian Investor Protection Fund' provides:
"For an individual holding an account or accounts with a member firm, the limits on CIPF protection are generally as follows:
1. C$1 million for all general accounts combined (such as cash accounts, margin accounts and TFSAs), plus
2.C $1 million for all registered retirement accounts combined (such as RRSPs, RRIFs and LIFs), plus
3. C$1 million for all registered education savings plans (RESPs) combined where the client is the subscriber of the plan."
The CIPF was involved in the 'MF Global' fiasco:
https://www.elitetrader.com/et/threads/trustees-settle-over-mf-global-assets.255705/#post-3710453
and I have to wonder why the US still doesn't protect traders' funds.
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