Unregulated vs Regulated brokers

[pipeguy]

Црф

Indeed, exactly so.

There are reasons that in the murky world of retail spot forex-trading the counterparty market-makers who are pretending to be "brokers" sometimes choose to be regulated in jurisdictions like Vanuatu, the Seychelles and Cyprus ... and to put it mildly, they're not reasons that are in their customers' interests.

You find out how "good" your broker is only when something goes wrong.

Where and by whom they're regulated is about the single most important consideration behind the issue of selecting a broker.

I don't understand what's the problem if your broker makes market for you. After all somebody should lose on the other side if you win. Other LPs will try as well to offer conditions unadvantageous for traders, so I still see no difference LP or your broker..

 

[Xela]

I don't understand what's the problem if your broker makes market for you. After all somebody should lose on the other side if you win.

And should win when you lose. Do you want that "somebody" to be the same party who controls the prices, holds all your deposited funds, and also makes up and interprets all the rules governing the transactions, or might it be preferable for the "somebody" to be a random and anonymous stranger, without your "broker" having any incentive for you to lose?

For many traders, it's not a very difficult question. Some might even regard it as a "no-brainer". But your own answer to it is up to you, of course.

 

[Babaha]

The fact that the broker is "regulated" does not give any additional protection to the trader. "Regulator", means that the broker pays contributions to be in the membership of а regulator. If the broker is not a deceiver, then it will work honestly even without regulation.

 

[Xela]

The fact that the broker is "regulated" does not give any additional protection to the trader.

A widespread myth. It's just factually incorrect: for example, using a broker that's FCA-regulated in the UK - regardless of the customer's location - provides a £50,000 government-backed guarantee against various eventualities (including the broker's insolvency, as many customers of Alpari-UK discovered, to their great relief, not so long ago ... that sounds very much like "additional protection", doesn't it?).

There are other examples, too, illustrating the importance of good regulation.

There are reasons why some brokers choose either to be unregulated or to be "regulated" in the Seychelles, Vanuatu or the Caribbean, and to put it mildly, they're not reasons designed for the protection of their customers.

 

[CSEtrader]

A widespread myth. It's just factually incorrect: for example, using a broker that's FCA-regulated in the UK - regardless of the customer's location - provides a £50,000 government-backed guarantee against various eventualities (including the broker's insolvency, as many customers of Alpari-UK discovered, to their great relief, not so long ago ... that sounds very much like "additional protection", doesn't it?).

There are other examples, too, illustrating the importance of good regulation.

There are reasons why some brokers choose either to be unregulated or to be "regulated" in the Seychelles, Vanuatu or the Caribbean, and to put it mildly, they're not reasons designed for the protection of their customers.

Our story is another example of why for instance, some big banks are choosing to open off-shore location and treat their clients as we were here in the Bahamas. And the same was in Switzerland towards client from behind the Iron Curtains. Our full story of horror is here https://letsmaketheworldfairer.wordpress.com/ , hope you may take a look or on my thread on ET [trading couple for 3 years are harassed by UBS Bahamas, your help will bring victory started on 19 April 2018]
, were so many has barked at me but true and wise has signed in.
To summarize - regulation is a strong good foundation for traders rights to be respected, execution goes to the exchanges and not finishing up in the bank's clerks tables, feeding white-colors criminals. for the past 9 years, we are in was and are still determined to bring it to the courts and so to the victory. The victory is almost guaranteed because of the existence of the regulations.

 

[pipeguy]

And should win when you lose. Do you want that "somebody" to be the same party who controls the prices, holds all your deposited funds, and also makes up and interprets all the rules governing the transactions, or might it be preferable for the "somebody" to be a random and anonymous stranger, without your "broker" having any incentive for you to lose?

For many traders, it's not a very difficult question. Some might even regard it as a "no-brainer". But your own answer to it is up to you, of course.

Of course somebody who does that. At least I can point a finger to somebody if something bad happens. When the somebody doesn't exist in case of decentralized system who will be guilty if you take loss?
Responsibility matters more that restrictions you are bound to. That's why we have government, not anarchy, because losing something in the order is always less than losing something in the chaos

 

[CSEtrader]

Of course somebody who does that. At least I can point a finger at somebody if something bad happens. When that somebody doesn't exist in case of a decentralized system who will be guilty if you take a loss?
Responsibility matters more than the restrictions you are bound to. That's why we have government, not anarchy, because losing something in the order is always less than losing something in chaos

Anarchy is not chaos, but an absence of bureaucratic structures dependant on your pocket and forcing you to agree with any mediocre decision they may undertake [

.
The responsibility for loses is totally on us, while the responsibility for bad advice and bad execution is totally on the service providers.
To enforce the law and regulations to respect our rights as traders is our duty and aim.
Governments are of little help, sadly they mostly consist of 9 to 5 mentality operators, and little regard for the impact their occupation has on society. No risk or responsibility, we are two planets on different orbits.
I welcome you to our website, just to have an idea where dishonest service providers, some of the most powerful in the industry, may harras you if the law and regulations are not enforced.
To conclude - unregulated brokers are an obvious disaster, while even regulated are doing what they do in the jurisdiction where they feel not to be properly supervised. Again - they are 9 to 5 mentality persons and we are the tribe of free beings.

 

[pipeguy]

Anarchy is not chaos, but an absence of bureaucratic structures dependant on your pocket and forcing you to agree with any mediocre decision they may undertake [

.
The responsibility for loses is totally on us, while the responsibility for bad advice and bad execution is totally on the service providers.
To enforce the law and regulations to respect our rights as traders is our duty and aim.
Governments are of little help, sadly they mostly consist of 9 to 5 mentality operators, and little regard for the impact their occupation has on society. No risk or responsibility, we are two planets on different orbits.
I welcome you to our website, just to have an idea where dishonest service providers, some of the most powerful in the industry, may harras you if the law and regulations are not enforced.
To conclude - unregulated brokers are an obvious disaster, while even regulated are doing what they do in the jurisdiction where they feel not to be properly supervised. Again - they are 9 to 5 mentality persons and we are the tribe of free beings.

When you take decision, as a rational indivudual you should always maximize your own utility. But your interests can cross mine - who gonna be the judge? You or me? There comes the need for arbitrage. To maximize social welfare we have to delegate some functions and resources to the unique body which have: unlimited horizon of planning, subject to formal rules where no individual identity can be tracked.

It's called government. Bad government doesn't mean government doesn't work at all. Learn history we have this taken out not of thin air but thousands years of evolution. Who are you to judge what we need and what we don't need? A human who will live 60-70 years, who need to take care on your own family? We are all cockroaches trying to voice our opinions but some of them are definitely too loud