FxPro Discussion

This is a discussion on FxPro Discussion within the Forex Brokers forums, part of the Commercial category; Dear Traders, We are creating this new thread to answer your questions that you might have, and post here important ...

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Old Feb 3, 2015, 4:39pm   #1
 
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FxPro Discussion

Dear Traders,

We are creating this new thread to answer your questions that you might have, and post here important announcements by FxPro. Feel free to get in touch with us here.

Kind regards,

FxPro Team
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Old Feb 9, 2015, 7:48pm   #2
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this "negative balance protection" thing

what about futures (CFDs)?
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Old Feb 10, 2015, 11:55am   #3
 
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Originally Posted by kalott View Post
this "negative balance protection" thing

what about futures (CFDs)?
Dear Kalott,

Thank you for your question.

The Negative Balance Protection applies to all of the products offered by FxPro.

Kind Regards,

FxPro Team
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Old Feb 10, 2015, 3:30pm   #4
 
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1. I assume client money is separately held in reputable banks, somewhere other than Greece, Nigeria etc. ? If so where ?
2. Is it an ecn system ?
3. Do you do micro-lots ?

I await your answer
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Old Feb 10, 2015, 4:40pm   #5
 
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Originally Posted by Pat494 View Post
1. I assume client money is separately held in reputable banks, somewhere other than Greece, Nigeria etc. ? If so where ?
2. Is it an ecn system ?
3. Do you do micro-lots ?

I await your answer
Dear Pat494,

Thank you for your questions. Please see the answers below:

1. The clients' funds are held in segregated accounts from the company's funds in the following banks: RBS (Royal Bank of Scotland), Credit Suisse and Barclays.
2. For more information on our model of execution, please follow this link: http://www.fxpro.co.uk/trading
3. We do provide micro lots.

Shall you have any more questions, please do not hesitate to contact us.

Kind regards,

FxPro Team

Last edited by Sharky; Feb 12, 2015 at 4:07pm. Reason: Added back link
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Old Feb 10, 2015, 5:21pm   #6
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Do FxPro have contingency plans to relocate from Cyprus when Greece leaves the Euro ?
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Old Feb 10, 2015, 5:47pm   #7
 
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Originally Posted by counter_violent View Post
Do FxPro have contingency plans to relocate from Cyprus when Greece leaves the Euro ?
Dear Counter_Violent,

Thank you for your questions.

1. FxPro has two entities: regulated by the FCA in the UK (FxPro UK, the headquarters, registration number 509956), and by CySEC in Cyprus (FxPro Financial Services Ltd., licence number 078/07).
2. Cyprus is an independent republic, and whether Greece leaves the European Union or not, it is irrelevant to the country.

I hope the above answered your questions. Shall you have any more questions, please do not hesitate to contact us.

Kind regards,

FxPro Team
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Old Feb 11, 2015, 11:41am   #8
 
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Why Negative Balance Protection is so Important

FxPro Group started this thread Dear Members,

I would like to present to you the thoughts of the Founder and Chairman of FxPro, Mr. Denis Sukhotin, on the importance of Negative Balance Protection.

Why Negative Balance Protection is so Important

The recent CHF debacle has been quite instructive for a number of reasons. We all agree that low volatility is a bad thing in retail forex, but too much of it can be catastrophic. However, itís precisely when the markets stray from that comfortable middle ground that we get a unique insight as to whoís who in this industry. The confusing acronyms and contradictory marketing copy fall away and we see brokers through their actions. This is exactly what happened in January when the SNB removed its 1.20 floor.

Many market-making brokers not only appear to have been unaffected by the unprecedented EUR/CHF move, but also seem to have done quite nicely out of it by passing on huge amounts of negative slippage to their clients, proving once and for all that their interests are diametrically opposed to those of their clients.

But aside from this we also learned that itís not as clear-cut as market makers vs agency brokers. The hot topic since January 15 has been that of negative balance protection, or lack thereof. So, not only do we have a subset of brokers who remain completely insulated from the market by keeping their clientsí orders on their own books and profiting from their losses, we also have agency brokers pursuing their clients for negative balances when the market stress-tests their business model. The result? Thanks to the actions of a number of brokers the entire industry comes out of this black swan event looking bad.

At FxPro negative balance protection has never been something that you just put on your website in order to reassure newcomers. For us itís a guarantee that you as a broker are sufficiently well capitalised and have all the relevant risk management protocols in place to weather any storm. Itís a watermark of professionalism and credibility that must be honoured, no-matter how steep the cost.

When the news of certain brokersí insolvencies was followed by announcements that several had already begun pursuing their clients for negative balances, the scene became reminiscent of the Ďtoo big to failí banks during the 2008 crisis, that bankrupted themselves and then demanded for taxpayers to bail them out. Itís hilarious how we love the free market while weíre benefitting from it, but want a safety net when it turns around and bites us.

Itís absolutely outrageous for brokers that profited from the trading of their clients for so many years, to now resort to hounding them for these negative balances. When your clients routinely blow up their accounts are you expected to refund them? Why, then, are you now attempting to have them cover what are essentially your own losses? If their margin calls are their own responsibility then, surely, you too are responsible for yours.

This ridiculous idea of private profits and public losses is perhaps one of the most venal aspects of our current economic system and it breeds a sense of contempt in the general public, who are usually left to foot the bill. We as an industry could have come out of this event united and honourable, rather than some of us trying to climb back up on the backs of our clients.

The fact remains that if you are offering highly leveraged products that can amplify losses as readily as they do gains, you ought to build some protections in, so that if the market moves against your clients they donít end up losing more than they initially invested, even if youíre not strictly obliged to. Itís a complete no-brainer. By reneging on that commitment, or not offering it in the first place, not only do you lose the confidence of traders, but you also give the industry a bad name.
We as FxPro have made our position clear. Our negative balance protection policy stands. We will continue to ensure that clients do not have to contend with losses that exceed their invested capital.

You see, this is more than just an issue of differing company policies. Itís an essential aspect of the services we offer. When you remove that safeguard or throw it into question you fundamentally alter the relationship that we as brokers have with our clients. We are not debt collectors. The onus is on us to ensure that we can offer trading facilities in a variety of market conditions, without going after our clients when itís us that has to take a loss. If we are unable to do so, then there is obviously a deeper problem at work, and perhaps some of us should consider switching to a different industry.
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