Best retail broker, go with FXCM.
Oh, my goodness. Did they pay you to say that?
Why ask why?
Los Angeles Times: Forex Currency Broker FXCM Hit With $2 Million Fine.
Just for starters.
1] NYSE listing and Ernst & Young auditing
*promotes transparency and accountability in terms of organisations financial health,
and trade environment (feed, spreads, fills etc) for traders
*remember, CFTC and NFA fines relate to activities conducted prior to public listing
AIG Trading Group, Inc., was also NYSE listed, yet it was hit with an Antitrust Civil Action by the United States Government:
AIG Trading Corporation; Defendant, etal.
If being a publicly traded company meant no more unethical business dealings, then we would live in quite a different world than the one that exists right now. So, such statements are fluffy comfort food for the mind bent on getting itself into trouble, at the very least - in the Retail FX world.
2] CFTC and NFA fine FXCM
*fines force transparency and integrity in price feed and trade order execution
Wow! That had such PR brio!
Fines force
unethical business practice behavior to the surface and they prove beyond a shadow of any doubt that certain business entities believe that they are above the law and/or have no responsibility to play by the rules.
Getting fined means that you broke the rules. Getting sued in court, means that the plaintiff's claim is that you broke the law. Neither one of those things going to force more transparency, unless they are accompanied by Governmental follow through in the form of tighter regulatory controls. Have we seen that in Retail Bucket Shop Land? No, we have not.
What have we seen instead? Instead, government has places tighter restrictions on the Retail Trader, not the Retail Bucket Shops, like FXCM and many countless others.
3] Trading Station is one of the better retail forex platforms and it’s free
Better at what? Oh, here's a well know FXCM Trading Station II Platform list of foibles:
- Freezing just before a news release
- Freezing just after a new release
- Perpetually disconnecting and forcing a restart
- Remaining connected by failing to update Core Pricing
- Core Pricing lagging behind competitor Core Pricing
- Sloppy fills, virtually always adverse to the Trader's position
- Spreads that are typically 100% to as much as 600% higher than the competition
4] good spreads as an active trader or off the dealing desk
*don’t get your knickers in a knot,
read FXCM’s definition of a dealing desk first
There absolutely no such thing as "No Dealing Desk," in ALL of Retail Forex. It is not possible. They do not take your order to Interbank - period. None of the Bucket Shops do that. They do not have the requisite banking relationships and they are not true Forex Brokers.
If they were true Forex Brokers, then they would offer you TRUE Interbank Liquidity, TRUE Interbank Spreads, TRUE Interbank Execution, TRUE Interbank Fills and they would charge you a Commission for using their platform - period.
Instead, their very own business model by definition means that they must charge you by manipulating the Spread, which does not even come off the real Interbank market rate stream. The stream comes from their own proprietary liquidity pool, not REAL Interbank Prices. Your trade never sees the light of day on the real Interbank, when you trade through a Bucket Shop like FXCM and the countless others out there posing as real Interbank Intermediaries.
Their "Dealing Desk" is now an
Electronic Dealing Desk where the spreads you pay and the fills you get, are all algorithmically manipulated by their back-end server, before the prices arrive on your desktop. That is what their pricing engine algorithm does - it is a revenue generator for them. So, the more than can put your position at a disadvantage the more revenue they make.
Saying that you get "No Dealing Desk" access into a Private Liquidity Pool for execution, is like saying get a Public Defender to argue your case against the full weight of the District Attorney's Office upon entering court.
It is a joke.
5] 200:1 margin
*for most traders higher margin increases risk, for me it decreases risk
For most Nubes, 200:1 is total suicide! If you miss the exit ramp on a Swing Trade, you can kiss your account goodbye. If you day trade at 200:1 and you are not trading with high accuracy to a very specified target, then you can expect your Stops bleed out your account.
You have to be either a very accurate Day Trader, a Swing Trader with lots of time on their hands when things go wrong, or a Scalper who understands how and where they should place their order for maximum momentum follow through. And, your Cost Basis per trade needs to be extremely low - or you had better really know what you are doing with higher CB risk.
Using 200:1 as a reason to trade with a Bucket Shop like FXCM and all the others, is really telling.
6] excellent customer service
I rate their Customer Service at 6 out of 10. Nothing special and certainly nothing excellent.
7] there are successful traders using them,
here is just one
Successful Trader has many definitions. Mine would be the ability of that Trader to get off of Retail Bucket Shop Trading Platforms of all kinds, and to move on to an Institutional Trading Platform, either in a direct relationship with a Bank, or through a Prime Broker relationship which often times is more beneficial to the individual trader having just set-up an LLC, LLP, or a Corporation for the purpose of managing their own proprietary fund.
Success in trading is really all about how you define it. The Cost Basis per trade limitations on Bucket Shop platforms such as FXCM, Oanda, MB Trading, FXDD, etc., will not allow some Traders to trade at the size they need to be successful. So, an Institutional platform is their only viable option.
In Retail FX, is you live in the United States of America, you now have only one real serious option and that is
CitiFX.
I used to put Interactive Brokers into that short list, but they just got hit with a $700,000 fine for not handling their back-office correctly. It did not impact the Retail Trader, but it shows that these Retail Firms like to play fast and loose with the rules.
CitiFX, is a real bank with a real Bank Charter and a real Federal Regulatory Environment in which they most operate. If you move up to their more "Institutional" like sizing levels, then you will see much better spreads on their trading platform, which put them far and away ahead of Bucket Shops like FXCM and the rest.
The Cons are that they still use SAXO Trader, which is a TANK of a Trading Platform. However, they do offer MT4 - unfortunately, the last time I checked, it went through the Boston Technologies MT4 Bridge, but I hear through the grapevine that CitiFX, will be going with their own MT4 solution soon.
If you live inside the U.S., do you really have any other choice, if you desire is to avoid a Bucket Shop? The answer is no.
If you live outside the U.S., then you have DCFX and their awesome Currenex Hub. The have just added cTrader and they have their own stand-alone MT4 solution receiving Currenex Hub liquidity. They also have no problem in Publishing their Liquidity Pool Partners, which is what REAL transparency looks like. FXCM, refuses to publish their Liquidity Partners, which tells me that they are attempting to hide something.
LCG (London Capital Group), might also be another option for some. They offer genuine Institutional Trading Platforms, though I am not 100% that you still cannot open a Retail "like" account with them. Call and ask.
There are NOT many good places in the world to trade Forex right now at the Retail level - period.
