Please help me with CFH Clearing

[JSMITH07611]

please could anyone in the t2w community

i have been searching for information about cfh clearing. I was interested in trading with cfh although when i phoned them they said that i would need to be categorised as a proffessional trader because or mifid rules. Therefore i would need to fulfill two out of three points. either deposit 500000 euro or show them a certified document that i have a professional outlook on the market plus invest a minimum of 50000. I could probably manage with a bit of difficulty to get myself labeled as a professional trader. then there was another issue that they told me as I do not trade that often, rather do longer term trades that i would not be so profitable for them and they would not be so interested in me as a client.

therefore as i did wish to trade with them i was wandering if i could somehow join on to someone else's account or something of that nature.

One last point is the overnight swap/rollover is very important for me to know what it is if i hold my position overnight. I would probably prefer to trade on mt4 and if one right clicks on symbols properties one can see the rollover. I have tried a demo of their mt4 but unfortunately they have not updated the rollovers on mt4 so it is very outdated. so i was wandering if you could help me with this either by using teamviewer or a read only password or i could give you a few pairs and you could tell me the rollover.

the reason is that if the rollover is too expensive it will forfeit the gains and the advantage of using cfh and therefore i will save myself the great hassle of trying to open an account.

thank you very much for your help

kind regards

 

[itspossible]

 

[gc1]

Presumably, being classified as "professional" would give you less protection, e.g. if the firm went insolvent you would just be an unsecured creditor. Are the trading costs at one of these prime brokerage firms sufficiently less than retail outlets to make the extra risk worthwhile ?

 

[gerryg]

they said that i would need to be categorised as a proffessional trader

they told me as I do not trade that often, rather do longer term trades that i would not be so profitable for them and they would not be so interested in me as a client.

they have not updated the rollovers on mt4 so it is very outdated.

Maybe it'd better to find better broker?

 

[Hedge Fund Wizard]

Alternatives to CFH

please could anyone in the t2w community

i have been searching for information about cfh clearing. I was interested in trading with cfh although when i phoned them they said that i would need to be categorised as a proffessional trader because or mifid rules. Therefore i would need to fulfill two out of three points. either deposit 500000 euro or show them a certified document that i have a professional outlook on the market plus invest a minimum of 50000. I could probably manage with a bit of difficulty to get myself labeled as a professional trader. then there was another issue that they told me as I do not trade that often, rather do longer term trades that i would not be so profitable for them and they would not be so interested in me as a client.

therefore as i did wish to trade with them i was wandering if i could somehow join on to someone else's account or something of that nature.

One last point is the overnight swap/rollover is very important for me to know what it is if i hold my position overnight. I would probably prefer to trade on mt4 and if one right clicks on symbols properties one can see the rollover. I have tried a demo of their mt4 but unfortunately they have not updated the rollovers on mt4 so it is very outdated. so i was wandering if you could help me with this either by using teamviewer or a read only password or i could give you a few pairs and you could tell me the rollover.

the reason is that if the rollover is too expensive it will forfeit the gains and the advantage of using cfh and therefore i will save myself the great hassle of trying to open an account.

thank you very much for your help

kind regards

There are many better brokers if you are looking for Professional brokers that won't "B Book" your trades (trade against you).

CFH seems to have gone a bit down hill, especially with the MT4 based bookie offering.

I'd recommend either CapMar Financial (min £50k but can be negotiated down to £20kish) or LMAX (min £10k, but can be even less through an instituting broker). Sucden Financial are also good but with a £50-100k min.

LMAX are good, but they may (or may not-hard to be sure) B book your trade, as in their Trading Agreement they state that they take the other side of your trade, but then replicate it with their liquidity providers instantaneously (milli-seconds), indicating they don't take on any risk. This means that their is no post trade transparency, as you are not a direct counter party to the opposite side of the trade that has taken place in the inter-bank market, so you won't know who takes the other side (which can be very important over the long term).

 

[Hedge Fund Wizard]

Maybe it'd better to find better broker?

If you are classified as a "professional" all it means is that you will have no recourse to the Financial Ombudsman (reading about all the retail investors getting periodically screwed, not sure it's any good anyway) service in the case of a dispute arising and if I remember correctly, you will also forfeit your entitlement to the FSCS (compensation protection). You still qualify for the other projections of an FCA regulated brokerage (which doesn't mean much these days).

LMAX is the only professional broker that I know, that still classifies the customers that use their "LMAX Professional" platform, as "retail", which can give you that extra piece of mind (should you seek it). With the added benefit of trading at interbank prices with no re-quotes (which if you are an active trader-will know can be the difference between being up £20k for the month or down £12k.

 

[Hedge Fund Wizard]

Yes and. No.

Presumably, being classified as "professional" would give you less protection, e.g. if the firm went insolvent you would just be an unsecured creditor. Are the trading costs at one of these prime brokerage firms sufficiently less than retail outlets to make the extra risk worthwhile ?

You don't trade with a professional broker (one that doesn't B-book) for costs. You do it because you know that you are getting a "real" market price when trading and that the broker isn't taking the other side of your trade (I.e. Your loss is his gain-so he will do whatever he can, to ensure you lose).

The costs are slightly immaterial, as this is a slightly more complex issue than it may otherwise appear. Prima facie, a broker that offers a 0.2 pip spread on say EURUSD may appear to be half as cheap than one that offers 0.4 pip spread. However, if the price is skewed I.e. 1-3 pips off of the actual interbank market price at the time, then the spread is immaterial. Likewise, the spreads offered by most (if not all) retail brokers, will have a mark up included, whichever they will increase when it suits them and they are in a trade with you that is going against them, meaning they are making money of of you in more ways than one.

Real brokers (usually only available with min £50k accounts) make their money only from commissions. Therefore if you can not give them reasonable assurances of average monthly volumes of at least (bare minimum) £50-£100Mio a month, they see no benefit to adding you to their client base. They prefer traders with volumes as opposed to investors.

A good sign that you are in your way, is a broker that offers the Currenex platform. This is an institutional platform and although the feeds can still be manipulated (brokers can add a spread premium to your feed), it helps whittle them down. MT4 is a horrible example of the possibilities of Broker manipulation and is a retail platform that is not recommended. You can google MT4 to find out all the ways brokers an manipulate the feed etc and it is even included in MT4s own Corporate White Labelling sales literature, as a selling point.

So a pro broker may cost you a few dollars more per million, but you get what you pay for. No point in saving a $ to lose 10.

Also, on low volumes, pro commissions with reputable brokers start at around £25Mio and can be as low as $10Mio with volumes in excess of $1Bio/mo (Billion per month).

This is of course my humble, but I hope slightly informed opinion. Others may wish to differ.

 

[JSMITH07611]

thank you for all your replies and your help. i still am weighing the options

 

[Abeer Saba]

hi JSMITH07611,

i have a friend who works with them, i have applied account myself back then but decided to go to other brokers when i found out that the terms of trading with them wasn't suitable to my strategy of trading .

being said that i would not recommend you to share an account not even with your friend its enough to say that your strategy may not be suitable for the account holder you always want to be independent in this field its the golden goal .

regards the swap/rollover have you asked the account manager or the sale responsive about it ? usually they offer a solutions to suit your strategy of trading if it didn't gotten against their terms, if you did so & you haven't found a working solution regards that then going to search for better brokers would be a good option, a broker have the requirements to your trading strategy .


if you have any questions i will be happy to help, Good Luck !!