Hi guys,
I intend to open an automated account with AAAFX company supported by ZuluTrades.com because it is the highest in execution speed with Zulu - as Zulu state in their website - does any one know the pros and cons of this company ?
and why is not it stated in the Reviews and Ratings list of ForexPeaceArmy?
I've been shopping around for a broker as well. Here is what I've learned so far:
* posts by aaafx sales staff say they are "regulated by mifid". this is incorrect, as mifid is an EU law, not an enforcement body (not a regulator).
* they are in greece, and their website states "Regulated as an FCM in Europe (id 2/540/17.2.2010)". I find this highly suspicious because of the wording they carefully chose. regulated "as an fcm", and not "by the "fcm", could mean that they are using fcm as an abbreviation for something else. They don't actually say that they are regulated
by the FCM! The given ID number seems a little short... I'd have to check it out (if you strip out the date, you are left with 2, 540. 540 is rather short, for a registration number, wouldn't you think? unless the FCM, wherever that is, uses numbers incorporating the date).
* I started going through the steps of opening an account, and followed the link to upload funds via paypal. It said paypal is down. I chatted with their online support. I didn't know of a way to ask if paypal banned them, or if it is just a temporary glitch for the day, so I asked "for how long has it been down?", and the answer: "three weeks". it may be more, of course, but this tells me that paypal isn't going to get them up and running anytime soon. coding for paypal is silly-simple! it's a link, redirects you, then redirects you back to the original website. so there is no coding in their system that would prevent it from functioning. this is not reassuring.
The pros for this broker, is that they, along with hotforex, have consistently the lowest slippage, when I look at the varous traders' statistics on Zulutrade (the ones you can follow - not sure what they are called, but they give you their performance and the stats - look at their graph, click on the tab "slippage", and you'll see all the brokers that their trades were mirrored through by followers, and the slippage that occurred on average).
But the cons are, that they are hiding at least one of the following: who are they really regulated by (if anyone)?, if actually by the FCM what is their real regulated broker number?, and why has paypal cut them off.
regarding paypal: In all fairness, there may have been some disgruntled traders who filed paypal claims, disputing their initial fund transfers, and whether they are wrong or right, if you have too many claims, paypal investigates and potentially suspends or terminates you. the paypal thing might be an indication of something amiss, but it may also not be a big deal - but keep in mind that there are SOME brokers out there that offer paypal funding and have not been suspended/terminated, although we don't know for how long they have been offering it. and btw, a fee for using paypal is OK in my book, because somewhere, to someone, paypal will charge a fee, and paypal charges a high percentage for any currency rate conversions which isn't in the rates we are used to(!).
Hope that helps.
PS: I mentioned hotforex, but I can't comment just yet - I tried to open an account, but they didn't accept my provincial photo ID and I have to get my passport renewed before they accept me. in the meantime, I'm still shopping around, but I might come back to those guys, as their website is more forthcoming with information about them, and they, along with aaafx, have consistently the lowest slippage. I'm not endorsing them though, because as I said, I don't know.
Info on other brokers:
I'm in North-America (Canada), so some brokers I've eliminated because they offer only 50:1 leverage, or because they don't accept customers from North-America (IBFX). If I was satisfied with 50:1 leverage, one of those firms would surely be my best bet, because my deposits would be insured and the regulatory bodies here have teeth.
Dukascopy is a swiss bank and definitely solid and reputable, with low slippage, but they charge a commission of $35/million$, which translates to 35 pips! FXTM charges $20/$1,000,000 meaning 20 pips - still not competitive. I think they just use that to discourage frequent traders from signing up.
I'm slowly going through the list of brokers with which Zulutrade integrates with. This is because I want at least one zulutrade account, and one where I trade myself. some of the guys on zulutrade have made percentage gains in the four digits, and I want to be part of that.
I haven't been through the list yet, so I can't give you a summary of them all.
But I can tell you the list of
questions I have come up with,
to ask online chat if I don't see the answers on their website:
1. what regulatory body are they regulated with? (where, registration number)
2. how are orders fulfilled? (dealer desk, are they the market maker, or is it ECN? and you can read reviews here to uncover some that claim to use ECN but may actually be a market maker).
3. do they make money off the spread, commissions, or a combination of both?
4. what are their spreads? (identify a few pairs and use them as reference to compare different brokers)
5. what is their commission?
6. what leverage are they offering? (and up to what amount at that leverage? - many will cut that leverage in half if your account exceeds $2k for example)
7. what is the minimum $ to open an account? (I'm poor, so I care)
8. check if they offer the MetaTrader platform (or Swordfish or whichever you want)
so they support zulutrade and offer direct zulutrade integration (skip this if not applicable)
Please everyone -before descending on the chat agents with this list,
check their website first!
My take on where they are regulated: if it is in Cyprus, Russia, New Zealand, Mauritius, I would ask "why there and nowhere else?". They choose where to open offices and be regulated. Just as companies look at cost of labor, taxes, fuel, electricity, stability, etc, brokers definitely look at where they want to comply to regulators (or not). Some regulators don't have teeth (for whatever reason - either because they are underfunded or under staffed, or the local laws don't punish criminals as harshly or any number of other reasons). Cyprus has one of the highest ratios of brokers per population density of any country in the world - there has got to be reasons for that. If they are only regulated in NZ, but not in neighboring AU, I ask myself why. And with all the corruption in Russia (have you seen the recent investigative documentary "Putin's Road to Sochi"? their whole system is rotten from head to core, with funds siphoned off in the billions(!!!) to corrupt government and officials). So I wouldn't feel safe with alpari.ru for example, as it is the only alpari option for Canada and US customers (besides, those accounts are in rubles), although alpari.co.uk is available to the rest of the world (they do have among the highest slippage though and double that of alpari.ru).
The bank are privately holded, so whatever happens or the Gov goes through, your money are safe
