CALL TO ACTION: CFTC 10:1 - Share what you wrote here

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To: secretary@CFTC

Dear Secretary,

About four years ago, I had a decent size retail forex account with Refco FX, maybe about 35K or so; all my eggs were in one basket.

Refco Fx went bust and I settled for about 21 cents on the dollar; not a pretty picture.

Today, I have four separate small FX accounts with different brokers; I never let any one these account grow above 12K.

Instead, I skim profits when needed for income and savings. This is how I distribute my "rogue broker" risk; multiple accounts with anywhere from 100:1 to 100:2.5 leverage.

This high leverage allows me to maintain and trade these multiple accounts with relatively low balances. I never exceed usage 10% account equity for any one trade, and risk no more 1-2% loss for any trade.

This is how I manage trade risk and broker risk. I keep the risk small and spread it around. 1-2% leverage is essential for such a program.

By reducing margin, funds become consolidated into fewer larger accounts, into fewer larger brokers and into fewer larger banks, until there are only a few big players left to distribute risk.

Eventually, too big to FAIL will become too big to BAIL!

I subsist on small accounts and managed leverage; the risk is to me and my small accounts, Not the entire financial system.

Sincerely,

Kelly Goodman
 
monitor the broker, protect the trader

a leverage of 10:1 would mean the end of retail forex. it would push back forex into the middle age of foreign exchange - a time when only banks or large scale investors could afford it.
in the sense that not the decisions of forex traders need to be guarded, but their assets, i make the following proposal:

ease the way how a trader can access his assets in case of insolvence of the broker. create additional funds.
we all know that monitoring is necessary because of a large number of fraudulent cases.
improve the monitoring of the brokers.

please the trader, rule the broker.
the trader is the one who brings all the money into the game. without traders there would not be the large retail market as we know it today.
 
My message to CFTC

Hi FPA members

Here is the message I emailed to the CFTC a couple of days ago.

I recommend you all do some thinking about this, and try to come up with your own versions of why the status quo should be preserved.

Ivan

____________________

Dear Secretary CFTC

I am concerned that the proposal to limit the use of leverage to 10:1 will severely reduce the ability to continue to profit from Retail Currency Trading.

I would rather see Retail Forex companies commit a portion of their assets to ensure potential traders can prove they have the understanding required to trade using leverage of 100:1 and so on.

I think the onus should be on the trader, not the Regulator, to show that they are competent to handle the risks.

Here in Australia, the Commonwealth Bank Trading Arm, "Commsec" requires traders to prove that they understand the terminology and the mechanisms of trading before using their trading platform. The test is rigid, and requires traders to do research before answering the questionnaire.

Further, Commsec requires another test before it allows traders to use and set Stop Loss orders.

That is not difficult, and it works.

The onus is on the traders, and the benefit of this is that traders actually become better traders through studying for the test.

Rather than pursue an expensive regulatory pathway, which would require policing, why nor help traders to improve their skills, and require Retail Forex companies to require proof of their ability to handle the risk involved in the use of higher leverage?

This would protect the new traders who jump into these markets to get rich quickly, as well as preserve the ability of more experienced traders to continue to profit as they currently do.

I think my suggestion may put the responsibility back onto Retail Forex as well as clients, and allow the Regulator to continue in the role of overseeing fair trading.

Yours faithfully

Ivan **

Australia
 
Less revenue from Taxpayers

Mr Secretary



i am writing about the 1:10 leverage.

this is a very bad idea. i will move my account to an offshore forex broker. it will cost jobs.

also less leverage means less profit, and less income from us Taxpayers.

Please don't kill the retail forex here in the USA



sincerely

kkisded
 
This one's from forex traders daily: CFTC Proposes Oppressive Forex rule - Take Actio

Dear Fahd,

As you may or may not be aware off, at the end of last week the CFTC released a proposed rule that would affect your Retail Forex Broker and your trading ability.

The CFTC proposal, made public on Thursday, came out with a big headline rule as a leverage restriction across the board to 10 to 1 leverage. This is a rule proposal not law yet but if it become law, your leverage will go from 100:1 or better DOWN to 10:1. This means you would now need $1000 to trade one mini lot or $10,000 to trade one standard lot.

I can not find better words to describe my position on all this than those of Andrei Pehar, Chief Currency Strategist at fxKnight.

Andrei says: "I am not opposed to regulation nor regulatory agencies. But that regulation needs to be fair, transparent, and open to public input. Otherwise it becomes corrupt and self-serving. Sure high leverage can get you into trouble if used thoughtlessly. Sure hedging when not done properly turns one loss into two. But I believe the cure is EDUCATION, not restricting what people can and cannot do with their investment decisions. Guide, don't dominate - government was invented to protect people and their property, not to limit their potential."

TAKE ACTION!

We at ForexTradersDaily.com STRONGLY disagree with the CFTC proposal. If you disagree as well, you may submit your comments to secretary@www.cftc.gov. Make your trading voice heard on this matter!

Include "Regulation of Retail Forex" in the subject line of the message and the identification number RIN 3038-AC61 in the body of the message.

Also, with the identification number RIN 3038-AC61, you can submit your comments by any of the following methods:

* Fax: (202) 418-5521.

* Mail: Send to David Stawick, Secretary, Commodity Futures Trading Commission, 1155 21st Street, N.W., Washington, DC 20581.

* Courier: Same as Mail above.

All comments received will be posted without change to U.S. Commodity Futures Trading Commission, including any personal information provided.

Please, help us to spread the word!

I think this is a very important matter that affects us all and that we should try our hardest to ensure that things will be done for the best of the trading community.

Thanks for your help!

Dedicated to Your Trading Success,
 
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Regulation of Retail Forex : Outrageous!!!

RIN 3038-AC61

Dear Sir,

The proposed regulations for retail forex are outrageous. As a forex trader, I feel that it will have detrimental consequences for all the traders involved with forex trading in USA.

We are all grown-ups and very well know our boundaries and limitations and if somebody decides to cross it, well than its his or her own personal choice. We live in a free world and get to choose whatever we find suitable for our growth. Lowering the leverage to 1:10 on the pretext of giving security to our funds is unjustified.

If somebody wants to commit suicide with his funds, well its his choice. We all take risks everyday and own our decisions since we find them necessary to attain certain goals. Crossing a road can be risky too but this does not mean that the Transportation Secretary should ban all the cars!!!

I hope that you will withdraw these outrageous terms and respect the personal decisions and judgment of others.
Thank you

A concerned forex trader
 
Message from IBFX

Dear Valued Customer,
As many of you are aware, the U.S. Commodity Futures Trading Commission (CFTC) announced on January 13, 2010 that it is seeking public comment on proposed regulations concerning retail Forex trading.
As part of the proposed regulations, it is stated: "leverage in retail forex customer accounts would be subject to a 10-to-1 limitation," which means 10:1 leverage would be the maximum amount allowed for all Forex traders in the U.S.
An example of how the proposed regulatory restrictions would affect a major currency pair appears below:
Maximum Leverage under
Current Regulations Maximum Leverage under
Proposed CFTC Changes
USD/CHF USD/CHF
100:1 leverage (one percent) 10:1 leverage (10 percent)
1 lot (100,000) 1 lot (100,000)
Margin requirement: $1,000 Margin requirement: $10,000
We stand behind the belief that you should be given the freedom and right to choose the amount of leverage that is appropriate for your individual desired risk, and that this basic principle of 'choice' is in jeopardy by the proposed CFTC regulations.
If you should you feel strongly about the proposal, we encourage you to help determine the outcome of these proposed regulations. You can help make an impact by sending comments directly to the CFTC at: secretary@www.cftc.gov.
Please include 'Regulation of Retail Forex' in the subject line of your message and the identification number RIN 3038-AC61 in the body of the message.
You can also submit your comments by any of the following methods (include above ID number):
Fax: (202) 418-5521
Mail: David Stawick, Secretary
Commodity Futures Trading Commission
1155 21st Street, N.W.,
 
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Rin 3038-ac61

Dear Sir or Madam,
With the new proposed legist ration it is a good to bring the registration into account and should of been done before, but what I can’t understand is the change in reducing the maximum leverage for US Retail Forex to 10:1as this for the retailer will just not be viable, at the moment I have three separate accounts in the USA but if this comes into force I will have to close them down and open new accounts to Europe and Australia, I just can’t understand the logic in this part of the legist ration, and it’s my personal belief that this should be reviewed before any implantation.

Regards

Graham Blyth
 
Regulation Of Retail Forex

Dear Sir/Ma,

With reference to the subject above, am writing to make known my reservation.
I do not support the proposed regulation to set a maximum leverage for US retail forex to 10:1
Quoting a member of forex peace army,"I I love risk management. I can take or make the worst trading decisions in the world and only lose money at an incredibly slow pace. Risk management is a good thing, but this is ridiculous." I can`t agree less with this point of view. Moreso, this amount to denying me right to make my own informed trading decision.

Summarily, I am unequivocally stating and registering my rejection of this proposed regulation.
 
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