If the CFTC does this, say goodbye to retail forex in the USA

[Music Man]

Yes, you will have to put up 10 times the money to make the same trade that you can do today with 100:1 leverage. This will effectively make Forex trading the province of institutions and the very wealthy, who for the most part don't manage their own money anyway. In short, it is a way to get rid of the retail Forex trade altogether.

MM

 

[ari_neo22]

The End Of Forex Trading

I think with this margin level, All people can not follow Forex trader. It's need a big capital. So, say goodbye to Forex Trading.

 

[piphog]

I think it's hilarious that posts are being screened by mods and whoever isnt blindly attacking the CFTC's sensible proposal is having their posts removed.

no one will probably be able to see this, but the FPA is the biggest hypocritical ****hole -- censoring opinions that agree with the CFTC and support these sensible regulations.

the stock market underwent similar sensible regulations.

for hedging and responsible trading purposes, 10:1 is perfectly fine. thank you CFTC.

 

[Music Man]

You obviously don't want your little pool full of all these hoi polloi -- only those with at least 100K of capital need apply, eh? This rule isn't about risk, it's about pulling up the ladder.

Forex isn't like stocks. Currency pairs generally do not go up or down by 100%, they fluctuate by fractions of a cent. A 1 cent move is big, a dime simply enormous. Without higher leverage, the profit potential is very small indeed, unless you have large capital at work.

At 55, my plan was to live off Forex, and at 100:1, that is an attainable goal. At 10:1, well, I could not live off Forex unless I had 10 times the capital I do. So your elitist and holier-than-thou comments about "responsible" and "reckless" are not only factually inaccurate and merely your fetid opinion, they cause me material harm, if made into law.

Maybe they could make a kiddie pool for the young, inexperienced or innumerate to play in? Maybe they should not be allowed any leverage at all? Plastic knives only!

MM

 

[briansnj]

I think it's hilarious that posts are being screened by mods and whoever isnt blindly attacking the CFTC's sensible proposal is having their posts removed.

I have never known FPA to censor a counter opinion unless it was too hostile, crude or had other issues like pushing a website, etc. So you are very wrong on that count.

the stock market underwent similar sensible regulations.

for hedging and responsible trading purposes, 10:1 is perfectly fine. thank you CFTC.

There are literally hundreds of thousands of stock market traders that disagree and would give anything to see that changed. Just read the commentary of popular trading magazines or in the WSJ or Barron's. This is an old argument that falls FLAT for one simple reason...CHOICE.

If you want to trade 10:1 leverage...great. If you like it...great. By why should it be forced on anyone? My way is choice. If brokers are allowed to offer us a wide range of leverage we are all free to choose. If we only have 10:1, you might be happy but what about the rest of us? Is that fair?


I can choose to use anything from 10:1 leverage or 100:1 leverage at my broker.

If the CFTC FORCES 10:1 on Forex traders we lose choice. So by your logic, we should all be forced to drive 4 wheel drive SUVs with 10 air bags under 25 MPH at all times and no one can ever have a motorcycle or Mustang convertible because it is not safe. And I suppose that is just fine by you? You can only eat fish and never have another cheeseburger again because it is healthier/safer?

See how easily and tragically that logic fails?

 

[zarni]

I have never known FPA to censor a counter opinion unless it was too hostile, crude or had other issues like pushing a website, etc. So you are very wrong on that count.




There are literally hundreds of thousands of stock market traders that disagree and would give anything to see that changed. Just read the commentary of popular trading magazines or in the WSJ or Barron's. This is an old argument that falls FLAT for one simple reason...CHOICE.

If you want to trade 10:1 leverage...great. If you like it...great. By why should it be forced on anyone? My way is choice. If brokers are allowed to offer us a wide range of leverage we are all free to choose. If we only have 10:1, you might be happy but what about the rest of us? Is that fair?


I can choose to use anything from 10:1 leverage or 100:1 leverage at my broker.

If the CFTC FORCES 10:1 on Forex traders we lose choice. So by your logic, we should all be forced to drive 4 wheel drive SUVs with 10 air bags under 25 MPH at all times and no one can ever have a motorcycle or Mustang convertible because it is not safe. And I suppose that is just fine by you? You can only eat fish and never have another cheeseburger again because it is healthier/safer?

See how easily and tragically that logic fails?

You miss one little piece here and that is that banks do trade on no leverage. Saying or implying that you are discriminated against with a 10:1 leverage restriction is nonsense. What bothers me is all the paranoid talk about the CFTC out to get you.
Yes it is not good for people who know what they are doing but it's beneficial for most. The government cares about the majority not the minority.

 

[Music Man]

Zarni,

You are beginning to get a small inkling of reality in your admission that "banks do trade with no leverage". Why? Because they have vast amounts of capital. If they see a low risk way to make $1 million by trading a $100 million dollars, it's great for them. So, the new rules favor large institutions by eliminating a viable profit opportunity for individuals.

Put in human terms, if I trade a 100K contract, every pip of profit is $10 dollars. To make the same profit at 10:1, I have to put up 10K rather than 1K. This means that if I have 100K of capital, instead of having a nice retirement income from conservative trading that yields 10% of deposit a month, I can only make enough to cover some expenses, like maybe half of my medical insurance. Which makes the whole idea of Forex as a retirement income pointless -- if I had a million bucks, I could, but I don't.

This has NOTHING to do with "protecting the majority" and everything to do with protecting the elite's private pool.

MM

 

[Ken Long]

I think it's hilarious that posts are being screened by mods and whoever isnt blindly attacking the CFTC's sensible proposal is having their posts removed.

no one will probably be able to see this, but the FPA is the biggest hypocritical ****hole -- censoring opinions that agree with the CFTC and support these sensible regulations.

the stock market underwent similar sensible regulations.

for hedging and responsible trading purposes, 10:1 is perfectly fine. thank you CFTC.

What are you talking about? All of your belligerent posts are still here.


Do you really want the government holding your hand and telling you what you can and cant do? So far they have proved to be a very poor host. They constantly make very poor decisions that affect our lives, our health, our money, all in favor of personal gain for themselves and their freinds.

That said, this isnt really about benefiting the ellite. This is more about the screaming masses of disillusioned that have been sucked into the Forex market by scams promising instant wealth with no effort. This is about controls and regulations that are supposed to protect us from the dangerous Forex market and our own bad decisions.

Bottom line, the government isnt doing this for us, or to us, we are not their primary concern. We are semi-competant traders, struggling, learning, taking resposibility for ourselves, and hopefully making some money. The governments only interest in us is in how to take a piece of our action for themselves, which they are working on. But when their fodder start to get sucked dry by Forex scams, when thousands of ignorant people start to view Forex trading as better, easier, and more profitable than working for a wage, and subsequently end up destitute. They have to do something. Whether we like it or not. We simply dont count in this picture. We are little more than financial vampires, sucking our livelyhoods out of the markets.

This will not kill Forex trading. It will simply limit certain aspects of it. Just wait untill they put capitalization limits on day traders, or add a 1 pip transaction tax.

This is not about us. Its about the thousands who are being fleeced, and still think this path is paved with gold.

 

[Ken Long]

Yes, you will have to put up 10 times the money to make the same trade that you can do today with 100:1 leverage. This will effectively make Forex trading the province of institutions and the very wealthy, who for the most part don't manage their own money anyway. In short, it is a way to get rid of the retail Forex trade altogether.

MM

Selective hearing, Selective thinking.

Obviously we will have to put up 10 times the money to trade. The question was, "How will this affect our margin requirments", "Will we still be required to maintain full margins against drawdowns, even though we will be paying 10X the current security deposit"

 

[Music Man]

Are you suggesting that they might do us the favor of allowing us more drawdown before the margin call? I do not know, and I am not sure that is desirable.

As for working a job, I have worked plenty. However, my working days are inexorably drawing to an end. There is no "go back to work" for a person of my age, regardless of my skills, experience or health. Once you get to my level, if you are not already financially independent, the only choices are to found yet-another-company, or become a trader. The last company I founded holds the rights to my commercial work, so that leaves trader.

Funny thing... my career as a technologist and inventor turned out to be far more of a gamble than any sort of honest trading could ever be. Ironic, isn't it? If I had abandoned the rat race 10 years ago, I would be in a far better place today.

At least in Forex, your rewards match the quality of your decisions and skills -- meritocracy at its purest. Not so in corporate America.

Good trading to you,

MM