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  • Leverage in retail FX: The banks pulled it down a year ago, so what’s new?

    From financefeeds.com

    Almost a week has passed since every brokerage based inside the European Union which offers OTC derivatives to a retail audience has had to adhere to a stringent set of new rulings which affect the means by which it provides its products. The pan-European directive, which mandates that, effective August 1, 2018, a restriction on the marketing, distribution or sale of CFDs to retail investors has been introduced. This restriction consists of leverage limits on opening positions, a margin close out rule on a per account basis, a negative balance protection on a per account basis; preventing the use of incentives by a ... (full story)

This article simply proves that the purpose the changes made by ESMA was not to protect the traders’ money, but to make traders deposit more and lose more, while the brokers make more profit.
Start with 1000$. Increase by 3% every day. After one year 2 213 314$
Quoting NotAtrader
This article simply proves that the purpose the changes made by ESMA was not to protect the traders’ money, but to make traders deposit more and lose more, while the brokers make more profit.
ofcourse not, since when in history have the banks done what's best for people? its laughable.
Most people don't know how to sit on their hands and they loose, and that's not my words. Nothing to do with leverage itself. ESMA is more about protecting traders from themselves not their money. jmho
Quoting venividivici
{quote} ofcourse not, since when in history have the banks done what's best for people? its laughable.
Well we all knew that, didn’t we! The funny thing is how ESMA insisted and the way they did lie, refusing to listen to the majority of the traders.

Fucking assholes and complete idiots.
Start with 1000$. Increase by 3% every day. After one year 2 213 314$
These ESMA regulations are rather restrictive and punitive. Why not encourage retail traders to get appropriate education in fx and other financial derivatives trading then allow them free hand to choose the leverage with which they are most comfortable? After all whenever anyone is getting in to forex trading they are normally warned of a possibility of excessive losses so one joins this business knowing what one is getting in to. Alternatively they should have come up with a capping of no more than 100:1. This way at least one needs not invest so much money which they may end up losing anyway if one does not have sufficient education.
Isn’t there anybody, any instance or governing institution that can hold these assholes responsible for what they do? Are these idiots untouchable Gods?
Start with 1000$. Increase by 3% every day. After one year 2 213 314$
Quoting NotAtrader
Isn’t there anybody, any instance or governing institution that can hold these assholes responsible for what they do? Are these idiots untouchable Gods?
Yes, they are. And YOU as everyone in E.U. is paying for their salary. What about that?
Quoting TheRealTruth
{quote} Yes, they are. And YOU as everyone in E.U. is paying for their salary. What about that?
Yeah I know. It sounds terrible. Anyway the justice should prevail at some point. I am a believer.
Start with 1000$. Increase by 3% every day. After one year 2 213 314$
it will get more drastic over time this is only the start - obviously we all know human nature take one thing away and then u want it all back
Leverage reduction was a good idea, implemented to protect the brokers. Still not enough to keep most from certain death.

https://en.wikipedia.org/wiki/FXCM

"Its U.S. accounts were sold to Gain Capital. About 40,000 customer accounts were sold at about $375 each."
"If The Fool persists in his Folly he will become wise." - William Blake
Quoting The Fool
Leverage reduction was a good idea, implemented to protect the brokers. Still not enough to keep most from certain death. https://en.wikipedia.org/wiki/FXCM "Its U.S. accounts were sold to Gain Capital. About 40,000 customer accounts were sold at about $375 each."
Not to such a degree. 1:50 would do.
Quoting The Fool
Leverage reduction was a good idea, implemented to protect the brokers. Still not enough to keep most from certain death. https://en.wikipedia.org/wiki/FXCM "Its U.S. accounts were sold to Gain Capital. About 40,000 customer accounts were sold at about $375 each."
And they're still cheating outside the confines of the ambiguous agreement. lolz
Anyone who says the new ESMA rules (particularly those pertaining to leverage reduction) are designed to protect traders is clearly prevaricating.

Whatever happened to freedom of choice? All things being equal, leverage is every trader's friend, no matter how small or big his/her capital is. What's important is how it's used. Let nobody tell you otherwise.
Amor Fati--F. Nietzsche
Well, as a business - the biggest losers would be the brokers and banks. And the funniest is that banks as Saxo that were whining for leverage are now suffering the most. What would happen with these new requirements: people will trade less (respectively loose less), new account inflow would be reduced and some of the brokers would not event remain with minimal account numbers to do business. Profitable retail traders would continue to trade adapting their profit expectations and acquiring capital if necessary.
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  • Posted: Aug 6, 2018 10:37am
  • Submitted by:
     Newsstand
    Category: Forex Industry News
    Comments: 14  /  Views: 4,506