Forex brokers are electronic scams - Leverage is a scam | Forex Factory

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Forex brokers are electronic scams - Leverage is a scam

  • #1
  • First Post: Nov 30, 2018 3:52am Nov 30, 2018 3:52am
Institutional traders do not use leverage and nobody will give you money to trade not bank not broker.
if broker has leverage over 1:1 it is scam, your profits will be delayed and account banned. This electronic scam do not use real money its electronic computer system making real price with unreal small bid/ask price while charging spread every day calling something like "swap" while in reality it doesnt exist.
If you buy eur/usd with account in eur on electronic platform you are making profit while in reality it is impossible in any bank/pblic exchange.
You can open "forex brokerage" with 5000$ get platform and take money from traders just like bookie.
According to electronic scam platform currently there is opened 450000 orders if it is min 0.01 lot or 1000$ we need minimum half billion dollars to "process orders".
How much you can make with this electronic scam as broker - revenue on 100.000 accounts is 4.5 million$ / year.
All "ecn" "cfd" "brokers" are electronic scam. You do not own anything money or stocks your deposit is on one account.
Currency moves max 5%/ a year, its "penny stocks" your profit will be max 6% - 7%/year trading via bank directly or institutional trading.
Im not sure even are these stock brokers are real. trading in bank i am directly connected to 35 stocks exchanges (whole planet) on NYSE to send real contract order real buy stock I am charged 0.04$/stock. why someone stock broker charge 4$ per order or 9$ per order.
Best institutionals make 20% - 30% per year charging high fees. while hedge funds are best bussiness if you are owner.
Most stock traders trade trends because they never owned company and do not know what is profitable company. Take example amazon . their total profit after tax, paychecks and everything is 8 bilions since start. but company is pumped to 100 billions , will you pay for company 200 billions for profit 8 billions in decades. is it profitable decision. yes to people who follow trend.
  • #2
  • Dec 23, 2018 6:10am Dec 23, 2018 6:10am
Can a true STP/ECN broker realistically offer 500:1 leverage?
Banks tend to offer anywhere between 10:1 and 25:1 maximum leverage depending on numerous factors from credit worthiness to the currencies being traded. Leverage greater than 30:1 in the Tier 1 (Bank) PB environment is unheard off.

Banks are very particular as to who they will extend credit to. A major money center Prime Broker therefore, would not take a broker offering high leverage as a client, especially given the risks involved.If you hear of someone marketing themselves an “institutional liquidity provider”, or “prime broker” and they are offering anything much above 100:1 leverage then don’t be fooled; it is quite possible that they are operating a market-maker/dealing desk model in some shape or form.

Say a client places a trade of USDJPY 5,000,000 at a leverage of 500:1. This trade will require margin of USD 10,000 (5,000,000 / 500). To place the corresponding matching trade with its bank liquidity provider at 25:1 leverage, the broker would need to employ margin of USD 200,000 (5,000,000 / 25) with its prime broker.

The broker therefore has to use 20 times more capital than the client to maintain the same size trade.
  • #3
  • Dec 23, 2018 6:26am Dec 23, 2018 6:26am
so most brokers are scammers then ???
LUCKY golden trades, LUCKY gold investor trading style
  • #4
  • Dec 23, 2018 9:03pm Dec 23, 2018 9:03pm
I think it really depends on what your definition of scam means. Business and scams are different. According to Cambridge Dictionary, a scam means an illegal plan for making money, especially one that involves tricking people.

But most brokers who provide leverage do notify traders how high their leverage goes, and traders are free to choose their account types and how high their leverage can go. Since broker offers this service to traders, and traders are willing to make this transaction, how do you say its a scam?

Just because it differs from your value doesn't make everything in this world a scam.
  • #5
  • Dec 24, 2018 9:30am Dec 24, 2018 9:30am
Quoting FXFcr
But most brokers who provide leverage do notify traders how high their leverage goes, and traders are free to choose their account types and how high their leverage can go. Since broker offers this service to traders, and traders are willing to make this transaction, how do you say its a scam?
They notify traders from 1000 to 2000 leverage which is fairy tale, they need half billion dolars on liqudity provider like commercebank or bank liquidity provider to process orders for institutional traders.

How many brokers who offer leverage over 30 can afford usa licence costing 20 millions? so problem is they are market makers not procesing orders to liquidity providers and if you earn any profit you are banned, you can get withdrawal only in case if your deposit is bigger then withdrawal mean you losing. I am in problem where to trade

But information provided by institutional bank trader max leverage is 30. If broker is real ECN broker who will pay 1.000.000 usd withdrawal of profit then leverage is 30. If leverage is over 30 then broker need to be billionaire or more probably market maker scammer because he needs 20 times more money then client order multiply with 100.000 accounts there is problem with processing ECN orders its expensive and cant afford liquidity provider.

Bussiness is market making meaning if you really earn 1.000.000 usd you stealing from them I need to know retail broker who will pay such profit. Oanda payed 20 mil for usa licence, but problem is recived e-mail from oanda for profitable trader saying "we must cancel you account withdraw your deposit" tactics. On institutional bank cant get account for real trading. Find one retail broker who will pay profit.
  • #6
  • Dec 24, 2018 3:10pm Dec 24, 2018 3:10pm
this is a scam
  • #7
  • Dec 24, 2018 3:57pm Dec 24, 2018 3:57pm
Hey , i just switched to oanda from Forex.com- cause forex.com started asking redicuously things like email support and stuff.( Started happening after withdrawing over 50k$). So u are saying oanda is going to do same shit to me?
  • #8
  • Dec 26, 2018 8:28pm Dec 26, 2018 8:28pm
Quoting igorc
{quote} They notify traders from 1000 to 2000 leverage which is fairy tale, they need half billion dolars on liqudity provider like commercebank or bank liquidity provider to process orders for institutional traders. How many brokers who offer leverage over 30 can afford usa licence costing 20 millions? so problem is they are market makers not procesing orders to liquidity providers and if you earn any profit you are banned, you can get withdrawal only in case if your deposit is bigger then withdrawal mean you losing. I am in problem where to trade...
Personally I do not trust brokers that give leverage that's higher than 500, because that's too risky for both the business and traders.

Just giving my two cents, banks do not provide high leverage because they are unwilling to carry the risk upon themselves, while broker is willing to risk their capitals and investments into this, which is how brokers play an important role in this supply and demand market.
  • #9
  • Dec 26, 2018 10:48pm Dec 26, 2018 10:48pm
Subs. Thanks and
Regards
  • #10
  • Dec 26, 2018 10:53pm Dec 26, 2018 10:53pm
Quoting igorc
trading in bank i am directly connected to 35 stocks exchanges (whole planet) on NYSE to send real contract order real buy stock I am charged 0.04$/stock. why someone stock broker charge 4$ per order or 9$ per order.
Well, you have to remember that in order to trade on the NYSE, you need to have your license (membership, basically). For individuals, since the cost of that may be a couple of million dollars if the economy is doing well, and is an extreme pain in the butt to attempt to get, the only option is to go through a broker that has that membership. So if you want to play, you gotta pay!

Being charged $0.04/stock, that is actually per share. And that is actually a lot, as most institutional investors, including banks, are charged in the $0.0025/share range. Since most institutional investors trade in 10,000 share increments and in certain instances are required to do hundreds of thousands of transactions per month, even at $0.002/share turns into quite a bit of money. Heck, Apple had over 58 million shares traded today alone, with a big majority coming from institutional investors (IRAs, 401k, mutual funds, etc)....
  • #11
  • Dec 29, 2018 5:46am Dec 29, 2018 5:46am
Forex liquidity providers are banks according to brokers claim: Bank of america, Commerce bank, Barclays Bank, PLC – Citadel Securities LLC – Citibank N.A. – Deutsche Bank AG.

So when you ask them want to open ECN brokerage service to clients will you be my liquidity provider, answer is sure just deposit 450 million dollars and we will give you leverage less then 3 you can charge commision and pray there is no margin/leverage overload by users in ECN enviroment.

So brokers need per liquidity provider 450 millions $ per liquidity provider and if client put 0.01 lot (1000$) broker need 20 times more money 20.000$ + commisions (multiplied with 100.000 acount is sick margin ) to process order in ECN eviroment where there is no conflict of interest with client profit or no profit.

So brokers claiming are ECN and leverage over 100 are fairy tales with conflict of interest against client in mt4 platform and no processing client orders to Liquidity providers. More probably 100% are B - book forex brokers with no money who cant afford leverage like 100, 500 or 1000 to bank liquidity providers.
  • #12
  • Dec 30, 2018 6:55am Dec 30, 2018 6:55am
Quoting FXFcr
I think it really depends on what your definition of scam means. Business and scams are different. According to Cambridge Dictionary, a scam means an illegal plan for making money, especially one that involves tricking people. But most brokers who provide leverage do notify traders how high their leverage goes, and traders are free to choose their account types and how high their leverage can go. Since broker offers this service to traders, and traders are willing to make this transaction, how do you say its a scam? Just because it differs from...
I agree everything is scam since money intrduced 3000 years ago but most important is how long scam can go undetected. Chruch writed bible and scammed people for 800 years taking money in objects. Self proclaimed Kings scammed people they own land to get a cut while land was there for 5 billion years. Incurance company scam people for 200 years claiming you will get rich if you die and secure family why mathematicaly is impossible to die and charge scam for 25 years (300.000 people dies per day compared to 8 billion people) its 200 years old legal scam and still working. do you know how much realy cost and how much is really payed to users of insurance? Or work in chinese factory to produce apple phone for scammed money. really cost of apple phone from matterial to end is 20$ but you are scammed for 1000$ its wortheless and cant even sell it after year. Real cost of car pruction in factory from raw matterial like aluminum engine is 600$ but you are charged 20.000$ and scammed also from "broker" who sell you car. Its just scam long term scam. Same as brokers with fancy web sites and mt4 app who pass orders to liquidity provider and take deposit money in nigeria from internet caffe where they pay 2$ for internet access.
  • #13
  • Dec 30, 2018 7:24am Dec 30, 2018 7:24am
Attached Image
  • #14
  • Dec 30, 2018 10:37am Dec 30, 2018 10:37am
With the technology available today, brokers don't need to be scammers.

Brokers just monitor a traders risk and determine if the positions will go live to the ECN market or they internalize the order, keeping it in house, taking the other side of the trade. Brokers know the odds of your positions and probability over past performance what's gonna happen to you.
Learn, a forex trader must, unlearn and relearn he will.
  • #15
  • Dec 31, 2018 5:21am Dec 31, 2018 5:21am
think it really depends on what your definition of scam means. Business and scams are different. According to Cambridge Dictionary, a scam means an illegal plan for making money, especially one that involves tricking people.
  • #16
  • Dec 31, 2018 9:19am Dec 31, 2018 9:19am
Quoting igorc
{quote} I agree everything is scam since money intrduced 3000 years ago
Everything that cost more money than you think it is worth may be overpriced, but really doesn't make it a scam. People pay for convenience and technology. Are many things overpriced? You bet they are! But if you want the use of technology or convenience, you have to expect to pay money for that.

You could have free access to all needed raw materials (ores and sand and even polymers), but you couldn't produce a car yourself, or a phone or TV or even a refrigerator. You can certainly grow your own cotton plants, and pick the cotton, and de-seed the cotton, and make it into fibers, and weave it into cloth, and dye the cloth, and cut the cloth as needed, and then sew the cloth into pants and a shirt....OR you could pay for the convenience of having someone else do all that.

I have to ask: If you honestly feel currency trading is a scam and that it is impossible to make money, why do you continue to trade?
  • #17
  • Edited 5:26am Jan 1, 2019 3:00am | Edited 5:26am
Quoting moneymaker2
{quote} Everything that cost more money than you think it is worth may be overpriced, but really doesn't make it a scam. People pay for convenience and technology. Are many things overpriced? You bet they are! But if you want the use of technology or convenience, you have to expect to pay money for that. You could have free access to all needed raw materials (ores and sand and even polymers), but you couldn't produce a car yourself, or a phone or TV or even a refrigerator. You can certainly grow your own cotton plants, and pick the cotton, and de-seed...
Morning, I said it is working on long term time frame, if price is 100 pipis above moving average trend is forming which last 10 working days then goes opposite, with sl 150 pips and tp 150 works like charm, need to run on broker for 3 years to get profit from 400$ to 3 million compounded average with leverage.

problem I found that all "retail brokers" scammed someone for money can find possitive review and are market makers who will ban account and will waste time and money. ECN in retail industry does not exist 100% are market makers with conflict of interest and without money on their account to pay profit. Cant find negative review for stocks exchanges.

Investigation found out broker who does pay profit (with 4 stars of forex peace army scammed accounts only over 300.000$ while payed less then 10.000k profits regulary, internal investigation into every broker from their credit worthiness and owner structure found they got revenue only 4 million $/year from deposits via skrill, visa and mastercard, bank account and that is for best retail broker, while worst on list are 27 brokers from nigeria. whitnes report from employes from "best retail broker" found they recived order to delay withdrawal for client 2011 who are 50$ in profit while worst on list do not even give deposit.

Visa and mastercard reacted to investigation and classify "retail brokers" as high risk and will ban deposits to "brokers" including other options to deposit will follow.

Without credit worhiness they are able to give for your 1$ leverage 500$ in fairy tale and bonuses from 100%.
  • #18
  • Jan 1, 2019 4:47pm Jan 1, 2019 4:47pm
I do agree that there are a lot of "brokers" out there that will do whatever they can to keep your money instead of giving it to you, especially with these 'bonus" offers. It may have something to do with how strongly they are regulated? I know before the CFTC dropped leverage for US residents to 50:1, I was trading with GFTforex (at 400:1) and they were AWSOME! I traded several years with them and withdrawals were very easy and quick and never a glitch, and I took money out every 2-3 weeks, so there were a lot of withdrawals! But it might have been so good because there were heavily regulated by the US at the time.....
  • #19
  • Last Post: Jan 21, 2019 3:07am Jan 21, 2019 3:07am
When was inflation in serbia many people buyed huge houses just selling currencies higher then current price and buying lower then current price to people. Their cash grow.
There is only one way to profit it is buy low sell high what broker is doing to all "traders" HE sell you high and buy from you LOW so only way to profit (doesnt matter price) on forex is to OPEN BROKERAGE.
There is no need to process orders to bank and math says it is impossible for "traders" to profit long term exept who buy from you low and sell you high.
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