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Breaking: Australian Parliament Passes Product Intervention

  • #41
  • Aug 6, 2019 3:01pm Aug 6, 2019 3:01pm
Quoting Bicarus
{quote} white paper consultation closed today.....
Thanks for the post Bicarus, you make some good points.

Does a decreased margin actually protect the trader, no it merely draws out their pain. A better solution is as you say, educating the trader.

As for "counterparty reports", it's a good idea in that it may help to clear out the bucket shops and steer traders to more reputable brokers. In fact my broker, Global Prime, is one of the few brokers who already offer this service.
  • #42
  • Aug 12, 2019 9:20pm Aug 12, 2019 9:20pm
Quoting turnip15
{quote} Their Global EU branch will accept cards: https://www.ampglobal.com ( Scroll to bottom of page )
Looks alright, they only offer MT5 platform which isn't all that great. I assume cgq (filtered) data? Do you trade with them?
  • #43
  • Aug 15, 2019 7:39am Aug 15, 2019 7:39am
for the first time. ASIC's acting comissioner has directly named the countries in question.

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if you are from these countries. good luck to you.

if you are not, expect most of your brokerages to be giving you the option of moving back under ASIC's purview. with the clause. that you understand the risk that your leverage may be affected/decreased in the near future.
  • #44
  • Aug 15, 2019 7:46am Aug 15, 2019 7:46am
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judging by how ASIC enforced the changes the Short term credit industry. It seems that they are not going at it head on. but instead still allowing relative line. with option to tighten it further down the road. perhaps a insight to how they will enforce the fx market industry as well.
  • #45
  • Aug 15, 2019 7:51am Aug 15, 2019 7:51am
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after reviewing the data colleted from brokers in april. these are the stats.

just look at the numbers. it is indeed staggering. the influx of eu/china clients due to marketing/esma's changes are the direct link. Cathy has also acknowledge that this is moving Australia onto the world's map to become a fx transaction hub on par to the UK. However, being a hub requires will also require more stringent regulation.
  • #46
  • Aug 15, 2019 8:41am Aug 15, 2019 8:41am
What's interesting is that some FCA-regulated brokers are still offering high leverage as before. Perhaps with Brexit on the horizon, London isn't about to relinquish its status as the world's forex hub by requiring brokers to adhere to rules similar to ESMA's.

I believe ASIC will be on the right track if instead of decreasing leverage in the guise of client protection, it uses its regulatory powers where it really counts: going after unscrupulous brokers who scam clients by widening spreads. freezing their platforms, refusing withdrawals, etc.
Amor Fati--F. Nietzsche
  • #47
  • Aug 15, 2019 10:31am Aug 15, 2019 10:31am
Australia became an FX transaction hub just because it did not decrease leverage like ESMA

They will do the right thing once again and will not follow ESMA ' s rookie footsteps
  • #48
  • Aug 15, 2019 6:02pm Aug 15, 2019 6:02pm
Quoting Bicarus
{image} the influx of eu/china clients due to marketing/esma's changes are the direct link. Cathy has also acknowledge that this is moving Australia onto the world's map to become a fx transaction hub on par to the UK. However, being a hub requires will also require more stringent regulation.

How to regulate brokers and margins without strangling the developing "hub", that is her challenge. Can she do it!
Gov actors tend to cock-up most opportunities, but we will see!
  • #49
  • Aug 22, 2019 5:58am Aug 22, 2019 5:58am
Asic just released consultation papers. Leverage ban proposal. 20 leverage for fx
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  • #50
  • Aug 22, 2019 6:13am Aug 22, 2019 6:13am
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  • #51
  • Aug 22, 2019 6:26am Aug 22, 2019 6:26am
Quoting Bicarus
{image}
Ridiculous.. but here is my proposal: stay calm.
  • #52
  • Aug 22, 2019 6:53am Aug 22, 2019 6:53am
do you know if they intend stopping Australian's from opening accounts overseas,....ie where the leverage rules dont apply??
  • #53
  • Aug 22, 2019 7:04am Aug 22, 2019 7:04am
Quoting MXT
Australia became an FX transaction hub just because it did not decrease leverage like ESMA They will do the right thing once again and will not follow ESMA ' s rookie footsteps
Looks like they now are the worst. lol
Return To Disorder
  • #54
  • Aug 22, 2019 7:21am Aug 22, 2019 7:21am
Quoting rockit
{quote} Looks like they now are the worst. lol
oh my god , hopefully they will never enact that proposal , what a shame
  • #55
  • Aug 22, 2019 7:41am Aug 22, 2019 7:41am
full report

https://download.asic.gov.au/media/5...ugust-2019.pdf
  • #56
  • Aug 22, 2019 8:02am Aug 22, 2019 8:02am
Quoting PeterE
do you know if they intend stopping Australian's from opening accounts overseas,....ie where the leverage rules dont apply??
i believe it is a matter of time before offshore adopts the same policies, but as of now.. if u are a aussie with a au broker. u cannot request to be put under au broker's offshore entity
  • #57
  • Edited 12:42am Aug 23, 2019 12:27am | Edited 12:42am
some sidenotes.
if asic's leverage cap passes whilst it's mifid 2, best execution/execution venue doesnt,

bank's analyst are expecting a decrease of 60% of possible orders coming out of AU. ie; high chance your trade positions will not ever make it to the interbank directly due to the small size. given that based on the brokers existing retained earnings, they are well capitalized to book your order in house. brokers will most likely consolidate all to a certain threshold, do their aggregation before passing it on if needed.

if a broker is offering an average of 100 leverage.
with asic's move. to standardize 20. it essentially means broker's earnings will be down 80%. given that the nature of any business is to make more money. it is believed that they will be retaining more earnings. to allow them to conduct transactions and settlement in house. given that even tho leverage is decreased, statistically losers will still be losers.
  • #58
  • Aug 23, 2019 1:22am Aug 23, 2019 1:22am
Quoting Bicarus
they are well capitalized to book your order in house. brokers will most likely consolidate all to a certain threshold, do their aggregation before passing it on if needed. if a broker is offering an average of 100 leverage. with asic's move. to standardize 20. it essentially means broker's earnings will be down 80%. given that the nature of any business is to make more money. it is believed that they will be retaining more earnings. to allow them to conduct transactions and settlement in house. given that even tho leverage...

I've been thinking along the same lines. As a broker's customer base diminishes they are forced to become a bucket shop.
Has ASIC considered this unintended consequence? I doubt it!

In an attempt to reduce the retailers risk ASIC have merely shifted it, and perhaps even increased it. Brokers will be forced to increasingly and aggressively take the other side of the trade in order to survive.
  • #59
  • Aug 23, 2019 2:55am Aug 23, 2019 2:55am
Quoting MXT
{quote} oh my god , hopefully they will never enact that proposal , what a shame
There is no negotiation with this proposal, 20:1 is the new max fx leverage in Aus.

The question now is when does it commence?.....before the year is out is my guess!

I've already switched my account to 20:1. May as well get used to it.
  • #60
  • Aug 23, 2019 4:01am Aug 23, 2019 4:01am
Quoting PeterE
{quote} There is no negotiation with this proposal, 20:1 is the new max fx leverage in Aus. The question now is when does it commence?.....before the year is out is my guess! I've already switched my account to 20:1. May as well get used to it.
there is negotiation. draft a letter with your concerns from a retail client's pov and send it to [email protected] ASIC is making decisions from data collected from brokers and AFCA. would be good if they heard from word on the street about legitimate concerns on execution/manipulation/au brokers move clients offshore etc
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