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Caveat Emptor

  • #1
  • First Post: Jun 3, 2019 12:46pm Jun 3, 2019 12:46pm
Dear forex factory members,
I have spent the past ten years of my life as what most people would call a professional trader. I have pretty wide industry experience having worked for banks, HFTs & at an independent market making firm. While I have never worked at a broker myself I have a lot of friends that do and have acted as an LP to many of them so although it is not my speciality I do know quite a lot about the retail trading environment.
Unfortunately the things I do know are quite concerning and I have seen a lot of people getting abused by so called „experts, gurus etc“. So I would like to use this thread and offer my opinion should anyone want it on „Systems, EAs, Money Managers etc“ - just to clear things up I am not saying these are bad per se but I have encountered a lot of scams/unethical things surrounding these topics.
I am also more than happy to offer my 2 cents on anything related to market micsotructure (much more my speciality) - so things like „slippage/widening - what’s normal/ what isn’t, fair price of liquidity or my input on any execution disputes you may have with brokers or other things of that nature
What I don’t want to do is give any opinion on specific brokers, banks etc or give any kind of trading advise.

Ideally we are able to build an interesting discussion in this thread that helps some people avoid being taken advantage of.

take care -
M

p.s i got no clue if this is the right subforum or not. Pls feel free to move.
  • #2
  • Edited 3:13am Jun 4, 2019 1:44am | Edited 3:13am
IMO the whole industry (retail forex) is crooked, but it would't be so crooked if the players were not so deluded and gullible.
It's a fascinating feedback mechanism sort of like a symbiosis (but not a win-win for both parties!).
The industry is crooked because the players are deluded and gullible and the players are deluded and gullible because the industry is crooked.
  • #3
  • Jun 4, 2019 2:21am Jun 4, 2019 2:21am
I have a question. Suppose one makes a deposit with a broker x, trades for 5 years and their account is now 100K or more. Can one expect to get the money from the broker when the time comes to take it all out?

I'm sure that people who have accounts with few thousand, and are making consistent profits, can take out a few hundred euros from their trading account now and then, but what about long term trading with full effect of compounding the gains?

Is there, in your opinion, any retail brokers you can trust to work your account to several hundred thousands, and then be able take the full amount out. Or they simply say no and, for any reason, refuse to pay it out, but let you gratuitously take out your initial deposit, meanwhile you have lost years of hard work and substantial amount of money that seemed to be already yours?
  • #4
  • Jun 4, 2019 12:48pm Jun 4, 2019 12:48pm
Quoting Mingary
IMO the whole industry (retail forex) is crooked, but it would't be so crooked if the players were not so deluded and gullible. It's a fascinating feedback mechanism sort of like a symbiosis (but not a win-win for both parties!). The industry is crooked because the players are deluded and gullible and the players are deluded and gullible because the industry is crooked.
Agree completely with this statement.
Unfortunately there is so many gullible people that think of trading is some get rich quick scheme...
  • #5
  • Jun 4, 2019 12:53pm Jun 4, 2019 12:53pm
Quoting drbrain
I have a question. Suppose one makes a deposit with a broker x, trades for 5 years and their account is now 100K or more. Can one expect to get the money from the broker when the time comes to take it all out? I'm sure that people who have accounts with few thousand, and are making consistent profits, can take out a few hundred euros from their trading account now and then, but what about long term trading with full effect of compounding the gains? Is there, in your opinion, any retail brokers you can trust to work your account to several hundred...
There are so many brokers out there that have banking licenses - this is about as safe as money can ever be. If you have 100k on some super shady broker that’s regulated in some weird jurisdiction then maaaaaaybe they can make your life hard when withdrawing your balance. But at one of my old work places with kept some money with a broker because we used them for Prime of Prime and regularly deposited/withdrew 7 figures without any kind of issue.
  • #6
  • Feb 19, 2020 11:35am Feb 19, 2020 11:35am
Safety on the market does not depend only on the broker or the situation on the market. I have taken great responsibility for myself, because only your activity and performance determine whether you will earn or not, whether you will see real progress, whether you will be able to work through your mistakes and learn to trade in such a way that your actions will be considered and will help you realize your potential. I think that this approach allows you to be more organized and active. In addition, you should not forget that you need to learn all the time and spare no effort. I think that if you have it all, the result will not wait. And you just won't have anyone to blame, no matter what happens, you can handle it.
  • #7
  • Feb 20, 2020 11:58am Feb 20, 2020 11:58am
And nobody ever said that forex or trading in general is a transparent business, which can guarantee you a hundred percent result, especially considering, firstly, the number of those who want to quickly make big money without making any efforts, and secondly, given the fact that we have a huge number of dishonest companies that do everything possible to ensure that traders leave their money and invest more money. In this business, as in any other, you should always stay on the safe side and do your best to get around the invisible obstacles that the market or your broker is preparing for you. Although you can change your broker in any situation. And it is also advisable to carefully consider your action plan.
  • #8
  • Last Post: Feb 23, 2020 1:45pm Feb 23, 2020 1:45pm
In fact, there are now clear and precise categories that allow you to determine both the integrity of the broker and whether your strategy can be considered safe and profitable. And that's where it all depends on your desire. Those who believe that trading is not a serious business, and will consider it as such. Those people, who have come to do business and are ready to take responsibility, will be able to understand these nuances and be sure to choose a format that will meet their expectations or at least be able to bring them closer to the intended goal. Plus, it is worth allocating a certain amount of money for the so-called costs to check the broker and his forces, otherwise I think it is impossible to fully assess the situation. Am I right, don't you think?
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