Why is FIFO used by some brokers? | Forex Factory

Options

Permalinks
Print Thread

Similar Threads

List of Brokers taking U.S. Clients with hedging, scalping and no FIFO 314 replies

what happens with stoplosses at FIFO brokers? 1 reply

Interbank FX Webinar: Discovering The Optimum FIFO Solution Together 5 replies

Interbank FX's FIFO Solution 1 reply

Forex EAs to stop functioning in the US following FIFO rule? 0 replies

Why is FIFO used by some brokers?

  • #1
  • First Post: May 28, 2020 6:30am May 28, 2020 6:30am
Dear traders, something has been troubling me a while. I cannot understand why FIFO is used by some brokers. this rule render a lot of strategy impossible and create more execution error. why people stick with this rule when there are options out there with no such regulations?
  • #2
  • May 29, 2020 4:43am May 29, 2020 4:43am
Because of NFA compliance rule. According to them, implementing FIFO brings more transparency in trading practices. Read more here:
https://www.investopedia.com/terms/n...rule-2-43b.asp
  • #3
  • May 29, 2020 5:39am May 29, 2020 5:39am
Quoting Deepak.Dubey
Because of NFA compliance rule. According to them, implementing FIFO brings more transparency in trading practices. Read more here: https://www.investopedia.com/terms/n...rule-2-43b.asp
I understand but does the fact that nowhere else is enforcing this rule means other regulations are not deeming this as unsafe or less transparent? or does it mean NFA does not have the capability to track such operations like other regulations do?
  • #4
  • May 29, 2020 5:57am May 29, 2020 5:57am
Quoting Deepak.Dubey
Because of NFA compliance rule. According to them, implementing FIFO brings more transparency in trading practices. Read more here: https://www.investopedia.com/terms/n...rule-2-43b.asp
Broker doesn't have any choice... because FIFO was forced by NFA...
NFA will take back their license if not comply...
it's illegal for Americans to involve with hedging...
Hedging is scam
  • #5
  • May 29, 2020 6:01am May 29, 2020 6:01am
Quoting penyuperwira
{quote} Hedging is scam
Scam by which side? Brokers or Traders?

Because if Traders, then Brokers wouldn't wait for regulation to stop it

IMHO
MAY THE TREND BE WITH YOU
  • #6
  • May 29, 2020 6:19am May 29, 2020 6:19am
Quoting Erebus
{quote} Scam by which side? Brokers or Traders? Because if Traders, then Brokers wouldn't wait for regulation to stop it IMHO
Both are scammer... they scam NFA
  • #7
  • Jun 1, 2020 2:36am Jun 1, 2020 2:36am
Quoting Deepak.Dubey
Because of NFA compliance rule. According to them, implementing FIFO brings more transparency in trading practices. Read more here: https://www.investopedia.com/terms/n...rule-2-43b.asp

More transparency , I like this part. Whoever invented this ruler were definitely on broker side not on traders side.
Whether you think you can, or you think you can't,you're right. H.F.
  • #8
  • Jun 4, 2020 11:39am Jun 4, 2020 11:39am
Well, they said that this was implemented so that traders do not keep a position open for eternity. That way, the market remains active.
  • #9
  • Jun 6, 2020 12:57am Jun 6, 2020 12:57am
Quoting Deepak.Dubey
Well, they said that this was implemented so that traders do not keep a position open for eternity. That way, the market remains active.
Even better
It's rule made for brokers,not for traders.
Whether you think you can, or you think you can't,you're right. H.F.
  • #10
  • Jun 6, 2020 9:28am Jun 6, 2020 9:28am
Quoting Deepak.Dubey
Well, they said that this was implemented so that traders do not keep a position open for eternity. That way, the market remains active.
I think this approach to keep market active is only help keep commission rolling.
  • #11
  • Jun 12, 2020 11:46am Jun 12, 2020 11:46am
I agree with both of you. The policy is biased in that respect.
  • #12
  • Jul 16, 2020 4:54am Jul 16, 2020 4:54am
Many users make use of FIFO or first-in, first-out method in trading. The FIFO method is actually the default method for deciding the shares that should be sold. In the FIFO, you’ll always be selling your oldest shares first before any other shares. Most traders pick the FIFO method as it results in a lower tax burden in comparison to any other method.
  • #13
  • Last Post: Jul 17, 2020 5:13pm Jul 17, 2020 5:13pm
FIFO is used by all other markets, so enforcing in in FOREX brings our market into alignment with other markets.
0 traders viewing now