Introducing Brokers - Safe? | Forex Factory

Options

Permalinks
Print Thread

Similar Threads

Best brokers for introducing brokers(IB)? 20 replies

Introducing Brokers (IBs) + Proprietary Trading Firms 4 replies

Are Ur Funds Safe...with Ur Brokers...? 39 replies

Suggestions For Swiss Introducing brokers 0 replies

Introducing brokers for www.bgcfx.com/ 11 replies

Introducing Brokers - Safe?

  • #1
  • First Post: Mar 14, 2007 2:13pm Mar 14, 2007 2:13pm
I am debating on whether or not to use an IB to set up a brokerage account or two. As some of you may be aware, they can speak on your behalf and possibly get a few perks for you. Being that the Forex business has somewhat of a cloud over it, I feel it necessary to do a little questioning before I begin my process. Have traders here used IBs and if so... has everything gone well? They are permitted to see your statement and records (what I have read), does this fact turn anyone away? Can they actually act on behalf of your account (I would figure they couldn't, being that I actually have an account with FXCM or GFT etc). Are futures IBs different in nature than are forex IBs?

Any input would be appreciated. As you can tell... I am full of questions

Thanks-

I did a quick search for this topic and didn't find one. If there is one, please moderator direct me to it.

Well, I see the similar threads after I posted this message. They do not specifically speak of what I am interested in though.
The market is my nation. Traders, my family. Hello, brothers and sisters!
  • #2
  • Mar 14, 2007 3:42pm Mar 14, 2007 3:42pm
Quoting StockKJay
I am debating on whether or not to use an IB to set up a brokerage account or two. As some of you may be aware, they can speak on your behalf and possibly get a few perks for you. Being that the Forex business has somewhat of a cloud over it, I feel it necessary to do a little questioning before I begin my process. Have traders here used IBs and if so... has everything gone well? They are permitted to see your statement and records (what I have read), does this fact turn anyone away? Can they actually act on behalf of your account (I would figure they couldn't, being that I actually have an account with FXCM or GFT etc). Are futures IBs different in nature than are forex IBs?

Any input would be appreciated. As you can tell... I am full of questions

Thanks-

I did a quick search for this topic and didn't find one. If there is one, please moderator direct me to it.

Well, I see the similar threads after I posted this message. They do not specifically speak of what I am interested in though.
Hi Stock,
I personally see no benefit in using an IB....some have option of adding more spread for their clients. Seems just about ANYBODY can be an IB for some FX firms....do you really want that?? That said, only IB I might consider would be EFX as IB for MBT as they offer 50% off of charting package, and MBT offers none, from a recent call to MBT. That could always change though.
What perks are you seeking?? You could always request perks for yourself. Though you will need a nicely sized funded acount. FXCM offers bennies for an account over 25k ( a Gold package ) BUT...I left FXCM, They where decent for carry trades/long term postions
( I only do long term with interest ) though spreads are too wide for shorter terms that I trade.
Dukascopy is a decent broker...good spreads and low commission is a perk, though you will need minimum 50k and my minimum trade size is 250k...not sure how you trade and it what sizes.
Hope this helps....
Proper Prior Planning Prevents Piss Poor Performance
  • #3
  • Mar 15, 2007 10:05am Mar 15, 2007 10:05am
Quoting StockKJay
I am debating on whether or not to use an IB to set up a brokerage account or two. As some of you may be aware, they can speak on your behalf and possibly get a few perks for you. Being that the Forex business has somewhat of a cloud over it, I feel it necessary to do a little questioning before I begin my process. Have traders here used IBs and if so... has everything gone well? They are permitted to see your statement and records (what I have read), does this fact turn anyone away? Can they actually act on behalf of your account (I would figure they couldn't, being that I actually have an account with FXCM or GFT etc). Are futures IBs different in nature than are forex IBs?

Any input would be appreciated. As you can tell... I am full of questions

Thanks-

I did a quick search for this topic and didn't find one. If there is one, please moderator direct me to it.

Well, I see the similar threads after I posted this message. They do not specifically speak of what I am interested in though.
if your trading with big money ib has it's benifits when it comes to leverage, for example if you go with vcapfutures the will give you 100:1 leverage and they or an ib for manfx and fcstone witch only gives you 30:1 and lower leverage. so depends on what your looking for also there atcbrokers.
If I Go Broke Trying Then I Will die happy.
  • #4
  • Jan 16, 2008 11:37am Jan 16, 2008 11:37am
"if your trading with big money ib has it's benifits when it comes to leverage, for example if you go with vcapfutures the will give you 100:1 leverage and they or an ib for manfx and fcstone witch only gives you 30:1 and lower leverage. so depends on what your looking for also there atcbrokers."

Why do u get lower leverage compared to the others?
  • #5
  • Edited 1:51pm Jan 16, 2008 1:31pm | Edited 1:51pm
Quoting StockKJay
I am debating on whether or not to use an IB to set up a brokerage account or two. As some of you may be aware, they can speak on your behalf and possibly get a few perks for you. Being that the Forex business has somewhat of a cloud over it, I feel it necessary to do a little questioning before I begin my process. Have traders here used IBs and if so... has everything gone well? They are permitted to see your statement and records (what I have read), does this fact turn anyone away? Can they actually act on behalf of your account (I would figure they couldn't, being that I actually have an account with FXCM or GFT etc). Are futures IBs different in nature than are forex IBs?

Any input would be appreciated. As you can tell... I am full of questions

Thanks-

I did a quick search for this topic and didn't find one. If there is one, please moderator direct me to it.

Well, I see the similar threads after I posted this message. They do not specifically speak of what I am interested in though.
IB's are nothing but a benefit to the trader.

IB's generally have more leverage with the dealing firms they work with due to the amount of business they bring. If there is ever a problem with your account in any way, you are much better off with an IB on your side to help get it resolved.

One huge perk that some IB's offer is a trade rebate -- a portion of the spread kicked back to the client on EVERY trade he makes.

So, if a client of trades at FXCM, FXDD, GAIN, or even MB Trading they can expect $3-$5 back on each trade they make, regardless of the trade's outcome.

I personally know that clients pay less and have a better trading experience under certain IB's than if they go directly to the dealing firm instead.

I'm not going to spam the board, so PM me for more info.
  • #6
  • Jan 16, 2008 1:55pm Jan 16, 2008 1:55pm
StockKay: as far as i am informed, IBs are not allowed to hold client money (at least not in the states). They just gather clients and convey them to a broker - and get compensated for that. So IBs are as safe as the broker they introduce to.
  • #7
  • Jan 16, 2008 2:02pm Jan 16, 2008 2:02pm
Quoting shrike
StockKay: as far as i am informed, IBs are not allowed to hold client money (at least not in the states). They just gather clients and convey them to a broker - and get compensated for that. So IBs are as safe as the broker they introduce to.
That's correct, IB's do not, and should not hold your money.

An IB SHOULD, however, provide some sort of value-added service for using them as your IB. They get compensated through the spread on your trades -- and IMO, should give some of that back to the traders who use them.

Additionally, as I've said in a few threads now, the IB tends to have more leverage when it comes to problem resolution, and can really give you the benefit of the doubt when a conflict arises.
  • #8
  • Jan 16, 2008 2:31pm Jan 16, 2008 2:31pm
BostonForex: do IBs usually get information on their clients accounts, like transaction history and so on?
  • #9
  • Jan 16, 2008 3:45pm Jan 16, 2008 3:45pm
While slightly of the topic I believe this also proteins to doing business with IB’s.. , as of December 21st I heard all IB must be registered with NFA and should also have a net cap in place, but can’t seem to find any hard evidence making this fact... Would anyone know about this, please fill us all in...
  • #10
  • Jan 16, 2008 4:09pm Jan 16, 2008 4:09pm
Quoting KasperFX
While slightly of the topic I believe this also proteins to doing business with IB’s.. , as of December 21st I heard all IB must be registered with NFA and should also have a net cap in place, but can’t seem to find any hard evidence making this fact... Would anyone know about this, please fill us all in...
All ib in USA (only) and must have 45000$.
  • #11
  • Jan 16, 2008 5:29pm Jan 16, 2008 5:29pm
As an IB myself, I can say that there are plenty of benefits one can have if they find themselves the right IB to suit their needs. This is crucial because not all IBs are the same. Some you may not want to have the ability to see your account, some you do. It all depends.

Some people want IBs who can help them learn how to trade, some want IBs to help them maintain sound risk management, some (if not all) want a kickback from the spread, etc...

Just contact a few on your own volition, ask what they are and are not willing to do, then make the decision as to whether or not it seems it will be useful to you.


As a general rule of thumb, avoid anyone trying to pressure you into anything.
  • #12
  • Jan 16, 2008 5:33pm Jan 16, 2008 5:33pm
Quoting AKforex
All ib in USA (only) and must have 45000$.
Is there a link to this from any official-type source? There's been a lot of rumor flying around and I really want to see actual evidence.
  • #13
  • Jan 16, 2008 6:55pm Jan 16, 2008 6:55pm
all IB's make money on your trading. Some sites offer a rebate (they are willing to pay you a small portion of the money the broker pays then). Really it just helps you get back a little bit more.
I say just do your homework and pick who you want ...sure you can help some company out by giving them an IB revenue but really if you know how to trade the you will make enough not to worry about the small amount that a company will kick back to you as a rebate.
M4X............ Hedging My Way To Profits!
  • #14
  • Aug 6, 2009 5:22am Aug 6, 2009 5:22am
Can IB's see your trades and trade against you in any way, shape or form? This is what concerns me.
  • #15
  • Aug 6, 2009 12:19pm Aug 6, 2009 12:19pm
Quoting pa18
Can IB's see your trades and trade against you in any way, shape or form? This is what concerns me.
IB's do not and never should hold your funds. Thus, it's impossible for them to trade against you.

They have no control over the FCM's desk risk management.

However, at most brokerages, the IB is provided with back office (MetaManager from firms like FXDD or CMS) where the IB can see all of your trades in real time.

But what can they do with this? Try to emulate your trading? Very unlikely, they'd have to sit there all day and watch your trades -- impossible.
  • #16
  • Last Post: Aug 6, 2009 6:48pm Aug 6, 2009 6:48pm
Quoting pa18
Can IB's see your trades and trade against you in any way, shape or form? This is what concerns me.
IB's are just the ''salesmen'' trying to make some money on the market by connecting two interested sides. And nothing else.
2 traders viewing now