Proposed New Leverage Legislation | Forex Factory

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Proposed New Leverage Legislation

  • #1
  • First Post: Feb 12, 2009 9:55am Feb 12, 2009 9:55am
Bottom line? FINRA is trying to place restrictions on the amount of leverage that can be used to trade FOREX. Currently,leverage is as high as 400:1. If the plan that FINRA is proposing is approved by the SEC, leverage will be reduced to 5:1 levels, which means you will need a lot more money ti trade with than you do now.
I didn't exactly know where to post this information but it is important enough to post on a new thread since if it passes it will mean the end of FOREX trading for the small investor. My suggestion is to go to the FINRA website and read about this proposal and voice your opinion to them as well as contacting your local congressman etc if you are against this legislation.
The FINRA website address is http://www.finra.org/Industry/Regulatio ... 09/P117744
  • #2
  • Feb 12, 2009 10:01am Feb 12, 2009 10:01am
Quoting Jollyroger
Bottom line? FINRA is trying to place restrictions on the amount of leverage that can be used to trade FOREX. Currently,leverage is as high as 400:1. If the plan that FINRA is proposing is approved by the SEC, leverage will be reduced to 5:1 levels, which means you will need a lot more money ti trade with than you do now.
I didn't exactly know where to post this information but it is important enough to post on a new thread since if it passes it will mean the end of FOREX trading for the small investor. My suggestion is to go to the FINRA...
Read forex savior's comments on this very subject - he adds clarity. p
  • #3
  • Feb 12, 2009 10:30am Feb 12, 2009 10:30am
I would rephrase that slightly......Hello crap. Goodby nap.
  • #4
  • Feb 12, 2009 12:05pm Feb 12, 2009 12:05pm
They have our best interests at heart. They're doing it for our own good because we don't have the sense to manage our own private economic affairs. It's for the children. It will reduce our carbon footprint. It's for the polar bears. It will help eliminate the speculators who are responsible for depressed commodity prices. It will help the tornado victims. It will help the victims of Katrina. It will help the survivors of the recent Australian wildfires. It will create jobs. It will stimulate the economy. It will help you lose weight, grow hair, and satisfy your woman. No, really.
  • #5
  • Feb 12, 2009 1:01pm Feb 12, 2009 1:01pm
  •  onu
  • | Joined Feb 2006 | Status: superior senior member | 746 Posts
Quoting opie999
They have our best interests at heart. They're doing it for our own good because we don't have the sense to manage our own private economic affairs. It's for the children. It will reduce our carbon footprint. It's for the polar bears. It will help eliminate the speculators who are responsible for depressed commodity prices. It will help the tornado victims. It will help the victims of Katrina. It will help the survivors of the recent Australian wildfires. It will create jobs. It will stimulate the economy. It will help you lose weight, grow hair,...
  • #6
  • Feb 12, 2009 6:33pm Feb 12, 2009 6:33pm
Ok, Finra is the largest non-governmental regulator for all securities firms doing business in the United States. How would it affect non-members is the question?

FINRA is requesting comment on a proposed rule prohibiting any member firm from permitting a customer to: (1) initiate any forex position with a leverage ratio of greater than 1.5 to 1; and (2) withdraw money from an open forex position that would cause the leverage ratio for such position to be greater than 1.5 to 1.

I may be wrong, but non-governmental and any member firm seem to be the key words here.

regards all
  • #7
  • Feb 12, 2009 8:50pm Feb 12, 2009 8:50pm
Extensive discussions on this topic...

http://www.forexfactory.com/showthread.php?t=152086

And

http://www.forexfactory.com/showthread.php?t=149665
  • #8
  • Apr 5, 2009 9:40pm Apr 5, 2009 9:40pm
interesting topic, not only would "joe the trader" be wiped out, but all the retail forex brokers would not have any biz, they are probably dead set against this because the higher leverage they can give to clients, the higher profits they will make when people's trades go south.

I doubt this will have any significant effect, UNLESS the big banks and wall street want the end of retail forex.
  • #9
  • Apr 5, 2009 10:23pm Apr 5, 2009 10:23pm
Quote
Read forex savior's comments on this very subject - he adds clarity. p

Hi piprac

Can you provide a link?

Thanx

Dale
  • #10
  • Apr 5, 2009 10:29pm Apr 5, 2009 10:29pm
Quote
Read forex savior's comments on this very subject - he adds clarity. p

Hi piprac

Can you provide a link?

Thanx

Dale
  • #11
  • Last Post: Mar 1, 2010 1:31pm Mar 1, 2010 1:31pm
I received this link that allows you to sign an electronic petition against the CFTC's leverage proposal. If you know of any places to pass it on please do so.
http://www.petitiononline.com/stopcftc/petition.html
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