Forex margin being lowered

Forex margin according to the nfa website, is offically being lowered to 100-1 which is 1% on most and 4% 25-1 on the exotics. So the firms with 200 or 400-1 leverage will no longer to be able to offer that type of leverage after november.

I'd be thankful if that's all they do. I wouldn't be surprised, if, over time, margin allowance is cut down even further. And 50:1 (which I have at Oanda) is plenty, anyway.

Agreed, They aim to keep it sort of inline with the currency futures but giving forex the benefit of the doubt becuase a broker wont let you lose more then you have in your account in FX. I futures you actually could. So smart move by the nfa

Notice I-09-18

September 24, 2009
Effective Date of Amendments to NFA Financial Requirements Sections 11 and 12 and the Interpretive Notice Regarding Forex Transactions
NFA has received notice that the Commodity Futures Trading Commission has approved changes to NFA Financial Requirements Sections 11 and 12 and related changes to the Interpretive Notice titled "Forex Transactions." The amendments adopt an alternative net capital requirement for Forex Dealer Members (FDMs) and eliminate the existing exemption from the security deposit requirement. These changes will become effective on November 30, 2009.
The amendments to Section 11 revise the existing alternative net capital requirement that is based on an FDM's liabilities to customers.1 As of November 30, 2009, the alternative requirement is $20 million plus 5% of the amount of customer liabilities over $10 million. FDMs that exclusively use straight-through-processing for their customer transactions are exempt from this alternative requirement and need only maintain the $20 million minimum (unless the firm is subject to a higher requirement under FR Section 1).
The amendments to Section 12 eliminate the existing security deposit exemption for FDMs that maintain 150% of their required net capital. This means that, beginning on November 30, 2009, all FDMs must collect a customer security deposit of at least 1% for the currencies listed in Section 12 and at least 4% for all other currencies.2
NFA's submission letters to the Commodity Futures Trading Commission include of the revised language and more detailed descriptions of the changes. You can access electronic copies of the February 23, 2009 submission letters at http://www.nfa.futures.org/news/PDF/...Notc021909.pdf (for the changes to Section 11) and http://www.nfa.futures.org/news/PDF/...Notc021909.pdf (for the changes to Section 12). Questions concerning these requirements should be directed to Valerie Kretschmer, Manager, Compliance ([email protected] or 312-781-1290) or to Sharon Pendleton, Director, Compliance, ([email protected] or 312-781-1401).

NFA never stop updating their playbook.... this is getting harder.... no hedge.... lowered margin.... yey..... it's fun and more challenging in forex market (sarcastic mode on)

As all funny NFA rules this will only be for US brokers.

I am currently trading with MIG and there have been absolutely no changes at all.
Hedging still allowed, and no nonsense as first in first out rule.

IMO this is a good thing

margin trading is usually misunderstood.

knowing how to use it one can indeed profit from 200x, 400x and more leverage.

but this is the ultimate stage in margin trading.

not everybody gets there.

so anyways this will affect those ones who will certainly figure out how to keep profiting from financial markets.

u konw,in china,Forex margin i not allowed