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Class Action Lawsuit Against FXCM

  • #141
  • Feb 13, 2011 5:48pm Feb 13, 2011 5:48pm
Quoting dr_who
At the moment most of their liquidity comes from Gain (because they are a joint venture of Betfair and Gain)
No, Gain has nothing to with it. Its a jointventure between Betfair and Goldman-Sachs. Liquidity comes from Goldman, JPMorgan and Optiver.

http://mtf.lmax.com/
  • #142
  • Feb 13, 2011 6:31pm Feb 13, 2011 6:31pm
Quoting pip_seeker
........
To say a broker isn't cheating, is likely that you are employed by them. Otherwise what loyalty do you have to a broker? .............


  • #143
  • Feb 13, 2011 6:33pm Feb 13, 2011 6:33pm
Quoting g_otger
anyone know of a good broker that doesnt do that.? what about forex.com?
That is Gain and IMO are at the bottom of most anyone's list.
  • #144
  • Feb 13, 2011 8:26pm Feb 13, 2011 8:26pm
Quoting pip_seeker
I think most of this stuff (complaints in general) come from scalpers. Because if you been in this industry for any length of time you will remember a time when scalpers were the scorn of the industry.

I mean it got so bad the broker would flag your account, making it inoperable. I guess as a way to scold you for "stealing" their money.

Now years later and scalpers are the love joys of the market place. The brokers all welcome them with open arms including scalping EA's. Probably because the brokers software has been updated to defeat the...
Agreed. Brokers are not supposed to be set up as gambling casino dealers where the only way they make profit is if their clients lose money. Scapling is a trading strategy and if it makes money for traders then it shouldn't be considered "stealing money" from brokers.

That's why I believe the most effective way to solve this problem in Retail FX industry is really through ECN's so brokers make money by doing what they are set out to do for their clients, "brokering" transactions between buyers and sellers and be neutral to clients' profits/losses.

But we are yet to see if FXCM, in this case, really did something wrong. Could be this plaintiff, which btw is only ONE guy even though this is supposed to be a Class Action lawsuit which normally would have multiple people as the plaintiff, is just trying to recoup his losses that he incurred for whatever reason at FXCM and is now convinced by his lawyers that he can do so by suing.
Make your losses in demo. Earn your profits live.
  • #145
  • Feb 13, 2011 8:29pm Feb 13, 2011 8:29pm
Quoting shrike
No, Gain has nothing to with it. Its a jointventure between Betfair and Goldman-Sachs. Liquidity comes from Goldman, JPMorgan and Optiver.

http://mtf.lmax.com/
Hmmn interesting to see their spread on majors are not that competitive given that they have those "Big Banks" as their liquidity backers.

The spread on EUR/USD posted on their website is 2-pip wide when most of the MM's spread is only 1 pip. Am I looking at this wrong?
Make your losses in demo. Earn your profits live.
  • #146
  • Feb 13, 2011 8:41pm Feb 13, 2011 8:41pm
Quoting Forexia
That's why I believe the most effective way to solve this problem in Retail FX industry is really through ECN's so brokers make money by doing what they are set out to do for their clients, "brokering" transactions between buyers and sellers and be neutral to clients' profit/losses.

Personally, I don't think there is any magic in being and ECN or not for the simple reason the broker still controls the price you get. The secret sauce is for them to put your mind at ease so they can swindle you.

First it was STP - no dealing desk and now most people say this is flawed for whatever reason and now ECN is the preferred solution.

The only way to get to a true "brokering" transactions between buyers and sellers is to have a centralized market. No price manipulation period. You can sugar coat and put things in any kind of wrapper you want, but if your broker controls the price they still have the ability to cheat.

Cheating can be anything from manipulating price, preventing opening / closing of trades etc. 99.9% of the brokers out there do this to some extent some are worse than others.
  • #147
  • Feb 13, 2011 8:43pm Feb 13, 2011 8:43pm
Quoting Forexia
But we are yet to see if FXCM, in this case, really did something wrong. Could be this plaintiff, which btw is only ONE guy even though this is supposed to be a Class Action lawsuit which normally would have multiple people as the plaintiff, is just trying to recoup his losses that he incurred for whatever reason at FXCM and is now convinced by his lawyers that he can do so by suing.
there has been other people,this guy in 2009 sued them because they offered a different quote from the interbank market about 4 pips different


about forex.com

stay away from them,they are known crooks
min lot size is 10k,they offer 4 digit accountsmso they can keep ur profits
eg.a 3.4 pip move would be 3 pip,u get 3 they get 0.4 plus spread

i was with them before,they were alright ,evrything was good
although it took them 1.5 months to send the the withdrawal check
  • #148
  • Edited 10:46pm Feb 13, 2011 9:23pm | Edited 10:46pm
Quoting pip_seeker
Personally, I don't think there is any magic in being and ECN or not for the simple reason the broker still controls the price you get. The secret sauce is for them to put your mind at ease so they can swindle you.

First it was STP - no dealing desk and now most people say this is flawed for whatever reason and now ECN is the preferred solution.

The only way to get to a true "brokering" transactions between buyers and sellers is to have a centralized market. No price manipulation period. You can sugar coat and put things in any kind of wrapper...
Yeah, but if the brokers can earn commissions just by executing a trade, they would have less incentives to manipulate prices. If they can just sit back and do nothing but pass the prices to all their clients as in their "straight pass-through model", and then earn commission on every trade that gets executed on their system no matter who the client is which is how the broker acts as an ECN does, why would they want to spend more money and manpower to come up with softwares, schemes, servers or whatever to manipulate the prices?

When prices are traded on exchanges, it's going to be the same thing. Unless you are able to have an actual seat on this FX exchange, you are still going to get your prices from your broker. If the brokers are going to manipulate prices in an ECN model, how do you know the brokers won't manipulate prices fed from an exchange?

I don't believe Retail FX industry would ever operate in an centralized exchange because it's in contrary to the essence of the actual product of Forex which is what we are trading here and what the industry is all about. The only reason why the entire FX industry operates through "interbank" networks is because of the anonymity and fluidity of that this environment provides. As much as how commoditized that Forex has become, you still cannot forget what we are trading here. We are trading MONEY itself; that's very different from all the other commodities and instruments that do have exchanges on. All those other commodities, like soybeans and cocoa or stocks, at the end of the day, you are exchanging one product for money. But in Forex, We are basically exchanging money for money. How are you going to create an exchange for money itself?? It's not possible and is not inefficient and not feasible. It's much easier for two banks just to call each other on their dedicated line and say "I will give you this amount of Euro and in return I want this amount of Dollars" and then agree on the deal. And the last thing that they want is for the whole wide world to see how much money they have and how much they have exchanged this Currency X for Currency Y.

It's not so long ago, the entire Forex market is completely forbidden to small investors like you and me. The only players in that market are big corporations who had millions and billions of foreign currency profit to exchange to their home currency or vice versa, large banks who had deposits for conversion and deep-pocketed speculators like George Soros. Unless you have got multi-million/billion dollar assets, they won't even give you the time of the day. The whole FX market is basically a priviledged exclusive private club, you become a member of that club through invitation only. It's only recently with the advancement of Internet technologies and high leverages that we, small investors are offered a chance to basically break into this FX industry and for the very first time, trade on more and less equal footing with the "Big Boys" and now you want them to agree on opening up their books and trades on an exchange?? Not a chance.

That's why I say the closest we can get to achieve transparencies is through the ECN model. We, small investors, one way or the other, are always going to be under-cut but at least in the ECN model, we would be under-cut less.
Make your losses in demo. Earn your profits live.
  • #149
  • Feb 13, 2011 9:48pm Feb 13, 2011 9:48pm
Quoting pip_seeker
To say a broker isn't cheating, is likely that you are employed by them. Otherwise what loyalty do you have to a broker?
This is a question that I have been asking myself ever since Forex Factory has been heavily subsidised by brokers. Why do some posters show such loyalty to their brokers to the point of being anti-trader? The answer is in your quote above that many here are not real traders but broker reps. Funny to see this being posted ad nauseum "people lose money and then blame their brokers" stuff every time someone complains about a broker. And a thread about a lawsuit against FXCM gets turned into newbie traders bashing even though the exact details of the case are unknown. In fact, people blame their brokers for all the dirty tricks like platform freezing when trying to close a profitable position, spread widening, big slippage, stop hunting, delayed execution to cause bad fills, increased leverage with short notice to call margin call and the list goes on.
  • #150
  • Feb 13, 2011 10:26pm Feb 13, 2011 10:26pm
This is the world of OTC trading , u r trading against the broker or the bank , there is conflict of interest , ofcourse brokers could run a good fair business module in OTC trading and it can be profitable without "cheating" but it is the greed , the solution is either trade exchange traded markets or trade long time frames so a slippage of few pips here and there and a platform freeze and a hanging order will not effect your bottom line ...
  • #151
  • Feb 13, 2011 11:14pm Feb 13, 2011 11:14pm
i would say it is bad brokers and bad traders
in a mish mash
  • #152
  • Feb 14, 2011 12:07am Feb 14, 2011 12:07am
Quoting Forexia

That's why I believe the most effective way to solve this problem in Retail FX industry is really through ECN's so brokers make money by doing what they are set out to do for their clients, "brokering" transactions between buyers and sellers and be neutral to clients' profits/losses.
Haven't we already got that with brökers like IB (Interactive Brökers)?

The 'problem' is most of you tightwads expect to trade nickel and dime accounts and get high leverage, tight spreads, instant fills, no slippage, and pay no commissions! You've pretty much got all that yet you still complain when brokers skew price to protect their bottom line!

Jeez, gimme a break......this is trading not charity!
  • #153
  • Feb 14, 2011 6:39am Feb 14, 2011 6:39am
i'm about to withdraw my money 250k not feeling good about this, nobody knows where it ends.
will be looking for some safer broker maybe something in switzerland. i never had big problems with fxcm but can't sleep well when i read such news about my broker.
consistency wins
  • #154
  • Feb 14, 2011 6:45am Feb 14, 2011 6:45am
Quoting iTrader
i'm about to withdraw my money 250k not feeling good about this, nobody knows where it ends.
will be looking for some safer broker maybe something in switzerland. i never had big problems with fxcm but can't sleep well when i read such news about my broker.
citifx pro, you wont regret it
  • #155
  • Feb 14, 2011 7:15am Feb 14, 2011 7:15am
Quoting iTrader
i'm about to withdraw my money 250k not feeling good about this, nobody knows where it ends.
will be looking for some safer broker maybe something in switzerland. i never had big problems with fxcm but can't sleep well when i read such news about my broker.
250
  • #156
  • Feb 14, 2011 7:20am Feb 14, 2011 7:20am
Quoting Forexia
Yeah, but if the brokers can earn commissions just by executing a trade, they would have less incentives to manipulate prices. If they can just sit back and do nothing but pass the prices to all their clients as in their "straight pass-through model", and then earn commission on every trade that gets executed on their system no matter who the client is which is how the broker acts as an ECN does, why would they want to spend more money and manpower to come up with softwares, schemes, servers or whatever to manipulate the prices?
More money, it's already widely available, it's machine employed, the employees they have now would employ the solution.

Let's face it the FX world is not a slacker when it comes to money and the bottom line. Just look at the UBS trading floor picture if you need refreshment.

When you trade are you satisfied with $50 a day? $100 a day?

There has been discussion going on about centralizing the OTC FX market. Remember the little bird that said: "Once they change the allowable Leverage, FIFO, No Hedging, the ones left will be much easier to over come with any new rules."

The government has their hands full with what they got now. Centralizing the FX market takes the broker cheaters out. It's then the same feed across the board no excuses for liquidity feeds acting up or whatever.

This isn't to mean it will happen soon, but it is being discussed.
  • #157
  • Feb 14, 2011 7:27am Feb 14, 2011 7:27am
man we can just trade futures then
if we want a centralised market

or even better orange juice futures contracts
hmm,hmm delicious
  • #158
  • Feb 14, 2011 8:18am Feb 14, 2011 8:18am
Quoting iTrader

i'm about to withdraw my money 250k not feeling good about this, nobody knows where it ends.
will be looking for some safer broker maybe something in switzerland. i never had big problems with fxcm but can't sleep well when i read such news about my broker.
250k with a US bucket shop, lol......and now you're looking at Swiss brokers! Hey why not just put it with a shop in Greece and be done with it, or even better Russia!
  • #159
  • Feb 14, 2011 8:19am Feb 14, 2011 8:19am
Be careful what you wish for, you just might get it.
  • #160
  • Feb 14, 2011 8:25am Feb 14, 2011 8:25am
Quoting dragan53
man we can just trade futures then
if we want a centralised market

or even better orange juice futures contracts
hmm,hmm delicious

Lock Limit / low Liquidity is usually the 2 most profound reasons one doesn't trade the futures market.

These 2 things are absent in forex.

In my humble opinion I would rather eat food than trade it. But to each their own.

This isn't to say I want a centralized market. I just want a fair and honest market, but how do we get there without it? Police and cameras on every corner of the internet?
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