CHF Black Swan: The Winning Broker is... | Forex Factory

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CHF Black Swan: The Winning Broker is...

  • #1
  • First Post: Jan 18, 2015 9:54pm Jan 18, 2015 9:54pm
gain capital: It make between $5-10M from this event.

Most brokers lose, only forex.com make a lot money from SNB black swan. They are really amazing special one.
You get FXCM suffer $225M loss because they hedge clients position.
but can you understand forex.com made $5-10M from that event?
They bet with you!!! You blow-off money goes to Forex.com. That's why they are winner. This time they don't say it is off-market, just because they make money. If they lose, you guess what they will do. They will say it is off-market and can easily post-adjust your account fund.
Gain never lose, its clients will lose always.

Loss list of brokers
http://forexmagnates.com/forex-indus...-time-updates/
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  • #2
  • Jan 18, 2015 10:39pm Jan 18, 2015 10:39pm
Hi Yunben, I do not quite understand your statement. U said that FX broker hedge against client so they are losing on past CHF surge. Clients could be buying or selling during that time. If majority of the clients is selling CHF means hedging broker is buying at the same time, broker will profit. If the opposite case happened, then broker lose money. Would you please explain what i understand wrong?
  • #3
  • Jan 18, 2015 10:53pm Jan 18, 2015 10:53pm
Quoting gristar
Hi Yunben, I do not quite understand your statement. U said that FX broker hedge against client so they are losing on past CHF surge. Clients could be buying or selling during that time. If majority of the clients is selling CHF means hedging broker is buying at the same time, broker will profit. If the opposite case happened, then broker lose money. Would you please explain what i understand wrong?
what you describe is Market Maker Broker or in same cases I'd like to refer them as Casino Broker. They make money if you lose money, if you make money they will cancel your profit so they will not lose money.

In the case of FXCM and Alpari, they are ECN broker, so all trader order is sent to Liquidity Provider. ECN broker only make money from the spread.
  • #4
  • Jan 18, 2015 11:00pm Jan 18, 2015 11:00pm
Quoting gajebo
{quote} what you describe is Market Maker Broker or in same cases I'd like to refer them as Casino Broker. They make money if you lose money, if you make money they will cancel your profit so they will not lose money. In the case of FXCM and Alpari, they are ECN broker, so all trader order is sent to Liquidity Provider. ECN broker only make money from the spread.
As you said FXCM, Alpari and other regulated broker are ECN , but why they get lost in this case? thanks for your information .
  • #5
  • Jan 18, 2015 11:17pm Jan 18, 2015 11:17pm
Quoting ronald_fsm
{quote} As you said FXCM, Alpari and other regulated broker are ECN , but why they get lost in this case? thanks for your information .
because a lot of the clients who incured huge negative account balance won't/can't pay up. The clients who were on the winning side of CHF trades are obviously excpecting brokers to come through and pay up. where's that money going to come from when clients file for bankruptcy.
  • #6
  • Jan 18, 2015 11:20pm Jan 18, 2015 11:20pm
Quoting ronald_fsm
{quote} As you said FXCM, Alpari and other regulated broker are ECN , but why they get lost in this case? thanks for your information .
because due to the gap in CHF, most client could not close their trade with their Stop Loss Order, and it get worsed when the order could not close within traders deposit amount. Usually if trader lose certain percentages of their account, trader would got Margin Call, but in CHF case this did not happen.

So many trader got into negative balance in their account. Since broker could not ask the trader to pay this negative balance, ECN broker would eat up this loss. Sum of the loss is what make them got into the trouble.

Note that this is a rare event, in usual trading day, client would got Margin call before their account got to zero balance.

That's why I would say, you've got to careful with those offshore broker who stay calm and even could make money in the CHF event.

Like I said, with casino broker, They make money if you lose money, if you make money they will cancel your profit so they will not lose money.

Quoting BubaYaga
{quote} because a lot of the clients who incured huge negative account balance won't/can't pay up. The clients who were on the winning side of CHF trades are obviously excpecting brokers to come through and pay up. where's that money going to come from when clients file for bankruptcy.
Like what BubaYaga says
  • #7
  • Last Post: Jan 19, 2015 12:59am Jan 19, 2015 12:59am
Quoting gajebo
{quote} because due to the gap in CHF, most client could not close their trade with their Stop Loss Order, and it get worsed when the order could not close within traders deposit amount. Usually if trader lose certain percentages of their account, trader would got Margin Call, but in CHF case this did not happen. So many trader got into negative balance in their account. Since broker could not ask the trader to pay this negative balance, ECN broker would eat up this loss. Sum of the loss is what make them got into the trouble. Note that this is...
Thanks for your kind reply. good luck on your trading. How about the trader who buy chf ,could they take those profit or the broker cancel their profit?
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