Comments on: FXCM UK Increase Margin Requirements

By: Jim

Jim — Tue, 01 Feb 2011 12:25:44 +0000

Hi William, My comment was made back in February 2010, and quite a lot has happened since then! As I keep on saying, I'm no lawyer. However I believe the new (October 2010) regulations have closed that particular "loophole" in much the same way that Jon was predicting. The relevant bit says that "retail customers" include:

Companies, other than financial institutions and investment companies, with less than $10 million in total assets, or a net worth less than $1 million if entering into the transaction in connection with the conduct of their businesses.

Jim

By: william keenan

william keenan — Tue, 01 Feb 2011 06:06:34 +0000

How would I set up a corp ent to get around margin req. please give an example. Not that I would do it I am just curious. Thx in advance

By: Jim

Jim — Fri, 12 Feb 2010 16:49:57 +0000

Hi Jon,

I'm not as certain as you seem to be that MetaQuotes will have been bankrolled by the NFA!

If you're smart you can also set yourself up as some sort of corporate entity to get around the "US citizen" restrictions.

Jim

By: Jon

Jon — Fri, 12 Feb 2010 14:50:44 +0000

Only the questionable firms in questionable jurisdictions
will continue to offer 1:500 nonsense leverage with
minimal deposit of $5 to open an account. But
serious firms in UK will offer 1:100 and 1:200 forever.
Now, I am sure CFTC and NFA will try to strongarm
FSA to follow suit or the next move would be to make
it illegal for US citizens to go offshore to do forex.
This won't stop smart people. You simply find a
friend in UK and open the account in that person's
name and address and you trade it yourself. No
other nation will let NFA dictate crap to them.
Even if they ask that they disallow US citizens
from opening accounts with them. They will all
protest stronger. It is now painfully clear that
NFA paid a hefty sum to MetaQuotes to develop
MT5 platform.