Trump and USA traders

[GazFx]

What does Trump's election mean to traders in the USA? Will our US counterparts once again be free to trade whenever, and with whoever they choose? Will they have freedom of leverage? Will they be able to hedge? It should be interesting watching what evolves out of this!

 

[hayseed]

it will probably have no effect, + or -..... our broker choices are limited and will probably stay so, but 2 is enough...... we have become used to low leverage, 50:1 is plenty.... we can get around the no hedge rule with multiple accounts, if need be....

over regulation is small hill compared the mountain of self discipline a trader must climb.....h

 

[Enivid]

Well, if Dodd-Frank gets repealed, you might expect a lot of Forex brokers popping up in the USA and trading conditions returning on par with those in other countries.

 

[hayseed]

Well, if Dodd-Frank gets repealed, you might expect a lot of Forex brokers popping up in the USA and trading conditions returning on par with those in other countries.

//----

hey enivid..... perhaps..... but in regards to forex trading, the dodd-frank bill really has done no true harm..... at least from my point of view...... it did clamp down hard on some shady brokers..... lowering leverage was probably a good thing.... the no hedge rule is only a slight inconvenience..... the fifo rule is the only real pain....

conditions are quite good here.... and the handful of sites, such as yours, that promote trading education make it all the better.....

we've come a long way since mq3......h

 

[Enivid]

I think that trading conditions brought by Dodd-Frank (no hedging, lower leverage) are overall beneficial to the market. However, the decline in competition among brokers is a bad thing. How many there are now? Oanda, FXCM, and GAIN?

 

[hayseed]

How many there are now? Oanda, FXCM, and GAIN?

//------

hey enivid..... nfa shows 3 registered members...... oanda and fxcm for sure, i use both those..... and have no problems worth mentioning with either.....

we can use non nfa registered brokers over here even though it's commonly thought we can't...... i've personally called nfa several times and asked for clarification.... and they have called me several times leaving voice mails which i've saved.....

they made it clear they strongly advised against using non member brokers but there is no law being broken if we do.... they repeated 'strongly advised against' multiple times..... but openly admitted we could use offshore brokers....

trouble is most of them won't use us.....h

 

[Enivid]

Yes, the limitations are not on the US citizens but rather on the companies. Offshore companies do not take US residents because they know that they will get sued by CFTC (as InstaForex has been, for example). Still, my point stands. Higher competition will lead to a better market for retail traders albeit with poorer protection.

 

[Jason Rogers]

I think that trading conditions brought by Dodd-Frank (no hedging, lower leverage) are overall beneficial to the market. However, the decline in competition among brokers is a bad thing. How many there are now? Oanda, FXCM, and GAIN?

Hi Enivid,

When I started working at FXCM almost 12 years ago, there were over 30 retail forex brokers in the US, but now only a few remain. The reasons are often actively debated on forums.

One thing I would point out is how regulatory capital requirements have increased over the years for US forex brokers and how they now compare to capital requirements for futures brokers:

• $20 million minimum for forex brokers (AKA Retail Foreign Exchange Dealers)
• $1 million minimum for futures brokers (AKA Futures Commission Merchants)

 

[wisetrada]

Quite surprisingly many people thought a Trump victory would terribly pull down the dollar but so far this is not the case as the dollar has risen to unprecedented peaks since the victory of Donald Trump.

 

[Enivid]

One thing I would point out is how regulatory capital requirements have increased over the years for US forex brokers and how they now compare to capital requirements for futures brokers:

The high capital requirements killed off some of the smaller brokers, but it is not a very new requirement. $20M minimum capital alone would not decrease the number of RFEDs in the industry to the current state.

 

[Jason Rogers]

Quite surprisingly many people thought a Trump victory would terribly pull down the dollar but so far this is not the case as the dollar has risen to unprecedented peaks since the victory of Donald Trump.

You make a great point, Widetrada

People we also predicting US stocks would tank if Trump won, but the major indices just had their best week in 5 years with the Dow reaching new all time highs. This is an example of contrarian trading and a key reason why I look to the Speculative Sentiment Index (SSI) as a contrarian indicator for currency pairs.

 

[Jason Rogers]

The high capital requirements killed off some of the smaller brokers, but it is not a very new requirement. $20M minimum capital alone would not decrease the number of RFEDs in the industry to the current state.

You're right, Enivid

While the smaller brokers dropped out after the $20M minimum capital requirement was introduced, the latest news to impact the number of US forex brokers was this: https://www.leaprate.com/2016/05/sec-notice-bans-broker-dealers-from-retail-forex/

On May 20th of this year, the US Securities and Exchange Commission (SEC) announced that as of 7/31, regulated Broker-Dealers are prohibited from offering retail forex trading. The prohibition also applies to Broker-Dealers who are dually registered as a Futures Commission Merchant or a Forex Dealer Member, such as Wedbush Securities, Interactive Brokers and Phillip Capital. Phillip Capital decided fairly quickly to halt its retail forex operation altogether in the US. Based on recent statements, it appears Interactive Brokers has been similarly affected.

By contrast, FXCM and the other remaining forex brokers in the US are registered as Retail Foreign Exchange Dealers with the CFTC, but not registered as Broker-Dealers with the SEC. Therefore, they are not impacted by this SEC prohibition.

 

[Fatim]

President election help me to earn money on usd/eur pair. My broker LiteForex inform me about volatility