Here We Go Again, Not Another Broker!

I have been trading since October, 2007, and now I am faced with finding a new broker…again!

What is it with forex brokers? I guess they are like traders, they come and go.

I started out with GFT, Global Forex Trading. At the time, they were recommended by my forex instructor as a viable broker because of their financials. Eventually, in 2012 they had to pull out of the United States market because they didn’t have enough capital requirements to continue business.

Try doing a Google search for them now. I spent a minute and could not find their website. I guess they are gone.

Today, I closed my FXCM account. As I am writing this post, they are publically traded on the Nasdaq stock market. When I chose them, I thought this was a big plus, never thinking that they would cease business in the US.

But in February 2017, they announced that they are stopping business in the US, because of CFTC violations including under-capitalization and concealing close ties to a market maker who received favored treatment.

The company also lost about $200 million on 1/15/2015 when the Swiss National Bank lifted the cap on the Swiss franc’s value against the euro dollar. They had to borrow $300 million to stay in business.

Their stock has been declining and lost 50% of it’s value since the announcement. Today I read an article about how they are going to save money by not being in the US market. That’s probably true for now, but if I were an overseas trader, I would start looking for a new broker. Look what happened to GFT.

Because FXCM is selling their US business to Gain Capital, Forex.com, I decided to not give FXCM the $500 transfer fee that Gain Capital is going to give them for my account, by closing it.

But wanting to get back into the game right away, I opened a demo and real account with Forex.com. They are traded on the NYSE stock market and actually made money on the 2015 franc / euro dollar drop. Their charting platform has 10 minute candles, my most important requirement. I demo traded for an hour or so then opened a real account.

But I didn’t demo trade and observe close enough. Everything looked good on their charts, but I didn’t notice how long their candles lag when a new one opens. I timed one of them, it was almost 3 minutes after the previous 10 minute candled closed. How are you supposed to trade off of candles with that much lag?

I chatted with one of their representatives, and he said that is normal. What?!! That’s normal?

I am the ignorant one for wanting to get back in the game so soon without closer inspection.

So now I have to close my account with Forex.com and open one with Oanda. I downloaded fxTrader, their trading platform, and it has everything I need for trading. I’m using the advanced charting.

Oanda’s demo charting is spot on with FXCM. My FXCM account is zeroed out but is still working, so I compared charts side by side.

Will Oanda eventually fail? Who knows. They have been around since 2001, and are registered with the CFTC, FDM, and NFA. This requires them to have a certain amount of capital on hand to be a broker. I guess time will tell.