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CFTC to limit leverage in OTC Forex to 10:1
By Iman || January 16, 2010 at 10:37 GMT
|| 16 comments || Add comment
They’ve just come out with a proposal with several regulations, some good and some bad, but the worst of them is the limit on leverage; that would undoubtedly vanquish the retail Forex trading.
head to their site for more details: http://www.cftc.gov/newsroom/generalpressreleases/2010/pr5772-10.html
saw this mentioned somewhere the other day. its been clear for a few months now that they seem intent on killing off retail forex trading by introducing ridiculous new rules and using feeble excuses about protecting traders. looks like retail forex is going to be moving in its entirety to the uk, assuming they dont introduce the same ridiculous rules.
Then do comment on your feelings to the cftc. I’m going to.
Ways to leave comments with the cftc-
Federal eRulemaking Portal: http://www.regulations.gov/search/index.jsp. Follow the instructions for submitting comments.
E-mail: secretary@cftc.gov. Include “Regulation of Retail Forex” in the subject line of the message.
Fax: (202) 418-5521.
Mail: Send to David Stawick, Secretary, Commodity Futures Trading Commission, 1155 21st Street, N.W., Washington, DC 20581.
Please make your opinion known to the cftc, if you’re displeased with this proposal. If traders fail to have their feelings known, then the cftc’s decision, is much easier to make.
I have a template letter for anyone that wants to email secretary@cftc.gov (although this thing seems to remove all formatting including line spaces so will probably look a mess)
To whom it may concern,
I am a retail trader and I am strongly opposed to the 10:1 leverage proposal by the CFTC. This regulation/requirement will drive many of the “smaller guys” out of the markets entirely or to offshore (ie unregulated) brokers.
The liquidity provided by retail traders increase the efficiency of the markets. Removing them, or unfairly pricing them out of the markets will result in increased price volatility overall and decrease the efficiency of the markets which is bad for everyone.
Please reconsider this proposal.
Thank you
Sign Your Name Here
anyone using that template, dont forget the subject line of the email should read “Regulation of Retail Forex” as Michael says.
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No worries, you can always move your accounts offshore … that will decrease the Dollar value resulting from the outflow, what is the CFTC thinking … no idea
Here is an idea for a minimum trade … say the leverage is 1:10, you need minimum capital of one thousand dollars, you type in your lot size at 0.01 and you will get one dollar per pip, your Margin Level will be at around 500%
Another idea … leverage 1:10, you have capital of USD40K, you can type in your lot size at 0.20 which will give you twenty dollars per pip and your Margin Level will be around 1000%
If I understand correctly, isnt the new proposal for SPOT FOREX and not currrency futures ( ie 6E, 6A, 6J etc)??
Thanks
Dominic
not calling for it, but it reminds me of something that Jim Rogers said ‘the last thing you see before a collapse is all sorts of controls on capital’
Heard that the CFTC gonna restrict trading on Gold as well
… that was why EURUSD went downhill on Friday along with rumours Merkel resigning
Sheesh. If it isn’t the U.S. politicians already making me feel like Michael Douglas in that movie “Falling Down”, along comes over-regulation to make me more annoyed. lol! Here lately, i’ve been thinking about moving my family out of the U.S.
…just bought the collectors edition of that flick.
Yeah, it’s a good movie. I should say that I feel the way he felt, up till the point you realize he’s a wacko and is getting what he deserves.
Vicarious