Wednesday, July 8, 2009

FXDD responds to FOREX Witch Hunt

By now you are probably well aware that NFA has made a new rule that prohibits US Forex Dealer Members from carrying customer accounts with opposing positions in the same account past the end of the trading day ("no -hedging"). The rule also requires all positions to be closed in historical order, otherwise known as 'first in first out' (FIFO). There has been wide speculation among user groups what these changes may bring, how they are going to affect the Metatrader platform, how automated trading scripts are going to be affected (Expert Advisors) and what retail trading is going to look like in the future.
The 'No-Hedging' rule has been in effect for over a month now and as many of you can attest most of the statements of "doom and gloom" have been highly exaggerated. The FIFO rule implementation has been extended once already and there is continuous talks amongst all companies, platform vendors (software companies), and NFA as to what will be permitted and how things should be working out. In the midst of these changes some dealers have decided to use the rule changes as a selling point for their offshore service centers. They try to amplify the uncertainty and to play on the customers' fears. It is unclear if they are well equipped to maintain a properly operating MT4 platform in these jurisdictions. Most of them have very little history of operating one. It is certain though that it would be costly and inconvenient to close everything and move an account to an untested firm.
In the wake of all this speculation we at FXDD would like to assure you once again that we will do our best to make sure you can continue trading without having to worry about how things may change for you. We are working with the platform vendors, carefully examining all possible options, and working diligently with NFA on the progress of our membership. Our advice is not to make hasty assumptions based on the loose talk from people who spread rumors. If we are to make any further changes to our platforms we will make sure you are informed well in advance and you are given all possible options to consider. We will also try and keep you updated on a regular basis to let you know what our plans are.

Thanks as always for being a FXDD customer.

The FXDD Team

75 Park Place, 4th Floor, New York, NY 10007
Toll-free in the US: +1-866-367-3933 or +1-212-791-3933.