EES: The secret of linear progression in FX exposed

Forex is the largest market in the world and the most widely misunderstood.  For this reason we wrote Splitting Pennies - Understanding Forex - to educate and entertain.  As we explain in the book, in Forex there's things which are possible simply not possible in other markets.  For example, Forex trades all day and all night during the week.  There's no waiting for 9:30 am 'market open' - and while even Forex is closed on the weekends, some brokers offer the ability to trade on the weekends, with a wider spread.  Forex markets offer higher leverage, and unique features such as 'swap' payments, meaning that you are paid to hold positions (or pay, depending on the currency pair and your side of the market, long or short).  Because of the nature of how the Forex market trades, there's a number of strategies that can work on Forex markets that simply can't work on other markets such as stocks, commodities, or bonds.

In Forex it's possible to have a simple linear progression account (function, as equity).  Take this chart as example, it's a real live account statement from the past 3.5 years at a European broker:

Such equity curves simply aren't possible in other markets, without having some kind of advantage (such as HFT).  If we saw equity curve's from prop shops they'd probably look like this.  

How is this possible in FX, and not in other markets?

In Forex there's a number of strategies that are possible that just don't work in other markets.  For example, let's take the strategy 'triangular arbitrage' - this is an arbitrage where there are price discrepancies between 3 currency pairs.  Forex is traded in pairs, i.e. EUR/USD EUR/GBP EUR/CHF.  What can happen during a big market event, for example a failed coup in Turkey as an extreme example, EUR/USD will move faster than it should have to keep in ratio with the rate of EUR/GBP.  That can be just a market function, traders sell EUR/USD before EUR/GBP without algorithms.  Or, large orders can cause the difference between EUR/USD and EUR/GBP to be off slightly.  Even if only off by a fraction of a dollar, this can be millions in profits - hence the name of our book "Splitting Pennies."

How can you participate in it too 

Well, the straight answer is that if you're a retail US investor, you probably can't.  You can buy our book and understand why.   But for the rest of the world, and ECP US Citizens, the strategy is offered as a managed account, as an investment.  Investors open an account with the regulated broker based in London, United Kingdom with a minimum of $20,000 (doesn't matter, US Dollars, Euros, Great British Pounds..).  Investors pay only for profits; there's no fees other than a performance fee of 30% calculated above a high watermark (it's not possible for paying fees to make back losses).  The strategy has a live track record going back 3.5 years with no losing month.  There was a 10% + drawdown during the 2015 Swiss Franc 'event' which was an excellent 'stress test' of the strategy; it recovered and continued to profit (no loss was booked during this event).  

How ECP Americans can participate in it

If you were interested in this strategy and are an ECP (Eligible Contract Participant) defined by the CFTC:

Eligible Contract Participant: An entity, such as a financial institution, insurance company, or commodity pool, that is classified by the Commodity Exchange Act as an eligible contract participant based upon its regulated status or amount of assets. This classification permits these persons to engage in transactions (such as trading on a derivatives transaction execution facility) not generally available to non-eligible contract participants, i.e., retail customers.

..your next step would be to be vetted as an ECP, and proceed to open account.  But the minimum for you would be $1,000,000 - this is similar to the hedge fund account minimum of $1,000,000 - the idea being, outside of being vetted as an ECP, if you can open an account with 1m in cash, you're likely a qualified investor.  Also, as the carrying broker is in the UK, you'll have to report this account on your FBAR, if you don't already have foreign accounts, this is another moving part that you'll have to have your team of advisors dig into.  Many do it, but also many don't.  In fact, many Americans don't even have passports, even rich Americans.  

And frankly, if you are an ECP, you should receive a special status from the Treasury department - like the priority boarding on flights.  All ECPs should be mailed lapel pins from the CFTC they can proudly wear over their Zegna "ECP."  But, we live in a world where only the disabled, minorities, and other degenerates get special priviledges.  

Forex as an investment

This strategy is by no means the only strategy in the world, there are many.  The point is that many of these strategies can't be executed on other markets.  Forex provides a unique market to develop such systems, that can produce linear progression equity curves.  Strategies include statistical arbitrage, grid trading, latency arbitrage, triangular arbitrage, broker arbitrage, matrix trading, least squares trading, momentum oscillator trading, and countless others.

If you want a quick Forex education, checkout Splitting Pennies - the pocket guide designed to instantly make you a Forex genius!

If you want to get started looking at investing, checkout Fortress Capital Forex

Pentagon’s Sloppy Bookkeeping Means $6.5 Trillion Can’t Pass an Audit

The Defense Department over the years has been notorious for its lax accounting practices. The Pentagon has never completed an audit of how they actually spend the trillions of dollars on wars, equipment, personnel, housing, healthcare and procurements.

An increasingly impatient Congress has demanded that the Army achieve “audit readiness” for the first time by Sept. 30, 2017, so that lawmakers can get a better handle on military spending. But Pentagon watchdogs think that may be mission impossible, and for good reason.

Related: Why the Pentagon Budget Is Out of Control

A Department of Defense inspector general’s report released last week offered a jaw-dropping insight into just how bad the military’s auditing system is.

The Defense Finance and Accounting Service, the behemoth Indianapolis-based agency that provides finance and accounting services for the Pentagon’s civilian and military members, could not provide adequate documentation for $6.5 trillion worth of year-end adjustments to Army general fund transactions and data.

The DFAS has the sole responsibility for paying all DOD military and personnel, retirees and annuitants, along with Pentagon contractors and vendors. The agency is also in charge of electronic government initiatives, including within the Executive Office of the President, the Department of Energy and the Departing of Veterans Affairs.

There’s nothing in the new IG’s report to suggest that anyone has misplaced or absconded with large sums of money. Rather, the agency has done an incompetent job of providing written authorization for every one of their transactions – so-called “journal vouchers” that provide serial numbers, transaction dates and the amount of the expenditure.

Related: How the Pentagon Cooks the Books to Hide Massive Waste

In short, the DFAS has lagged far behind in providing the tracking information essential to performing an accurate audit of Pentagon spending and obligations, according to the IG’s report.

“Army and Defense Finance and Accounting Service Indianapolis personnel did not adequately support $2.8 trillion in third quarter adjustments and $6.5 trillion in year-end adjustments made to Army General Fund data during FY 2015 financial statement compilation,” wrote Lorin T. Venable, the assistant inspector general for financial management and reporting. “We conducted this audit in accordance with generally accepted government auditing standards.”

A further mystery is what happened to thousands of documents that should be on file but aren’t. The IG study found that DFAS “did not document or support why the Defense Departmental Reporting System . . . removed at least 16,513 of 1.3 million records during Q3 FY 2015. As a result, the data used to prepare the FY 2015 AGF third quarter and year-end financial statements were unreliable and lacked an adequate audit trail,” the IG’s report stated.

The troubling findings emerged from a wide-ranging audit of the capital funds and financial statements across the military services, including the Navy, the Marine Corps and the Army.

The problem is no secret to investigative reporter Scot Paltrow at Reuters, who exposed outrageous fraud and abuse in a three-part series in 2013 called, “Unaccountable.”

He wrote:

“For two decades, the U.S. military has been unable to submit to an audit, flouting federal law and concealing waste and fraud totaling billions of dollars.

Linda Woodford spent the last 15 years of her career inserting phony numbers in the U.S. Department of Defense’s accounts.

Every month until she retired in 2011, she says, the day came when the Navy would start dumping numbers on the Cleveland, Ohio DFAS…. Using the data they received, Woodford and her fellow accountants there set about preparing monthly reports to square the Navy’s books with the U.S. Treasury’s…. And every month, they encountered the same problem. Numbers were missing. Numbers were clearly wrong. Numbers came with no explanation of how the money had been spent or which congressional appropriation it came from.” 

Related: The 10 Most Expensive Weapons in the Pentagon’s Arsenal

The IG has cautioned in the past that journal voucher adjustments should comply with applicable regulations, which require adequate documentation for each transaction. The June 26 IG’s report made a number of requests and suggestions that DFAS officials and the Pentagon have agreed to go comply with.

The top suggestion is the most obvious one: that DFAS enforce “the applicable guidance” periodically issued by the Under Secretary of Defense Comptroller “regarding journal voucher category identification codes and metric reporting.”

“Until the Army and DFAS Indianapolis correct these control deficiencies, there is considerable risk that AGF financial statements will be materially misstated and the Army will not achieve audit readiness by the congressionally mandated deadline of September 30, 2017,” the report warned. 

http://www.thefiscaltimes.com/2016/07/31/Pentagon-s-Sloppy-Bookkeeping-Means-65-Trillion-Can-t-Pass-Audit

Erdogan Threatens To Abandon US Dollar In Trade With Russia

The unexpectedly sharp antagonism between Turkey and the west accelerated today, and one day after NATO preemptivelyreminded Turkey that it is still a NATO alliance member and advising Ankara that "Turkey’s NATO membership is not in question",Turkey had some more choice words for its military allies. Cited by Reuters, Turkey foreign minister Mevlut Cavusoglu told Turkish's NTV television on Thursday that the country "may seek other options outside NATO for defense industry cooperation, although its first option is always cooperation with its NATO allies." Translation: if Russia (and/or China) gives us a better "defensive" offer, we just may take it.

The sharply worded retort came on the same day that Turkey said it will resume airstrikes on Islamic State targets in Syria, and asked Russia to carry out joint operations against its “common enemy.”  Ankara halted strikes after the downing of a Russian plane by Turkish forces last year.

In the same interview, Cavusolgu said that Ankara “will again, in an active manner, with its planes take part in operations” against Islamic State targets. Cavusolgu also said that Ankara has called on Moscow to carry out joint operations against the “common enemy” of IS. "Let's fight against the terrorist group together, so that we can clear it out as soon as possible,"Cavusolgu said, adding that otherwise IS will continue to expand and spread into other countries.

To be sure, coming from the nation which directly engaged in oil trade with the Islamic State, this is at least a little ironic, however, what is notable is the significant pivot Turkey has made vis-a-vis military engagements, rotating not toward the US alliance, but toward the Kremlin.

"We will discuss all the details. We have always called on Russia to carry out anti-Daesh [IS] operations together," he said, adding that the proposal is still "on the table." The foreign minister went on to tout the benefits of closer cooperation between Turkey and Russia.

"Many countries are engaged in Syria actively. There could be mistakes," he said. "In order to prevent that, we need to put into practice the solidarity and cooperation [mechanism] between us including sharing of real-time intelligence."

The comments came just days after Turkish President Erdogan visited St. Petersburg for talks with Russian President Vladimir Putin, in the first meeting between the two leaders since the plane was downed.

But perhaps the most notable development was reported today by Turkey's Gunes newspaper, which said that as part of the discussion between Putin and Erdogan on Tuesday, the Turkish president suggested to abandon the US dollar in bilateral trade between Turkey and Russia, and instead to transact directly in lira and rubles. This would "benefit both Russia and Turkey", Erdogan allegedly said in his August 9 meeting in St Petersburg, adding that this would relieve the lira from the USD's upward pressure. The reason Erdogan is concerned about exchange rates is because recently Turkish inflation soared by nearly 8% Y/Y, and the recent devaluation of the TRY against the USD has only poured more oil on the fire.

Needless to say, such a bilateral agreement would further infuriate Turkey's European "friends", permanently halting Turkish accession into the customs union, in accordance with Austria's recent demands, and would in turn lead to a dissolution of the refugee agreement that is still keeping millions in refugees away from Europe in general and Germany, and Merkel's plunging popularity ratings, in particular. Which, incidentally, means that not only Erdogan, but now also Putin, holds key leverage over the career of Europe's most important politician.

http://www.zerohedge.com/news/2016-08-11/erdogan-threatens-abandon-us-dollar-trade-russia 

If you want a quick Forex education, checkout Splitting Pennies - the pocket guide designed to instantly make you a Forex genius!

If you want to get started looking at investing, checkout Fortress Capital Forex

For financial institutions, checkout Liquid Claims Securities Settlement Serivces.

Kiwi Soars To One Year High After New Zealand Cuts Rate By To 2.00%

Moments ago, in what would be a very undemonic rate cut, the 667th since the Lehman bankruptcy, the Reserve Bank of New Zealand cut its Official Cash Rate by 25 bps to 2.0% in what was a widely expected move.

This is what the RBNZ said:

Statement by Reserve Bank Governor Graeme Wheeler:

The Reserve Bank today reduced the Official Cash Rate (OCR) by 25 basis points to 2.0 percent.

Global growth is below trend despite being supported by unprecedented levels of monetary stimulus.  Significant surplus capacity remains across many economies and, along with low commodity prices, is suppressing global inflation.  Some central banks have eased policy further since the June Monetary Policy Statement, and long-term interest rates are at record lows.  The prospects for global growth and commodity prices remain uncertain.  Political risks are also heightened.

Weak global conditions and low interest rates relative to New Zealand are placing upward pressure on the New Zealand dollar exchange rate.  The trade-weighted exchange rate is significantly higher than assumed in the June Statement. The high exchange rate is adding further pressure to the export and import-competing sectors and, together with low global inflation, is causing negative inflation in the tradables sector.  This makes it difficult for the Bank to meet its inflation objective.  A decline in the exchange rate is needed.

Domestic growth is expected to remain supported by strong inward migration, construction activity, tourism, and accommodative monetary policy.  However, low dairy prices are depressing incomes in the dairy sector and reducing farm spending and investment.  High net immigration is supporting strong growth in labour supply and limiting wage pressure.

House price inflation remains excessive and has become more broad-based across the regions, adding to concerns about financial stability.  The Bank is consulting on stronger macro-prudential measures that should help to mitigate financial system risks arising from the rapid escalation in house prices.

Headline inflation is being held below the target band by continuing negative tradables inflation.  Annual CPI inflation is expected to weaken in the September quarter, reflecting lower fuel prices and cuts in ACC levies. Annual inflation is expected to rise from the December quarter, reflecting the policy stimulus to date, the strength of the domestic economy, reduced drag from tradables inflation, and rising non-tradables inflation.  Although long-term inflation expectations are well-anchored at 2 percent, the sustained weakness in headline inflation risks further declines in inflation expectations.

Monetary policy will continue to be accommodative.  Our current projections and assumptions indicate that further policy easing will be required to ensure that future inflation settles near the middle of the target range.  We will continue to watch closely the emerging economic data.

There is just one problem with this widely telegraphed rate cut (which promised that monetary police will continue to be accommodative) - it was too widely telegraphed, and the market had fully priced it in (with a 20% probability of a 50 bps rate cut) so much so that instead of weakening the currency, the shorts which had been piling in and hoping for even more from New Zealand central bank governor Wheeler, were disappointed, unleashing a massive short squeeze and stop-triggering cascade,which has as of this moment pushed the Kiwi to the highest level in the past year!

http://www.zerohedge.com/news/2016-08-10/kiwi-soars-one-year-high-after-new-zealand-cuts-rate-200

EES: Magic FX Strategy Launched

Forex trading is difficult; that is to say, opening a Forex account and trading based on price movements, fundamental factors, or market news - is almost impossible.  For this reason the majority of Forex traders rely on some signal system, algorithm, or a professional manager.

The Magic FX strategy is offered to non-US persons and entities ONLY, unless you meet ECP (Eligible Contract Participant) criteria.   For more information, visit www.magicfxstrategy.com

Features of the Magic FX Strategy:

• $20,000 Minimum
• Fully Managed Account
• Clients pay 30% Performance Fee only
• 3 years live track record no losing month
• Average return 1.5% per month
• Broker is licensed with FCA in UK, based in London

DISCLAIMER FOR US CITIZENS:  This strategy and this website is not intended for residents of the United States of America or its territories.  US Citizens and entities are prohibited from investing in this strategy, unless they qualify as an Eligible Contract Participant (ECP) as defined by Section 1a(18) of the CEA (7 U.S.C. 1a(18)).

EES: Get a VPS in Amsterdam

Is your FX broker in Amsterdam?  Get a high quality VPS near your broker's server.  Checkout tradingvps.com - with VPS in London, New York, Amsterdam, & Frankfurt.

EES: The TRUTH about RUSSIA the Elite doesn't want you to know

Just like the good ol' days, Russia is now a useful 'enemy' being used to justify whatever needed from Washington, whether it be more money for NATO expansion, more spying powers on the domestic population, or more reason to justify the USA's generally jingoistic, xenophobic attitude about foreign policy.  As we explain in Splitting Pennies - Understanding Forex - the USA has created a wall of stupidity surrounding the USA via sophistocated propoganda techniques developed over a period of 60 years utilizing advanced technology, combined with bio-chemical layer through aerosol sprays, chemicals in the food, and nervous system manipulation through 1/2 Hz coming from your Television (See US Patent 6506148 here).  

The event that changed the global power structure was World War 2.  History, whether business, technical, political, or social - should be looked at through 3 prisms; before, during, and after the war.  Before & during the war, Washington had a clear agenda - engage the US population & American business in the new hot industry: war.  Hitler provided them with an easy villian and a brand; Nazi.  It was the Evil Empire, something out of a b-novel.  It gave America an easy way to paint the world in a black and white brush for the domestic US population that wasn't aware of how the world really works (pratically speaking, Europeans need to be more clued in and speak 2 or 3 languages due to Europe's density and wide diversity of cultures).

Here's a list of FACTS that the Elite doesn't want you to know.  Everything you know about Russia - is wrong.

• Russia is 25 years old.  
• Russia, and the Soviet Union, are 2 completely different countries.  They are like comparing the British colonies and the United States of America.  It's a different system, different rules, different territory, different everything.   
• The United States developed a long term strategy to destroy the Soviet Union - in order to create Russia today (an open, market based economy).  In other words, Russia today is what Washington had planned for during a 40-50 year period after World War 2, spent billions of dollars, built countless missile silos and other hardware.   
• Russia has one of the fastest growing middle classes in the world See here
• Russia is currently the #3 country ranked in terms of total immigrants in the world, closely behind Germany and the United States.  See here
• Unlike most of European powers, Russia was not a very ambitious or successful colonial power.  The extent of Russia's colonialism was Alaska, but this was really just the business idea of some fur-trappers; it wasn't supported by Moscow very much.  With a few rare exeptions, Russia never 'invaded' another country.  Mostly Russia has defended itself from invaders, at least historically speaking.  Even today, Russia's foreign policy surrounds a 'defense' doctrine, not an 'invasion' doctrine.  Being attacked nearly every 20 or 30 years throughout history, the Kremlin has reason for such a policy.  Why did every Empire throughout history want to invade Russia?  Because of the nice weather?  No, because of the vast untapped resources.  For a more academic answer, checkout Brzezinski's "Grand Chess Board" - certainly Sun Tzu would agree, controlling Russia and North America is necessary for real global domination, for a number of geostrategic, logistic, and economic reasons.
• Russia is an Emerging Market (EM) - Why is it emerging?  Because it's just starting to build economic systems.  In Russia there's no class action litigation industry.  There's no FTC.  There's no bankruptcy rules.  But all that's changing.  Change takes time - it will likely be a generation or several generations.
• The Forex software that runs the algorithmic Forex world, Meta Trader, is from Russia.  Although primarily used outside of Russia, it's built native in Russian language, from Khazan (although headquartered in Cyprus).
• Russia has massive untapped resources unlike any other country in the world, most notably but not only oil.  Russia includes 11 time zones and is one of Planet Earth's most rich and undeveloped land masses, which includes mountains, forests, deserts, tundra, and ice oceans.
• No one is starving in Russia.  In fact, due to the trade war between Russia, the EU, and the United States, they're evenburning and destroying food if it is found to come from blocked countries.

The list can go on and on.  Do your own research - unplug your TV and see what the world looks like.  Open a Forex Account.

See attached photo from a hard currency Foreign Exchange bureau in Moscow (they're on every street corner).  

If you want a quick Forex education, checkout Splitting Pennies - the pocket guide designed to instantly make you a Forex genius!

If you want to get started looking at investing, checkout Fortress Capital Forex

This repost sponsored by LIQUID CLAIMS CLASS ACTION SECURITIES

State Street forex settlement is notch in belt for Madoff whistleblower

The U.S. government finally heard Madoff whistleblower Harry Markopolos loud and clear.

Markopolos, and his whistle-blower group Associates Against FX Insider Trading, were key players in a $530 million settlement announced Wednesday against State Street Bank and Trust Company for allegedly cheating several government bodies on the pricing of their foreign exchange transactions. Markopolos declined to comment.

In a joint announcement on Wednesday the DOJ, SEC, and DOL said that State StreetSTT, +2.67%   will pay $382.4 million, including $155 million to the Department of Justice, $167.4 million to the SEC and at least $60 million to pension plan clients to settle allegations that it deceived some securities custody clients on when it priced foreign currency exchange transactions. The alleged misconduct took place from 1998 to 2009.

The bank also agreed to pay $147.6 million to settle private class action lawsuits filed by bank customers alleging similar misconduct, the Justice Department said.

Markopolos’ group filed its largest forex case originally in California, on behalf of the California Public Employees’ Retirement System and the California State Teachers’ Retirement System. That suit was settled last November. Additional cases filed via False Claims Act whistleblower statutes in Virginia, Florida, New York State and Washington state have also already settled. Markopolos and his group have already been paid for their whistleblower efforts based on those settlements.

The payouts conclude almost all of the investigations State Street has faced since 2009, when Markopolos filed the California lawsuit. Associates Against FX Insider Trading and Markopolos are not named in the latest State Street settlement announcements, but Markopolos has previously acknowledged his involvement in the case.

State Street safeguards clients’ securities as part of its custody business and offers indirect foreign currency exchange trading when clients buy and sell foreign currencies as needed to settle transactions, such as interest and principal payments from foreign bond issuers.

State Street admitted in its settlement with the DOJ that it generally did not price FX transactions at prevailing interbank market rates, contrary to what it told certain custody clients. State Street admitted that FX transactions were marked-up or marked-down from the prevailing interbank rate.

State Street allegedly misrepresented to custody clients that it provided “best execution” on FX transactions, that it guaranteed the most competitive rates available on FX transactions and that it priced FX transactions based on a variety of factors. Instead prices were largely driven by hidden mark-ups that maximized State Street’s profits.

Markopolos has also filed a whistleblower claim in the SEC case. It may be at least two more years before that payout occurs based on similar cases.

See also: Whistleblower award for NYSE fine goes to HFT critic

A State Street Bank spokeswoman said that the negotiated settlement agreements are expected to resolve, subject to the courts’ final approval, the pending litigation and regulatory matters in the United States related to its indirect foreign exchange business.

“Each agreement depends upon certification, for settlement purposes, of a class of State Street’s custody customers that executed indirect foreign exchange transactions with State Street between 1998 and 2009, and final approval by the United States District Court for the District of Massachusetts of the settlement agreement between State Street and the class,” she said. “Matters of this nature can drain both time and resources; so where possible and appropriate we feel it is in our and our clients’ best interests to pursue settlements. Our previously established reserve will be sufficient to cover all costs associated with these agreements.”

Since the lawsuits were filed the foreign exchange markets have gone from an opaque, manual quote market to a fully electronic market where real-time quotes and historical information is available to institutional and retail customers. Every major bank that acts as a forex dealer has its own quoting and execution platform and multi-dealer platforms have sprung up that offer competitive quoting on worldwide currencies.

Checking on rates in advance or verifying after the fact was very difficult to do in the past. Calling around for competitive rates opened a customer up to potential front-running of the trade by other dealers.

He and other whistle-blowers filed a similar case against Bank of New York Mellon Corp. BK, -0.25%   in Massachusetts. A lawsuit filed on behalf of the New York City pension funds by New York Attorney General Eric Schneiderman in 2011 against Bank of New York Mellon Corp for allegedly shortchanging the funds in foreign currency exchange transactions is still pending.

The New York City BONY Mellon suit is the last open forex case for the Markopolos group.

The SEC has already fined Bank of New York Mellon $30 million in June for misleading certain of its custodial clients about pricing when executing standing instructions for foreign currency transactions.

Markopolos spent years on Bernie Madoff’s trail and tried to warn regulators about the fraud, but he was largely ignored. It’s a frustrating experience he documented in his book, No One Would Listen: A True Financial Thriller.

http://www.marketwatch.com/story/state-street-forex-settlement-is-notch-in-belt-for-madoff-whistleblower-2016-07-27 

What If Brexit Doesn't Happen?

Summary

• There's an unlikely, but possible scenario in Britain, where politicians would not enact article 50.
• If Britain doesn't Brexit - what would happen? A GBP reversal?
• Confusion exists about where politicians stand on this issue.

Something not talked about in the mainstream financial news - the nuances of Brexit. The markets seem to think that Brexit is a 'done deal' - the people voted, and that's it. But what if Brexit didn't happen?

Read the whole article on Seeking Alpha

EES: The Forex Monopoly

Forex is a Monopoly, controlled by a small 'cartel' of big banks.  That's changing, and changing fast - as a number of non-bank FX participants are replacing the traditional 'big 12.'  As we explain in Splitting Pennies - the fact remains, if a small group of companies controlled and manipulated the price of any other market, they'd be shut down faster than you can say "Anti-Trust."  

A short list of things that are unique about FX:

• No "Insider Trading" rules.  Yes, that's right!  No insider trading rules.  Don't believe it, confirm it.
• Trades 24/5 - no 'market times'
• People need FX - businesses need currency to operate (People don't need stocks)
• FX is an openly manipulated market (but, each central bank can only manipulate its own currency)

The most important thing stock traders need to understand about Forex

There's a phenomenon in FX we can call ultra high latency information arbitrage.

During Brexit, it took the GBP/USD hours to go down, in total more than 20 hours from peak to valley.  If you missed the first move down, it was easy to catch the 2nd, or the 3rd, or the 4th.  Brexit is the most bright, obvious example but not the only one - it happens nearly every week. 

Coup in Turkey?  Risk on.  Failed coup?  Risk off.

In the stock market, when there's news, not a moment goes by that the market absorbs it.  In fact, the information knee-jerk in stocks is so quick and usually so severe, traders have strategies designed to buy into the panic information leak selling.

It's not possible to trade on information in stocks because it happens so quickly, even if you use algorithms and subscribe to Reuters 'ultra low latency' data service, there's almost no opportunity there.  But in FX, it can take the markets tens of hours to absorb PUBLIC information.  No one had 'insider' knowledge about Brexit.  GBP/USD went down slowly, very slowly, over a period of many hours.  Spreads widened, but not to levels that would impact trading. 

But with FX, there's good news.  You don't need to own the FX Monopoly, to generate some Monopoly money.  But in FX, you can take your profits and spend it in your local shop (Children, don't try to spend Monopoly money, it's illegal).  FX - it's like the Monopoly for adults!

If you want a quick Forex education, checkout Splitting Pennies - the pocket guide designed to instantly make you a Forex genius!

If you want to get started looking at investing, checkout Fortress Capital Forex