CFTC Leverage change to 10:1 in the US?...What do you think?

Im glad Im not an American, I feel for you guys,
but you can allways trade options, then it will not affect you,
you can chose whatever leverage you want.

I agree with you there. We can’t deny it that regulation is almost doing more harm than good. Yes regulation is good, but it is really hurting the market, last year the US lost millions to brokers who pulled offshore to escape the suffocating jurisdiction onshore. Go and see the very close relationship between the CFTC and White House and see the big political interest of govt in the forex; must times, regulatory pronouncements are well aimed at protecting the “big” traders and the Wall street. I have not really seen any petty trader who is comfortable with the FIFO; most people are happily now trading offshore.

And aside from all the harm that it’s doing to the industry AND investors, this ridiculous regulation is NOT even doing what it was set out to do, protecting the investors. Leverage rate is NOT what’s making investors losing money. 1) Lack of trading and money management skills/education/training and 2) Unscrupulous brokers are making investors losing money. You think with the current leverage rate, if investors trade with no money management skill and/or sign up with Fast Profit Forex based out of Nigeria (which is where the investors are actually flocking to due to the unreasonable regulations in the US), they will not lose money? Even with 0 leverage rate, if the investors don’t know how to trade and/or they sign up with scam brokers they will still lose money. Plenty of investors lose money on mutual funds and ALL of the investors lost their money when they traded with Bernie Madoff and yet ALL of them trade(d) on cash, NO leverage (well except until the very end when the scheme was on the verge of collapsing). Is CFTC or SEC going to shut down all the mutual fund companies then? And what did the SEC do during the NINE years that the whistleblower Harry Markopoulos was telling them to investigate Bernie Madoff? (I’ll give you hint: It rhymes with Nero)

You want to regulate an industry? Do some studying and research and find out what really needs to be regulated and come up with rules and regulations that are relevant and effective, otherwise stay the hell out!! We investors are NOT stupid and don’t need some Big Brother watching over our shoulders.

I agree with everything you wrote , I don’t like that fifo either. I had to change some my strategies.

By now you must have understood that high leverage is not the cause of account blowout by noobiees. High leverage is a very good thing for those with limited capital. So, the regulation has really caused us to miss some good things in forex and it is nothing to be happy about.

How can retail traders meet up to this If some of them do not have sufficient fund to go with? I thought the use of leverage is to help traders with no much funds to start up. It sounds complicated somehow that their leverage there is 1:10, that means much capital will be required to invest on this transaction. Well, I’m happy that my broker allow the use of leverage from 1:1 to 1:500 any time feel like.

1:10 means that for someone to open a 1 standard lot trade they need 10 000$ in equity which is lol :smiley: What are they trying to do, make you trade mini and micro lots with nothing less than 50-100 000$ account… I fail to see the point in logic…

The fact this NFA rule capping leveraging with 100: 1 only travelled in to impact by the end involving December leans clearly for this CFTC not really producing items any further hard to stick to any moment rapidly.

But it helps preventing novice traders blowing up their newly funded account within a day (which happened to me twice in the past). This is a business where people come in who know absolutely nothing about trading, leverage, margin etc. It might be patronising but patronising is sometimes necessary.

You know there is that trading Forex, CFDs etc. is risky label so anyone not reading that and not familiarizing themselves with trading should go to doctor to have them checked out. It’s like driving a plane without reading manual… But than again I’m glad I’m not in the USA…

Geez kid how about a demo account? You blew two accounts? In 1 day each? HOW?!

I wonder if the lottery will have a max buy in now. Since the odds of winning aren’t displayed clearly for some moron. That’s what I’ll do today, buy a lottery ticket. When I most likely lose I’ll call a lawyer and say I had no idea how slim my chances were of winning. Then we’ll sue the lottery.
Ugghhh where the F are you reality?!

Agree with your posts…

Leverage should work for our advantage. Those who do not know how to use leverage should not use it at all. Those who blow out their account should be allowed to do so… it’s their money lols

Smoking kills… yet how many people commit slow-over-the-years suicide? lols :smiley:

Maybe it’s better to just trade ES if the trader is a U.S. citizen?

I think we should be able to leverage just like any other part of the world

[B]This thread became obsolete more than 4 years ago,[/B] — when the CFTC lowered the MAXIMUM ALLOWABLE LEVERAGE in U.S. forex accounts from 100:1 to 50:1.

50:1 — not 10:1.

And yet, forum members who apparently don’t know the facts come onto to this thread giving their opinions about “the 10:1 leverage limit in the U.S.”, without realizing that [B]no such thing exists, or ever has.[/B]

The fact that this thread has been given the special distinction of “Sticky” — meaning that it stays forever at the top of the page, in obvious plain sight — simply perpetuates the useless debate over the 10:1 leverage limit.

The premise of this thread is no longer valid. It’s time for this thread to be retired.

Babypips Admins: Please un-stick this thread, and let it sink out of sight.

thanks for the posts guys. As i am new here and i tried many things to learn the best strategies for keeping up my forex work

Stupid move. That would be the downfall of US brokers as we know them. All retail traders would go foreign. You would need $10,000 to trade a full lot. Required minimums would go way up. Literally one of the stupidest things I’ve heard of. Just making it harder for lower income people to move up the ladder.

You can try School of Pipsology | Learn Forex Trading to improve your Forex knowledge :slight_smile:

1:10 is not alot as the forex market trades in the order of 0.0001, the more leverage the more money needed.

10:1 is ridiculous
Too small a leverage just drives people away.

Ever heard about BlackJack gambling. Well, new rules were made alright. To say, it is to protect the players would be a great laugh.

Rules are made for the house. If people ain’t making money in forex, there is always the stock market, commodity market, etc…

Leverage is a double edge sword, but used correctly by educated traders/players can be really profitable. In the end, survival is the real key. I don’t care how you leverage or how you risk, if you can survive and profit, thank a TEACHER. Without proper education, all dumbass money would go to the smartass.