FXCM Announcements

[Jason Rogers]

Hi Everyone,

This thread is where I will post any new announcements from FXCM such as platform updates, changes to trading hours due to holidays, new products, etc. This way it will keep everything in one spot rather than having to create a new thread for each announcement.

Cheers,

Jason

[Jason Rogers]

MT4 Announcement (April 19, 2011): All new MT4 accounts with FXCM US (LLC) are being setup with the ability to trade micro lots. If you have an existing MT4 account with FXCM and would like to trade micro lots, please contact client support to have it enabled.

Let me know if you have any questions.

-Jason

[Jason Rogers]

Important information on changes to trading hours due to the Easter holiday:

There are no changes to forex trading hours. Trading closes on Friday at 4:00pm ET (20:00 GMT) and starts again on Sunday at 5:15pm ET (21:15 GMT)/

CFD Trading hours will change from Thursday, April 21 to Tuesday, April 26 for some CFD trading instruments. Below is a list of the changes to trading hours for the CFD products. All times are in GMT.

Please Note: Oil, metals, and indices trading is not available to residents of the USA and its territories.

[Jason Rogers]

Updated USD Margin Requirements 4/29/2011: This information was sent to all FXCM US and FXCM UK accounts denominated in USD. Please be aware in case you have not read the email (We know how distracting the Royal Wedding can be). Margin requirements for USD denominated accounts will be adjusted at market close on Friday, April 29th due to recent price fluctuations in the US Dollar. It is important to monitor your usable margin closely, making sure it does not fall below zero. Here is a table of the new margin requirements for accounts on 200:1 leverage with FXCM UK when trading a mini lot of 10k for the specified currency pair:

If your account is with FXCM US, multiply the amount by 4 to get the margin requirement for a 10k lot at 50:1 leverage. Last week I mentioned that micro lots are now automatically available for all new standard 10k accounts setup with FXCM US. If you have an existing standard 10k account with FXCM US and would like the ability to trade micro lots, please contact client services with the request.

At present, FXCM does not anticipate that margin requirements will have to be changed more than once a month. Up-to-date margin requirements are and will continue to be displayed in the “Simple Dealing Rates” window of the trading platform, by currency pair.

[Clint]

Hello, Jason

If I read your table correctly, for U.S. customers who have 50:1 leverage, margin requirements on the GBP/USD
(my weapon of choice) will increase to:

$36 per micro-lot (from $34)

$360 per mini-lot (from $340) and

$3,600 per standard lot (from $3,400)

Do I have that right?

[Jason Rogers]

$36 per micro-lot (from $34)

$360 per mini-lot (from $340) and

$3,600 per standard lot (from $3,400)

Do I have that right?

Hi Clint,

Yes, that is correct.

-Jason

[Jason Rogers]

We're happy to announce that FXCM has partnered with Dow Jones Indexes to release the Dow Jones FXCM Dollar Index (USDOLLAR)!

The Dow Jones FXCM Dollar Index Basket allows you to take advantage of the US Dollar appreciation and depreciation. Do you believe the US dollar is likely to appreciate? You can buy the DJ FXCM Dollar Index Basket and benefit if it gains against four currencies.
Think it will head lower? Selling is just as easy.

The Dow Jones FXCM Dollar Index is composed of 4 currencies in equal weightings.

The Dow Jones FXCM US Dollar Index avoids outdated currency pair selection and confusing methodology to produce a more straightforward design. The index basket is designed to be as easy to understand as it is to trade. At inception date, the index reflects an equivalent $10,000 long position against the euro, British pound, Japanese yen, and Australian dollar. The value of the index is subsequently the average value of those US Dollar positions. If the US Dollar rallies 100 pips against the euro, Australian dollar, Japanese yen, and British pound, the index will appreciate by approximately 100 points.

Trading the Dow Jones FXCM Dollar Index Basket

The USDOLLAR symbol was added to demo accounts with FXCM LLC yesterday, and the symbol should make it onto all demo accounts this weekend. If you don't see it in the dealing rates window, you can add it by clicking on the Symbols button at the top of the platform. If you don't have a demo, then click on the button below to register:


I've been told that the charts may possibly be backfilled by this week. In terms of live trading on the index, it will be added to live accounts eventually.... possibly within a couple of months but still not certain. The index can also be found on most financial websites by searching for the ticker symbol USDOLLAR, i.e. Yahoo Finance.

Here is what it will look like once added to the dealing rates window:

The screenshot of the USDOLLAR basket is from yesterday when the index value was at $9,440. This is the USD value of the 4 currency pairs in the basket. Since the initial starting value of the index was $10,000 you can see that the US Dollar has lost value since the index was initially launched. The current USDOLLAR value is around $9,504 (as of a few minutes of the post) so you can tell that the USDOLLAR has gained in value since yesterday. The new index allows you to easily speculate on the direction of the dollar versus a basket of pairs. Let me know if you have any questions.

-Jason

[Clint]

Hello, Jason

That's a very interesting new product!

Three questions:

Since this index will be traded through the FXCM platform, and client positions will presumably be offset through your liquidity providers, it seems like FXCM could run this index without the involvement of Dow Jones. What role will Dow Jones play in all of this?

How closely is this new index correlated to the standard U.S. Dollar Index?

Initially, this product will be available in demo accounts only. Is that a way of beta-testing the product, or just practice time for interested traders?

[Jason Rogers]

Hello, Jason

That's a very interesting new product!

Three questions:

Since this index will be traded through the FXCM platform, and client positions will presumably be offset through your liquidity providers, it seems like FXCM could run this index without the involvement of Dow Jones. What role will Dow Jones play in all of this?

How closely is this new index correlated to the standard U.S. Dollar Index?

Initially, this product will be available in demo accounts only. Is that a way of beta-testing the product, or just practice time for interested traders?

Hi Clint,

The basket will be a tradeable instrument with FXCM possibly within the next couple of months. FXCM could have created the instrument without the help of Dow Jones, but Dow Jones is arguably the worldwide leader in index products. Forex traders know FXCM whereas nearly everyone knows Dow Jones. Whenever you watch the news you see the DJIA (Dow Stock Index) quoted as the index to watch. Partnering with Dow Jones also makes the index easy to find since it will be included on nearly every major financial website.

The current dollar index you are most familiar (DX-Y.NYB) is very euro-centric. It was created back in the 1970's, and the index is tilted towards euro area countries by almost 64% if you count the percentage make-up of the EUR, CHF, and SEK. The Dow Jones FXCM Dollar Index seeks to balance this out by including the Australian Dollar to represent commodites and Asia Pacific growth. The index is comprised of the 4 top traded currencies against the dollar: Euro, Japanese Yen, British Pound, and Australian Dollar. Why would the current USD index include the SEK (no offense to traders in Sweden )? The goal is to include currencies most relevant to the value of the dollar without making it overly complicated. Each currency is evenly divided to make up 25% of the basket.

It is also easy to calculate the value of the index since the index represents the equivalent of $10,000 long position against the EUR, JPY, GBP, and AUD. As far as correlation...creating a correlated index was not the objective. The objective was to create something relevant to current market conditions while being easy to understand.

The index was launched in the demo for both beta testing and to allow interested traders the opportunity to practice trade it. Both of the reasons you listed are correct.

-Jason

[Clint]

...nearly everyone knows Dow Jones.

Partnering with Dow Jones also makes the index easy to find since it will be included on nearly every major financial website.

As far as correlation...creating a correlated index was not the objective. The objective was to create something relevant to current market conditions while being easy to understand.

The index was launched in the demo for both beta testing and to allow interested traders the opportunity to practice trade it.

Hi, Jason

Thanks for the detailed reply.

On the correlation question, I didn't mean to imply that the new Dow Jones FXCM US Dollar Index SHOULD be highly correlated to the standard US Dollar Index. Rather, I was wondering how the two compare. I'd be curious to see an overlay chart of the two.