Going offshore to escape the CFTC

Broker Discussion Forex Brokers
1857

I have updated the [B]ProfiForex[/B] entry in the Offshore Broker List (see post #2 on this thread).

Absolutely correct.

An FXCM Micro Account with a $50 balance [B]and a 1-micro-lot minimum position size[/B] is a wipe-out waiting to happen.

To trade this account, you would have to use 20:1 actual leverage, just to open a 1-micro-lot position.

As for risk analysis: a 10-pip loss would eat up 2% of the account; a 20-pip loss would eat up 4%; and so forth.

These numbers might work for a scalper. For anything longer-term than scalping, forget it.

1859

Thanks Clint! This is a great thread.

1860

Clint,

I have been following this thread just before FXCM kicked me out due to the Dodd-Frank Act. Decided to join now so that I could leave a feedback about Profiforex.

  1. They don’t try to talk you into some gimmick bonus.

  2. They’re mostly wysiwyg, for example, if you have one open position and hedge it 100%, your margin use goes to zero.

  3. Obviously, moneybookers cannot be used, but it is the default. Just click on the PayPal logo (NOT obvious). For all practical purposes, the credit to your account is instantaneous. Withdrawal costs $5, but what I experienced took far less than 24 hours, and it stops in your PayPal account.

    • The last 2 Sundays, they experienced a spike in some currency pairs. This Sunday, I had a “Goldilocks zone” position of 6 lots of AUD/JPY buy, and 16 lots of AUD/JPY sell, all showing profit. The spike caused the buy to be taken out at the level before the spike, and the sell went into some twilight zone, which put my account in a negative balance, even though I had stops on everything.

When I complained, within hours, they restored those, and then some.

When I experienced a Sunday Spike at FXCM, they basically told me to get lost.

  1. Latency is indeed small, though it’s not always consistent.

  2. They say it’s ECN, but maybe not.

  3. 5 digit quotes, no fractions, relatively large spreads.

So far, since I don’t have the ammo to open large accounts, I am happy with Profifiorex.

1861

Skyhike, thanks for sharing your experience with them. I am just getting started with them as well. As US person I share your frustration with finding decent brokers. Lets see how it goes!

1862

Flinstone, and others following this thread,

If anyone is thinking of opening an account with Profiforex, I found them service friendly, but not user friendly for the following 2 reasons:

  • Make sure to note and save the WITHDRAWAL PIN shown on the registration page. They will not send an email of this. You will need this for a problem free withdrawal.

  • For deposits, click on the PayPal logo. Moneybookers is default It doesn’t work, and Profiforex misses some basic explanations (just as in the withdrawal PIN).

PayPal is my Pal, why:

If you have used PayPal, you know that it has some nifty features. I have a friend who needs a “fool proof” debit card :o) PayPal will issue a debit card in your wayward friend’s name, but it is essentially your account. Make sure to turn off back up funds, because:

PayPal is ACH, which means everything posts to your bank account with no “pending” notice. Losing track and overdrawing can have unpleasant consequences.

That said, all offshore brokers should adopt PayPal, imho.

1863

I think you mean WITHDRAWAL PASSWORD?

Also I did a wire but my bank charges $40 for an international wire…ouch. On a go forward I’d like to use paypal but I seem to remember them saying only one way to fund deposits and withdrawals. I have a question into finance on this.

1864

How long do international wires take (wiring money out of a foreign forex and into us bank account)? Are there limits on how much can be wired in? What about taxes?

1865

You’d have to ask the brokerage and your bank respectively. For deposits, my bank wired funds by noon of Thursday and ProfiForex credited by Saturday. For US people, contrary to what some say (also about Presidential candidate Romney) having overseas accounts are NOT ILLEGAL you just have to pay taxes on earnings and divulge them if they meet the reporting requirements. Your accountant/CPA should be able to help here.

1866

I don’t know what this slicing and dicing is all about. If you are on Profiforex, you know that they call it THE Withdrawal P.I.N. Even though there are letters as well as numbers.

If you are not acquainted, then you are a shill.

If you don’t know this, then you missed the point about PFX not being very user friendly.

And I wish Baby Pips will eliminate these silly emoticons. : o ). I thought I set my posts to NO ICONS.

I seriously want to believe the people on this forum are intelligent beings.

It takes an intelligent being to figure out what is user friendly. I don’t own ANY Apple gear.

1867

Why is anyone worried about wire transfers when PayPal deposits are instantaneous? And, costs NOTHING?

I don’t own any part of PayPal. Just use it.

1868

See “Withdrawal” password below. Account information removed.

ProfiForex - Withdrawal Password.jpg700×412 20.6 KB

1869

OK, I stand corrected, but only because I opened my account before this change took place at Profiforex. When I opened my account it was PIN, and when I go to withdrawal, it is STILL called PIN.

1870

PayPal limits and commission right?

1871

Probably you have noticed advertising for the broker FXPrimus on the main page of the Babypips Forum. I try to check on these offshore brokers, from time to time, as their advertising appears, to see whether they accept U.S. resident clients.

[B]Unfortunately, FXPrimus, domiciled in Mauritius, will not open accounts for U.S. residents.[/B]

As a service to any U.S. residents who may be browsing this Forum, seeing the FXPrimus ad, and wondering whether this broker will deal with them as a client, [B]I will add FXPrimus to Group 2 of our List at the next update.[/B]

If anyone has additions or changes to the List, please post them here, anytime.

1872

If Mitt Romney is elected, I hope these stupid bans are taken away with Dodd Frank. :slight_smile:

1873

There is a forum here on the Babypips site called [B]Broker Aid Station,[/B] which I think is a great idea.

There are currently 14 brokers who use that forum to make announcements, to advertise their wares, and to answer questions from the Babypips community.

I think it’s amazing that only 2 of those brokers are U.S. brokers (FXCM, and BeamFX) — this is, after all, a U.S. website, with a huge U.S. membership.

[B]And, of the remaining 12 (offshore) brokers, not one of them will do business with U.S. clients.[/B]

On this thread, we have identified almost 30 offshore brokers who [B]will[/B] open new accounts for U.S. residents, and yet not one of those brokers has taken advantage of the Broker Aid Station forum to present themselves to the Babypips membership.

If I were [B]FinFX,[/B] or [B]ChoiceFX,[/B] or any of the other brokers in Group 1 of our List, I would remedy that situation immediately.

A relative newcomer to the Broker Aid Station forum is the Russian broker MasterForex.

You need to see this notice from their website:

Dear clients!

We would like to inform you that MasterForex Company does not provide its services to the USA and Iran residents.
Accounts opening as well as trading operations performing is inacceptable for all citizens of the United States and Iran.
For further information, please, contact the Clients support department…

That’s Gary Gensler’s America, folks — equal to [I]Iran,[/I] in the eyes of the world.

Thanks a hell of a lot, Gensler!

(Great job regulating PFG, by the way!)

Edit: I will add MasterForex (Russia) to Group 2 of our List, at the next update.

1874

This thread is coming up on its 2-year anniversary. For 2 years, we have been preaching against the unnecessary rules and regulations put forth by the CFTC in their misguided attempt to “reduce risk” in the U.S. retail forex market. Rather than detecting and preventing actual fraud and corruption — as in the case of MF-Global and PFG-Best — the CFTC has been screwing around with leverage, and other aspects of retail trading. The CFTC has become the poster-child for the Nanny-State Run Amok.

I won’t launch into a full-blown rant — you’ve heard lots of my rants over the past 2 years.

Originally, we (retail traders) had some powerful allies — many of the largest retail forex brokers in the U.S. Remember the Forex Dealers Coalition? That group was organized to fight the draconian measures put forth by the CFTC, 2+ years ago. Then suddenly, U.S. forex brokers climbed into bed with the CFTC, and that was the end of the Coalition.

Since then, we (and a few of our offshore broker friends) have been on our own. The CFTC can’t touch individual traders, but they are relentless in their efforts to punish the offshore brokers who will deal with us.

Enter the apologist —

BeamFX, an introducing broker domiciled in the U.S. and regulated by the CFTC and the NFA, has a page on their website where they attempt to justify the latest CFTC/NFA restrictions on retail forex in the U.S. (leverage, FIFO, hedging, etc.), and attempt to convince you that U.S. retail brokers are the best-regulated, safest, and most secure brokers in the world.

This pitch is made in the form of text, which you might want to read, and in three interviews in video format, which you might want to watch. Here’s a [B]LINK[/B] to the webpage. Make your own judgement regarding the case put forward there.

BeamFX, by the way, has been around for several years (originally in Chicago, I believe), and originally operating as an I.B. for Alpari, Dukascopy, FXCM and Forex.com. Since January of this year, they have established themselves as I.B. for Institutional Liquidity LLC (New York), exclusively. BeamFX is the newest broker to appear in the Babypips Broker Aid Station forum.

Anyway, read their blurb, and watch their videos, and see whether they convince you.

1875

When do u think it will get to the point of banning trading? To protect us of course.

1876

Are these leverage limits around in corporate forex accounts?

1877

“…final leverage restrictions will only affect retail clients. This does not include commodity pools with greater than $5 million in total assets that are formed and operated by either a registered CPO or a firm properly relying upon an exemption from CPO registration or CTA firms whose clients are all ECPs, including individuals or entities with greater than $10 million in assets.”

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