Trader #1 stated nothing about their situation. Claims all the positive reviews are trolls? Yet fails to state how it was XE/XM’s fault they got ripped off? That is suspicious.
Trader #2 was likely a news trader during high impact news release. Foolish move. Should have filled the order 1-2 minutes before that. The price feed basically works as this.
Bank -> Broker -> Retail trader
The retail trader is always at the tail end of the information chain. Trading news like that is akin to standing in front of a runaway train. You can win big if you luck out and plan accordingly beforehand with prudent Take Profits and Stop Losses. But it’s incredibly risky. Then has the nerve to blame the broker for not protecting them. The broker is not the trader’s mommy, the broker facilitates the transaction between the bank and the retail trader, while lending capital to the trader, in exchange for some profit from the spread/commission. You can’t demand that they protect you from bad trading conditions. They want to make money. If you click “trade”, then they make money. Fools are quickly parted from their money.
Trader #3, probably in the same boat as #2. News was likely whipping hard, and tried to manually trade on it. I always compare charts between brokerages before opening an account with one. XM’s charts didn’t differ from BCFX, nor FXCM greatly. There was roughly a 1.2 pip differential between the 3 of them on a 15 minute candle, but it was on the GBP/JPY. So a 1.2 pip on that is like a .5 pip on the EUR/USD. Not a big deal at all.
Again, people forget the Chain of Command or CoC of forex. If you want to manually open a trade, that info gets passed on to your broker, then gets passed on to the bank. If price is moving quickly, odds are you’re going to open your trade at a position worse than you had hoped for. You’re trading with the bank, not the broker. If the bank’s price has already moved, then your entry has subsequently moved.
Trader #4, XM, and virtually every other broker states that the deposit and the withdraw locations must come from the same person. Otherwise people could phish account info from various sources, and steal those funds, and trade them for their own profit. That is a legit, and safe practice. I mean, why wouldn’t that trader simply have his/her friend transfer it to them, and then they deposit from their account, and withdraw back to that same account? That information is right in the FAQ section. It’s not a bad excuse. It’s a fair, and legitimate reason. Every established, respected brokerage has the same practice. The trader failed to read the rules before making a foolish mistake. Can’t blame the broker on that one.
XM.com has been on my radar for a bit. I was very skeptical about them having a bonus structure, and the claim of no commissions on their standard account. Once I saw the spreads, they gave me some faith. Their spreads are higher than my current broker. My current broker also charges commissions. If there is no commission, there is an increase in the spread, so a legitimate broker can make money. XM’s spreads are higher, because they need to make money. They also don’t have an upfront charge for wire transfers, and (my personal favourite), they offer a debit/credit card. I’m trading from Canada, so me avoiding wire transfers, and the associated fees with having that money transferred ($20USD to the Bank of China every transfer…) is awesome. They also do have a bonus structure, which basically rewards long-term traders with some bonus bucks, giving them extra equity for trades, or pocket change in real dollars.
When you size up the spread from a low-spread broker, and the minimal services that they offer, against the higher spreads from XM (average 4.0 GBP/JPY from XM vs. 2.1 from discount brokerage) the cost is fair, considering the bonuses, transfer discounts, and the fact they take their commission directly from the spread. You can sign up for the Zero account that has much lower spreads, but they charge a commission on that account.
IMO, the biggest reason we have such a horrid FX climate in Canada, is because traders just jump on the bandwagons, instead of doing their own homework. They lose, now we have horrible leverage rates, because the losers complain, all the freaking time. Some provinces are just flat-out refused. XM wouldn’t flat-out refuse B.C. and Quebec residents if they were a scam.
Should also mention they offer VPS services too. Once you have a minimum of $5k USD in your account, you can get the VPS for free, which is great for people using EAs.
No, I’m not an XM shill. I’ve just done my homework, and their offerings seem to be on par with what they charge.