many thanks for the detailed answer. It was a good overview of what happened and you made a great effort to answer questions - just like you always do.
There was one surprising fact in the video. As far as I know FXCM is a market maker which means it takes the other side of the trades from retail traders. In the video the opposite was said, that FXCM does not take the opposite side of traders. Is there not contradiction here between the statement in the video and being a market maker?
The main question was not answered in the video, but I take the following part of your post as an answer for what FXCM does for avoiding such situation and have less risk in the future for such unforseen events:
Is there any other practices FXCM or other brokers took to decrease risk? It is important because everyone wants to have his money save. And I never stated the situation was fault of FXCM, but it does not change the fact that FXCM was known to have very serious financial problems just like some other brokers who are out of business.
When we are trading, one of the key issues is to have proper [I]money and risk management[/I]. Now the same could be expected from brokers. I am a trader and not a broker so for this reason just from my point of view, in the financial industry it would be expected from a broker to have right money management rules for itself when it is teaching clients how important these rules are so traders do not lose their money.
There is nothing which makes successful traders more angry than trading well and not being able to pull out their money because their broker did not follow the same as safe strategy as it advised for its traders.
One known practice brokers made to decrease risk is to have lower leverage for certain currency pairs (mostly CHF). These leverage restrictions are however partly or completely deleted, business runs as ânormalâ and I do not see any reason why not to believe that the same âflash crashâ could happen any time again, destroying brokers again.
Once more, this is not against FXCM, but FXCM had problems after the event and also, you are one of the most competent from the âother sideâ in the forums so I decided to ask you.
Since 2007, FXCM has provided traders with No Dealing Desk (NDD) forex execution. On the NDD model, we offset each client order one-for-one with the best prices from competiting liquidity providers. That means we donât profit from client losses or lose from client profits. Instead, we make money from client trading volume.
At the time of the SNB event on January 15th and the video about what happened, FXCM only offered NDD forex execution. However, since then, we have introduced a new dealing desk option. It is designed for traders who demand higher leverage than we offer on NDD.
In light of the reckless actions of the SNB, FXCM has since ceased offering any currencies which carry significant risk due to potential manipulation by their respective governments either by a floor, ceiling, peg, or band. In addition to that, we also raised the margin requirements for other currency pairs which reduced the maximum leverage available on our NDD forex execution to 100:1.
We continue to receive demand for higher leverage (lower margin requirements) particularly from traders in emerging markets where the average account balance is smaller. Offering these traders a DD option as an alternative to our existing NDD model allows us to cater to their demand for higher leverage from a risk management perspective.
Itâs important to understand that the market data show that the losses on January 15 were not the result of FXCM technology or FXCM margin requirements, but rather due to the extreme market dysfunction resulting from the SNBâs irresponsible and unforeseen announcement to completely remove the 1.2000 EUR/CHF floor.
The January 15 flash crash saw the EUR/CHF drop 40% in seconds whereas the 2010 flash crash in the equities market saw about 9% drop in the Dow Jones Industrial Average over the course of a few minutes. With a 40% drop in EUR/CHF, a forex account could go to negative equity even for someone trading on as little as 3:1 leverage with over 33% margin to cover open trades.
The EUR/CHF move was 44 standard deviations, while most risk management systems only contemplate 3-6 standard deviations. The moved wiped out those clientsâ account equity as well as generated negative equity balances owed to FXCM of over $225 million. We believe that the FXCM system operated properly during this event.
The caveat of our no dealing-desk execution system is that traders are offset one for one with a liquidity provider. When a client entered a EUR/CHF trade with FXCM, FXCM Inc. had an identical trade with our liquidity providers. During the historic move, liquidity became extremely scarce and shallow, which affected execution prices. This liquidity issue resulted in some clients having a negative balance.
While clients could not cover their margin call with us we still had to cover the same margin call with our banks. When a client profits in the trade FXCM gives the profits to the customer, however, when the client is not profitable on that trade FXCM Inc. ends up having to pay the liquidity provider.
FXCM ended with a regulatory capital shortfall. Accordingly, FXCM needed to get a loan to cover this balance, which it did. For anyone that still thinks FXCM is running an FX dealing desk for clients on our No Dealing Desk (NDD) forex execution, we have now demonstrated that such is not the case.
Thanks to an upgrade to our back end technology, we have created an ideal trading environment for all tradersâespecially for scalpers, news traders and EA tradersâto easily implement many strategies on popular stock indices such as the GER30 (DAX) and US30 (Dow 30).
[B]BENEFITS OF OUR ENHANCED INDEX CFDS:[/B]
[ul]
[li][B]Lower spreads on US30[/B], from a target of 4 points to 2 points
[/li][li][B]No re-quotes[/B]. Trade index CFDs and spread bets with fast and efficient trade execution without expensive re-quotes.
[/li][li][B]No stop and limit trading restrictions[/B]. Place stops, limits and entry orders with no minimum distance restrictions on the following CFD products.
[/li][/ul]
Our service includes products that are traded on margin and carry a risk of losses in excess of your deposited funds. The products may not be suitable for all investors. Please ensure that you fully understand the risks involved.
Last month I told you about our new $10,000 Monthly Challenge. Iâm now happy to announce our inaugural winner Grant who topped the pool of 21,612 traders by producing an astounding 499% return on his equity for the month of September!
DailyFX trading instructor Walker England had a chance to speak with Grant about how he got his start in forex, his trading techniques and his views on the market: September 2015 $10,000 Challenge Winner
Itâs almost the end of the month which means another opportunity to compete in our $10,000 Monthly Challenge is just around the corner.
In order to be eligible to compete, a trader must have a live FXCM US Mini Account for the entirety of the month. For the purposes of the contest, the trading month officially begins at 5pm New York Time on the last day of the previous calendar month and ends at 5pm on the last day of each calendar month.
[B]Contest Highlights[/B]
[ul]
[li]$10,000 prize pool
[/li][li]Contest restarts each month
[/li][li]Simple rules: best percentage return wins
[/li][li]Automatic entry for FXCM US Mini Accounts
[/li][/ul]
Our service includes products that are traded on margin and carry a risk of losses in excess of your deposited funds. The products may not be suitable for all investors. Please ensure that you fully understand the risks involved.
Note that there will be [B]4 days of rollover interest[/B] earned or paid on all currency trades open on Tuesday, November 24th at 5pm New York Time (22:00 GMT).
I will be out of the office for the rest of the week for the Thanksgiving holiday here in the US and will respond to your forum posts when I return next week.
If you require immediate assistance, please contact our 24-hour live customer support team.
Forex trading hours remain unchanged for the Thanksgiving holiday, and the holiday trading hours for CFDs are listed in this earlier post:
For everyone celebrating Thanksgiving this week, I wish you a good one!
Aside from Christmas and New Yearâs, FXCMâs live customer support team is available 24 hours a day, seven days a week. The Trading Desk opens Sundays between 22:00 and 22:15 GMT and closes Fridays at 21:55 GMT.
FXCM encourages you to review and update your account profile on an annual basis to ensure the information within your profile is accurate and up to date. To ensure accurate account information, please log in to MyFXCM.com with your live account log-in details and make any necessary changes under âAccount Information.â
Our service includes products that are traded on margin and carry a risk of losses in excess of your deposited funds. The products may not be suitable for all investors. Please ensure that you fully understand the risks involved.
[B]I will be out of the office for the Christmas holiday[/B] and will reply to your posts and private messages when I return on December 30th. Our holiday hours are listed in my previous post. If you require immediate assistance, please contact our live customer support team.
[B]For all of you celebrating Christmas, I wish you a happy one![/B]
I just received the following heads up from DailyFX senior strategist David Rodriguez:
[I]As a quick note, please be aware that rollover charges are especially elevated tonight [5pm New York time rollover] for the GBP, EUR, and JPY. It is near-identical to last year, when a sharp drop in available liquidity forced interbank Forward rates to deviate substantially from their typical spread to spot prices.
In short: strong demand for overnight lending in JPY, GBP, and EUR has been met with short supply, and pricing has surged accordingly.
I will be out of the office until January 4th and will reply to your posts and private messages when I return. Our New Yearâs holiday hours are listed in my post quoted below. If you require immediate assistance, please contact our live customer support team: Contact Us - FXCM
I wish all of you a blessed and prosperous new year!
Just a quick heads up: a new version of Trading Station Desktop is [B]now available[/B].
That means the next time you log into the platform after this weekend, it will automatically update you to the latest version. If donât want to wait, then you can install the new version now: Forex Trading - FXCM UK
It was first released on 21 December 2015, so if you installed the platform after that date, then you already have the latest version.
[B]New features include[/B]:
[ul]
[li][I]Stop-Limit and Trailing Stop-Limit orders[/I]
[/li][li][I]Multiple Marketscope charting windows[/I]
[/li][li][I]Ability to save multiple logins[/I]
[/li][/ul]
Please let me know if you have any questions about the update.
Our service includes products that are traded on margin and carry a risk of losses in excess of your deposited funds. The products may not be suitable for all investors. Please ensure that you fully understand the risks involved.
Daylight Savings Time will start in the US on Sunday, March 13th. That means the trading hours for CFDs that follow US market times will shift by one hour starting next week. Below are the updated times.
In terms of New York Time, the trading desk will still open at 5pm on Sunday and close at 5pm on Friday as always. However, since New York Time will shift this weekend from GMT-5 to GMT-4, the trading desk hours will also shift by one hour in GMT terms. Starting next week, the trading desk will open at 21:00 GMT on Sunday and close at 21:00 GMT on Friday.
A special note for all MT4 clients on our New York Close servers
The time zone on our New York Close MT4 servers will change this weekend from GMT+2 to GMT+3. In this way, midnight on your MT4 charts will stay in line with the 5pm New York Close. If you have any EAs or indicators that use a GMT offset, please update them to GMT+3 this weekend.
Note: I will be out of the office for the rest of the week and will respond to your posts and private messages when I return.
Below are the CFD holiday trading hours for Good Friday and Easter. Forex trading hours remain unchanged, and you can view the holiday rollover interest schedule here: Forex Rollover Calendar
Hope you are doing good. Not sure if this is the correct thread for a query in FXCM MT4.
My concern is candles/Price are not updating in FXCM MT4 platform . Every time I need to close and reopen my MT4 platform to get the latest price. Facing this issue for quite a long time. When I was in touch with one of the FXCM representatives, they suggested to reinstall. I have uninstalled the platform and installed couple of times. But still this issue not yet resolved.
Also I am sure internet speed is not an issue. Because it is working perfectly fine in other platforms. Any suggestion on this.
The candles and prices on my MT4 platform update in real time, and I have heard of no such issues with other users.
Here are my first thoughts one what could be causing the issue with your platform:
[ul]
[li]Are you using a demo? Perhaps it is expired.
[/li][li]Are you looking at an offline chart? Switch to online.
[/li][li]How many symbols are listed in your Market Watch window? The platform can only update information for 40 symbols at a time. If you have more than 40 symbols showing, then you must right-click on the Market Watch window, go to Symbols and select the 40 you want to display.
[/li][/ul]
Regarding Online/Offline - Are you referring about internet. If Yes, Iâm online. Is there any setting in FXCM platform to change to Online/offline
Are you referring even in the Market Watch it should be less than 40. If Yes, then this might be the issue. Because initally i have set as Show All. Let me Hide it and check.
It seems 3rd point is the problem. Now it seems updating.
I have one more query. Is it possible to install RSI-Divergence alert in Trading Station. Iâm comfortable in TS compared to MT4. But the problem is Alert/EA is not working in Trading Station
Trading Station is a superb platform and extremely versatile and user-friendly, but the Alerts is one area where it is quite weak in what is available. Nowadays there are so many variations of what one could wish to be alerted about that I could imagine that it is a coderâs nightmare.
But I do wonder, is it not possible to develop things so that one could allocate âidentity labelsâ to particular indicator components and then simply set a generic alert for when âAâ crosses âBâ etc? For example, one would be able to alert for a cross between âAâ = an MVA based on typical with 5 min TF, and âBâ = a regression line based on middle-to-middle with close prices and a 30 min TF and so on and so on.
In addition the indicators that come pre-installed on Trading Station, you can install additional custom indicators which are available at FXCMapps.com and FxCodeBase.com. I searched both of those websites for âdivergenceâ and found the following:
