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.
Your forum profile doesn't mention where you live. That would determine which FXCM entity you can trade through.
FXCM UK and FXCM Australia offer clients up to $50,000 in negative balance protection on forex trades. This policy will apply to negative balances incurred during all market conditions, including exceptional market movements. Each client's master trading agreement will detail all of the specific exceptions to the Negative Balance Policy.
Some of the key exceptions to this policy include the following: negative balances incurred by legal entities, omnibus relationships, white label relationships, Eligible Contract Participants, Eligible Counterparties and/or Professional Clients (as defined in the client's master trading agreement) and/or negative balances incurred on share CFD positions or products traded on an exchange.
For full details, please review the master trading agreement if you decide to open an FXCM account.
Note: Negative balance protection is not available to clients of FXCM US or any other US broker due to CFTC regulations which state that a broker may not in any way represent that it will guarantee against losses.
Your reasoning is correct. If you have $1000 in your account for each 1k lot of USD/JPY you trade, then your account can't go negative even if the US dollar falls to zero.
Note: If you trade 1k GBP/USD, then that is actually 1000 GBP in notional value which is more than 1000 USD. You would need to have $1411.80 in your account for 1k lot of GBP/USD you trade (at the current exchange rate of 1.41180) in order to trade at perfect 1:1 leverage on that pair.