Why doesn't anyone use big forex brokers like citibank, HSBC, etc?

I would assume these are much more reliable than other bucketshops. I’m guessing though that minimum deposit could be very high, hence why not many people have an account. Still, does anyone have any info or experience about these large banks as brokers?

Citi fx was sold to FXCM, Etrade offers fx trading but through FXCM.

The “bucketshop” moniker is simply hoisted on dealers to scare people away from them so that other dealers can win their business. HSBC is a market maker and I would do business with them without fear. Oanda was one of the first and is a real innovator in retail fx, I certainly like them. Gain (Forex.com), FxPro, EToro, Trade King, and many others specialize in fx trading and are not stock brokerages or large banks that have come into retail fx. FXCM has become the premier fx dealer in the U.S. and is great.

Ten years ago there were many start-up fx dealers that got into trouble and the horror stories keep fear going. But now there are many solid fx dealers that look to be here to stay. The key is not to pick the right dealer, but to get accounts with many good dealers and diversify your dealer risk.


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Thank you so much for the informative answer. As a sidenote, do you think it’s better to open a no commission-higher spread account or a with commission-lower spread given that starting deposit might be from 1.5 - 2 k Euro?

The biggest problem is that most people are not sure how to work out here, so they keep on seeking short cuts to earn peanuts, but at least for them it’s butter of their life, so that’s why they prefer to work with companies which might not be perfect, but at least good for them in situation they find themselves while of course if a person has knowledge and money, it’s no question he is going to work with the best.

I would say that whatever option offers the lowest total cost is the most appealing and if a larger deposit will lower costs then that could make the larger deposit worthwhile.

That said, my view of fx trading costs is that they are best mitigated not by choosing the best dealer (although I would certainly try to trade with the lowest cost dealer) but rather by trading the longest term one can without giving back too much at the end of each trade and thus trading as infrequently as possible.


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I think another aspect to look at is the simple fact we don’t exchance cash which is what your banks do.

We use over the counter finical products to speculate on price movement at an exchange. Banks arent interested in being a bookie. So they dont offer these products.

Of course, if you could find a bank (or even better an individual) that would give you a cash exchange at a rate close enough to spot you could trade fx without a dealer at all and hold your positions as notes in a safe. But this would prevent short trades and expose you to serious risks in the event that a currency crisis develops. For those nutbags that are completely terrified of marketmakers, this could be an option.


The European Commission imposed collective fines of nearly 400 million USD on four major banks – HSBC Holdings Plc, Credit Suisse Group AG, Barclays Plc, and Royal Bank of Scotland Group Plc over their role in the so called ‘Sterling Lads’ forex cartel.

The four banks were found guilty of manipulating the forex market by sharing confidential information and trading plans through an online chat room called “Sterling Lads” among other channels.

What is there to add, really? :frowning:

trading raw cash would not prevent short trades.