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Human stupidity?!

FXdiversified
Oct 10 2013 at 12:45
30 posts
Danneskjold posted:
Basically, brokers are going to function like any other business: if you want to develop a successful business, you need happy return customers. So any broker that's looking to stay in the market for the long term is going to have to maintain good business practices, because otherwise they will lose clients and they will gain a bad reputation that will prevent them from getting new clients.

Of course there are differences between how customer friendly each broker will be; but the basic rule is that scams don't last long.



I doubt there is a rule for 'functioning' in all businesses across the globe. Brokerage is business of scale and in FX you compete against huge fair established institutions. It is hard to make money for a new broker, that's a fact. We might discuss how a trading desk generates income and why 'real inter bank access is slightly different thing. It is not scam, that's usual practice.

Additionally it is not about 'friendliness' , it is about fine defined stream of revenues, nothing else. Finally I mentioned the 'insurance character', it is not only the brokerage, it is about the local environment of the physical location of brokerages.

I believe there is a need to ensure fair practices and the service idea as driver of business is not good enough to me. It might be to you os you should feel free to take the brokerage of your choice.

And finally scam work sometimes long enough and history is full of scams. So I cant see the assumption that 'brokerages' per definition have guarantee fair process because they want to keep the customers as valid argument.

FXdiversified
Oct 10 2013 at 12:59
30 posts
Thalantas
Oct 10 2013 at 18:37
192 posts
I kinda agree with both of you (Danneskjold and FXdiversified). An obvious and ridiculous scam broker won't stay long enough but a more malicious one will. Think about the dinosaur brokers, here since a while that keep aggregating huge amount of trades. Most of them got fined by the FSA / SEC..etc at least once every year for constant negative slippage for customers and other manipulation.

That's the thing about FX, foggy universe without regulation = easy to manipulate.

So I'd say follow the crowd and you won't have much to worry about.

A smooth sea never made a skillful sailor.
Danneskjold
Oct 14 2013 at 11:05
8 posts
FXdiversified posted:
And finally scam work sometimes long enough and history is full of scams. So I cant see the assumption that 'brokerages' per definition have guarantee fair process because they want to keep the customers as valid argument.

Well, we don't want to go to extremes. I meant that more as a rule of thumb. Naturally there are less-than-scrupulous businesses that last for a long time and make a lot of money.

Like Thalantas points out, FX is a foggy universe and there are plenty of areas that can be exploited. But in the long run, businesses that provide value to customers are the ones that are going to succeed, versus businesses that are cutting corners at the expense of customer satisfaction (frauds). But in no way does that guarantee that a broker is going to be fair. It's just an incentive.

FXdiversified
Oct 14 2013 at 17:12
30 posts
Danneskjold posted:
FXdiversified posted:
And finally scam work sometimes long enough and history is full of scams. So I cant see the assumption that 'brokerages' per definition have guarantee fair process because they want to keep the customers as valid argument.

Well, we don't want to go to extremes. I meant that more as a rule of thumb. Naturally there are less-than-scrupulous businesses that last for a long time and make a lot of money.

Like Thalantas points out, FX is a foggy universe and there are plenty of areas that can be exploited. But in the long run, businesses that provide value to customers are the ones that are going to succeed, versus businesses that are cutting corners at the expense of customer satisfaction (frauds). But in no way does that guarantee that a broker is going to be fair. It's just an incentive.


look you are right no need to go to extremes. I consider FX to be an extremely clean business... to be honest. I was working in this environment for the last decade and I think it is more transparent than any other asset I know. But there are some rules.... I guess as in every business. If you know want you are doing you will be fine, if not it might get into areas you are talking about. So after all we might not disagree :-)

Danneskjold
Oct 16 2013 at 08:33
8 posts
FXdiversified posted:
look you are right no need to go to extremes. I consider FX to be an extremely clean business... to be honest. I was working in this environment for the last decade and I think it is more transparent than any other asset I know. But there are some rules.... I guess as in every business. If you know want you are doing you will be fine, if not it might get into areas you are talking about. So after all we might not disagree :-)

Most likely.

I guess that it's just there's a lot of people who lose money in forex, and then whine about being scammed when they didn't take into account slippage or failed to apply proper stop losses. It's easier to cry fraud than review one's trading record. So, yeah; if you know what you're doing, you'll be fine. If. :D

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