Leverage is a scam - Forex brokers are electronic scams

[Woodpecan 16]

Institutional traders do not use leverage, and no bank or broker will lend you money to trade.
If a broker has leverage greater than 1:1, it is a scam, and your profits will be delayed and your account will be closed. This electronic scam does not make use of real money. It is an electronic computer system that generates a real price with an unreal small bid/ask price while charging a daily spread and calling it "swap" when it does not exist.
If you buy eur/usd on an electronic platform with an account in eur, you are making a profit, which is impossible in any bank or public exchange.
You can open a "forex brokerage" with 5000$, get a platform, and accept money from traders in the same way that a bookie does.
According to the electronic scam platform, there are currently 450000 orders open, and if it is a minimum of 0.01 lot or 1000$, we need a minimum of half a billion dollars to "process orders."
How much money can you make as a broker with this electronic scam - revenue on 100.000 accounts is 4.5 million dollars per year.
All "ecn" and "cfd" "brokers" are electronic swindlers. You do not own any money or stocks; your deposit is held in a single account.
Currency moves no more than 5% per year; it is "penny stocks," and your profit will be no more than 6% - 7% per year if you trade through a bank or an institutional broker.
I'm not even sure if these stock brokers are real. Trading in a bank, I am directly connected to 35 stock exchanges (all over the world) via the NYSE to send real contract orders for real buy stock. I'm charged $0.04 per stock. Why does a stockbroker charge $4 or $9 per order?
Best institutionals make 20% - 30% per year by charging high fees. Hedge funds, on the other hand, are the best business if you are the owner.
Most stock traders trade trends because they have never owned a company and have no idea what makes a company profitable. Take, for example, Amazon. Since the beginning, their total profit after taxes, paychecks, and other expenses has been $8 billion. But if the company is pumped to 100 billions, will you pay 200 billions for a profit of 8 billions in decades? Is it a wise decision? People who follow trends get a thumbs up.

[Wolfire 29]

Is it possible for a true STP/ECN broker to provide 500:1 leverage?
Banks typically provide maximum leverage ranging from 10:1 to 25:1 depending on a variety of factors ranging from credit worthiness to the currencies being traded. Greater than 30:1 leverage is unheard of in the Tier 1 (Bank) PB environment.

Banks are very picky about who they will lend money to. As a result, a major money center Prime Broker would not accept a high leverage broker as a client, especially given the risks involved. If you hear someone marketing themselves as a "institutional liquidity provider" or "prime broker" and offering leverage greater than 100:1, don't be fooled; it's quite possible that they're using a market-maker/dealing desk model in some shape or form.

Assume a client executes a USDJPY 5,000,000 trade at a leverage of 500:1. This trade will necessitate a USD 10,000 margin (5,000,000 / 500). To execute the corresponding matching trade with its bank liquidity provider at 25:1 leverage, the broker would need to use USD 200,000 (5,000,000 / 25) in margin with its prime broker.

To maintain the same size trade, the broker must use 20 times more capital than the client.

[Capeshifter 31]

So, the majority of brokers are scamers???

[Spaladin 70]

I believe it is entirely dependent on your definition of a scam. Scams and business are not the same thing. A scam, according to the Cambridge Dictionary, is an illegal plan for making money, particularly one that involves deceiving people.

However, most brokers who offer leverage notify traders of the maximum amount of leverage they can use, and traders are free to choose their account types and the maximum amount of leverage they can use. How can you say it's a scam if the broker provides this service to traders and traders are willing to make this transaction?

Simply because it differs from your value does not imply that everything in this world is a scam.
 

[FakeTurkey 9]

Hello, I recently switched from Forex.com to Oanda because Forex.com began asking for excessive fees for services such as email support and so on. (This started happening after withdrawing more than $50,000). So you're saying Oanda will do the same to me?

[DarkSeahorse 43]

According to brokers, the following banks provide forex liquidity: Bank of America, Commerce Bank, Barclays Bank, PLC – Citadel Securities LLC – Citibank N.A. – Deutsche Bank AG.

So, if you ask them if they want to open an ECN brokerage service for their clients, the answer is yes, just deposit 450 million dollars and we will give you leverage less than 3. You can charge commission and hope that there is no margin/leverage overload by users in the ECN environment.

So brokers require 450 million dollars per liquidity provider, and if a client deposits 0.01 lot (1000 dollars), the broker requires 20 times more money (20.000 dollars plus commissions) (multiplied by 100.000 accounts is sick margin) to process orders in an ECN environment where there is no conflict of interest with client profit or loss.

Brokers claiming to be ECNs with leverage in excess of 100 have a conflict of interest against their clients in the MT4 platform and do not process client orders to liquidity providers. More than likely, 100 percent are B-book forex brokers with no money who cannot afford leverage such as 100, 500, or 1000 to bank liquidity providers.

[GlamorousPup 12]

Brokers do not need to be con artists with the technology available today.

Brokers simply monitor a trader's risk and decide whether the positions will be posted to the ECN market or internalized, keeping the order in house and taking the other side of the trade. Brokers understand the odds of your positions and the probability of what will happen to you based on past performance.

[RoadGhost 69]

 agree that there are many "brokers" out there who will do anything to keep your money rather than give it to you, especially with these "bonus" offers. Perhaps it has something to do with how strictly they are regulated? Before the CFTC reduced leverage for US residents to 50:1, I was trading with GFTforex (at 400:1), and they were AMAZING! I traded with them for several years and withdrawals were very easy and quick, with no glitches, and I took money out every 2-3 weeks, so there were a lot of withdrawals! However, it is possible that it was so good because it was heavily regulated by the US at the time.....

[ScaryNightElf 60]

When there was inflation in Serbia, many people bought huge houses by selling currencies that were higher than the current price and buying currencies that were lower than the current price. Their money grows.
There is only one way to profit, and that is to buy low and sell high, which is what the broker does to all "traders": he sells you high and buys from you low, so the only way to profit (regardless of price) on forex is to OPEN BROKERAGE.
There is no need to process orders to banks, and math says that "traders" can only profit in the long run if they buy low and sell high.

[PartyBerry 60]

Everything that costs more than it is worth may be overpriced, but that does not make it a scam. People are willing to pay for convenience and technology. Are a lot of things overpriced? Yes, they are! However, if you want to use technology or have convenience, you will have to pay for it.

You could have unlimited access to all necessary raw materials (ores, sand, and even polymers), but you couldn't build a car, a phone, a TV, or even a refrigerator. You can grow your own cotton plants, pick the cotton, de-seed the cotton, make it into fibers, weave it into cloth, dye the cloth, cut the cloth as needed, and sew the cloth into pants and a shirt...OR you can pay for the convenience of having someone else do all of that.

I have to ask: If you truly believe currency trading is a scam and that making money is impossible, why do you continue to trade?