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Forex and Futures

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Market Wizard
Boca Raton
 
Trading Experience: Advanced
Platform: Variety
Broker/Data: Optimus Futures, LLC
Favorite Futures: Futures
 
mattz's Avatar
 
Posts: 2,410 since Sep 2010
Thanks: 2,341 given, 3,560 received


bourgeois pig View Post
THis statement seems likea blatant fallacy. If my debate class memory serves me correctly, this statement is ad hominem.
I would think that any market could wipe out an over leveraged account during a volatile move against ones posistion. IF you have a market stop then it could get filled with major slippage and a limit stop could get jumped...... In any market..... and a negative balance could ensue.....in any market.

The liquidity claims FOREX brokers advertise seem ridiculous to me. Certainly there are futures markets that lack liquidity but there are also FOREX pairs that lack liquidity. Likewise there are futures markets with ample liquidity for small and big lot traders as there are in FOREX pairs.

I am not trashing FOREX, personally the smaller lot size appeals to me, I am just saying that some of the claims that FOREX brokers make seem a bit ridiculous.

I agree with what you said, but this is not only a liquidity issue.
Gaps could occur in both liquid and illiquid markets, and as such, to guarantee limited risk is deceiving and not true in both liquid and illiquid markets.

For many years, I saw this statement of limited risk on FX on many FX broker sites, and was always puzzled how could such thing could be claimed.
To be honest, at times, I have thought that they have a better system to monitor risk, but they do not.
The Swiss Frank sharp rise due to SNB announcement, has sent many FX shops bankrupt or near bankruptcy.
This illustrates that no risk is limited.

This is what you should keep in mind when it comes to stops in any asset classes:
The placement of contingent orders by you or broker, or trading advisor, such as a “stop-loss” or “stop-limit” order, will not necessarily limit your losses to the intended amounts, since market conditions may make it impossible to execute such orders

Something rather off topic slightly, but I see that many in FX cash I consider potentially legitimate operations, charge commissions as oppose to spreads. This bares the question of why so do and some do not. I did not dig deep enough to find out, but I am curious.

Matt

There is a substantial risk of loss in futures trading. Past performance is not indicative of future results.

PM with any questions about optimusfutures (800) 771-6748 (561) 367 8686. THERE IS A SUBSTANTIAL RISK OF LOSS IN FUTURES TRADING.
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