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Comment for Proposed Rule 75 FR 3281

  • From: Willie Riley

    Comment No: 134
    Date: 1/15/2010

    Comment Text:

    Willie Riley
    Friday, January 15, 2010 10:13 PM
    Regulation of Retail Forex
    To Whom It May Concern,
    I am a small retail forex trader. I believe the retail traders make up a small portion of the overall forex market, and
    as such, we don't make a significant dent in the $3 trillion dollars that change hands on a daily basis. With the
    advent of computers, this market is now (as in the last 10 years) accessible to people like me to have the
    opportunity to participate and have a chance to profit from trading. The new proposed regulations to register
    brokers, account managers, IBs, is a good step to protect the public from fraud and scammers. The new
    proposed regulation to limit leverage in forex, though, is horendous to me.
    Using money management to limit risk to 1% of account balance with a small stop lose increases the odds
    dramatically of a margin call, (I've had only 1 in 6 years of trading) as well as cut the potential of profit by 90%.
    This would make it dramatically harder to make money with a limited amount of money. I have less than
    $5,000.00 account, but it is possible to generate a comfortable income for my wife and I with that amount
    currently with the 100:1 leverage system, but under a 10:1 leverage system, it would be impossible to make a
    living without a substantial larger account, of which I, and a lot of small traders, don't have.
    The move to 10:1 leverage in forex will force me out of trading and prevent us from being able to provide for
    ourselves in our later years, as I have disabilities limiting the work I can do and my wife has Parkinsons disease
    and can't work or drive. I believe the move to 10:1 leverage is ridiculous and will cause the loss of jobs in the
    industry, as people are forced out of the markets, and cause some people to move their $ to offshore accounts,
    causing a drain on our economy. I would ask all persons involved to leave 100:1 leverage in forex in place.
    Willie Riley