Comment Text:
i0-001
COMMENT
CL-03085
From:
Sent:
To:
Subject:
Hor
Saturday, January 23, 2010 12:08 AM
secretary
Regulation of Retail Forex
To the secretary:
In regards to the proposal of CFTC on Forex brokerage and leverage regulation, I strongly disagree and object to
the new proposal ruling.
Reason is
1) For trading is all about risk vs reward. For leverage 100:1 , with $1000 margin, at 100 times leverage, you
would make $1000 on a 100-pip profit in EUR/USD.
But if is only 10:1 profit will be only $100. This is a lot as 10% of your trading capital is involved.
For forex traders, we go for smaller movement of the points life 10-20- pips instead of 100 pips example I have
mention above. With this, it become no longer worthly for the risk that I will be taking.
2) Forex trading is not like stocks trading which can be view as long term investment tool. Forex traders are
actively trading very short time period, in and out of the market at an instant. Therefore leverage give our flexibilty
and meaning profits for the time and effort and risk we undergo.
I seriously do not wish that the new proposal regulation will come into play as it will affect the whole US retail
forex trading market. When domestic retail traders do not enjoy the leverage advantage here in US, they will find
that foregin based brokeage more attractive and pull out money from US to other country which in this economy is
like adding an extra hit/blow.
In conculsion, I wish that the goverment will come out regulations that will attract foregin investors and thier funds
back to US instead of replusing foregin and domestic investors/traders away for the US. And that will be a
proactive movement ( in my opinon ) by the goverment for market recovery.
Andrew
