Comment Text:
i0-001
COMMENT
CL-05893
From:
Sent:
To:
Subject:
Bernard J. Stankay
Thursday, March 4, 2010 2:22 AM
secretary
Regulation of Retail Forex
Dear Sir:
I am in favor of retaining a 100:1 leverage ratio. I am not sure why a 10:1 leverage cap is even being considered when it is
already an option that anyone is free to choose. Furthermore, I do not find risk an issue. A 10:1 leverage would require much
larger investments to make it worthwhile even participating and thus subjecting novice traders to risking larger amounts of
money. The many small balance investors are better served risking smaller amounts of money at the larger 100:1 leverage
thus reducing potential loss and encouraging learning. For small balance investors, ten cents on the PIP is hardly worth
trading small amounts of money for. Itwould be so time consuming to make any appreciable money that it would be
pointless. It is a full time commitment making $1 per PIP. Imposing a 10:1 leverage would eliminate many serious small
balance investors and it would diminish participation and interest in the trading profession.
If there is any issue, I would say dealers should provide more accessible training at no cost for trading novices regardless of
account balances. Also, I would recommend providing more opportunities for traders to have access to higher end trading
software such as MetaStock at no extra cost and regardless of account balances. This would enhance training appreciably and
serve to substantially reduce risk by providing better tools to ease the learning process and the day-to-day trading
process, and to encourage participation.
I recommend enhancing opportunity through training and tools and not suppressing opportunity by limiting income with caps
especially when the 10:1 leverage is and always has been an option. I would add that being a novice trader with about 6
months of foreign exchange experience, I would concur that leverage ratios higher than 100:1 should be limited to more
experienced traders. I believe the 100:1 is the perfectly reasonable balance that is in the best interest of the most traders.
100:1 provides sufficient incentive to smaller investors while at the same time reasonably limiting risk.
Very sincerely,
Bernard J. Stankay
