Comment Text:
i0-001
COMMENT
CL-04342
From:
Sent:
To:
Cc:
Subject:
Adrian Mrva
Thursday, January 28, 2010 9:46 AM
secretary
Sanchez, Peter
STRONGLY OBJECT TO 10-1 LEVERAGE LIMIT IN REGULATION OF RETAIL
FOREX PROPOSAL RIN 3038-AC61
Attn : David Stawick, Secretary, CFTC and ALL CFTC policymakers:
As a non-affiliated US-based Retail FX trader, please note for the
record that I am STRONGLY OPPOSED to the 10-1 leverage limit as
proposed in R1N 3038-AC61 relating to the Regulation of Retail
Forex.
Counter-productive effects
This senseless limit would in NO way protect, aid or benefit me but
rather would greatly harm me since this restriction, if passed,
* would require that I submit substantially more margin-funds
into non-protected, non-FDIC insured, non-SIPC eligible
accounts, actually exposing me to increased risk in the event of
bankruptcy of my Forex Broker.
* would NOT divert my business into regulated-Futures trading
(as the CFTC is probably hoping), but rather would cause me to
seek an unreliable, higher-risk offshore FX broker to trade
through, whose practices might be questionable.
* would eliminate one of the greatest benefits of trading Forex
: My ability to efficiently deploy my own trading capital in the
way that I choose.
Lower FX vols require far greater leverage
FX volatilities are generally substantially lower than in the
Equities or Futures market. Therefore, significantly more leverage
is required simply to capture equivalent trading opportunities.
Nanny not needed
I do not want the CFTC to treat me like a child and dictate how- I
should trade. While 100-1 leverage is available to me should I
choose it I am never forced to use it. The bottom line is that OTC
Retail Forex trading is NOT Futures trading. Please do not try to
treat it as such!
PLEASE IMMEDIATELY STRIKE YOUR PROPOSED 10-1 LEVERAGE LIMITATIONS.
Don't let proposal R1N 3038-AC61 become an expensive lesson in
unintended consequences ....
Thank you.
Adrian Mrva
