For the past 6 months I have been approaching (and have been approached by) many of the tier 1 brokers and hedge funds looking to form a partnership in which they would raise funds for me to trade.
To my surprise I could not find a single broker or hedge fund that actually cared about whether or not I could make money in forex. What they were really interested in was the amount of volume I would be churning on a daily basis. ie. what kind of leverage I would use and how many trades per day I would execute. Literally, I could not find a single broker or hedge fund that did not ask me this question before looking at account statments going back 4 years showing an average of +6% returns per month.
One must ask "why is it that they don't care?"
The answer is pretty simple really. The more you trade (they love scalpers) the more money they make. FACT: Did you know that on average a broker will make ~65% of the value of each account per year? ie. If the combined accounts held at a broker total $100, 000, 000 they will make $65, 000, 000 in one year.
Now, we all know that 97% of traders lose money. Many of the brokers out there won't even route your orders to a bank until you prove to them that you can make money. This is why brokers go bankrupt and this is why you'd better make sure that your broker is insured either by fidelity bonds or some sort of insurance.
Moral of the story: Don't trust your broker even if it sounds like they are smiling over the phone... and do yourself a favour; do some research about your broker.
Regards,
Kal
To my surprise I could not find a single broker or hedge fund that actually cared about whether or not I could make money in forex. What they were really interested in was the amount of volume I would be churning on a daily basis. ie. what kind of leverage I would use and how many trades per day I would execute. Literally, I could not find a single broker or hedge fund that did not ask me this question before looking at account statments going back 4 years showing an average of +6% returns per month.
One must ask "why is it that they don't care?"
The answer is pretty simple really. The more you trade (they love scalpers) the more money they make. FACT: Did you know that on average a broker will make ~65% of the value of each account per year? ie. If the combined accounts held at a broker total $100, 000, 000 they will make $65, 000, 000 in one year.
Now, we all know that 97% of traders lose money. Many of the brokers out there won't even route your orders to a bank until you prove to them that you can make money. This is why brokers go bankrupt and this is why you'd better make sure that your broker is insured either by fidelity bonds or some sort of insurance.
Moral of the story: Don't trust your broker even if it sounds like they are smiling over the phone... and do yourself a favour; do some research about your broker.
Regards,
Kal