Spread betting at FXCM

Jason Rogers said:
Wanted to see if anyone has tried FXCM's spread betting platform since it was launched in March. Learn about Forex Spread Betting at FXCM Any feedback on the platform or trading execution? Would love to hear any pros/cons about your experiences.

Cheers,

Jason
Click to expand...

Hi Jason,
I've been looking at FXCM with a view to moving from IG and they look gr8 with a lot of back up stuff to browse. There are so many Spread Betting accounts available but this one's Currency specific which is my main area of interest. I'm going to start a Demo Acct with them and I'll keep you posted. Let me know how you get on...
All the best,
sk8fx 🙂
 
Hi sk8fx,

Thanks and let me know how it goes.

Couple of big differences from traditional spread betting firms is that there are no re-quotes. All of the spread bets are hedged real-time with a major bank of financial institution. And there is a no debit balance policy. I've heard a lot of horror stories over the past year of traders owing large amounts to their brokers for trades that moved massively against them.

-Jason

Some of the big differences between the traditional spread betters is that the FXCM
sk8fx said:
Hi Jason,
I've been looking at FXCM with a view to moving from IG and they look gr8 with a lot of back up stuff to browse. There are so many Spread Betting accounts available but this one's Currency specific which is my main area of interest. I'm going to start a Demo Acct with them and I'll keep you posted. Let me know how you get on...
All the best,
sk8fx 🙂
Click to expand...
 
"FXCM UK offers Spread Betting exclusively to UK Residents. Residents of other countries are NOT eligible"

I wonder why?
 
Because different countries have different gambling laws. Remember the issue with UK poker sites targeting US punters?? Also, spreadbetting has a tax exemption only in the UK - I know of no other country where this is the case.
 
Rainmaker said:
Because different countries have different gambling laws. Remember the issue with UK poker sites targeting US punters?? Also, spreadbetting has a tax exemption only in the UK - I know of no other country where this is the case.
Click to expand...

Rainmaker is exactly correct. We offer spread betting only to UK residents because spread betting is exempt from UK taxes.

The spread betting product is the same thing as our regular spot forex trading product, it's just classified as "spread betting" so that our UK clients can have the tax exemption.

There wouldn't be any reason for a non-UK resident to open a spread betting account since you're not reporting your income and capital gains to the UK tax authority.

If you want tax free forex trading there are 2 options: move to the UK or suggest to your national government to adopt the same tax exemption policy. 🙂
 
Jason Rogers said:
Rainmaker is exactly correct. We offer spread betting only to UK residents because spread betting is exempt from UK taxes.

The spread betting product is the same thing as our regular spot forex trading product, it's just classified as "spread betting" so that our UK clients can have the tax exemption.

There wouldn't be any reason for a non-UK resident to open a spread betting account since you're not reporting your income and capital gains to the UK tax authority.

If you want tax free forex trading there are 2 options: move to the UK or suggest to your national government to adopt the same tax exemption policy. 🙂
Click to expand...
Great to have a representative of FXCM present on this Forum.

Spread betting is still in most European countries considered to be tax free. What is the difference between the Forex brokers (non ECN) and SB? They are both market makers as I see it. You say you hedge all your bets. Do you by this mean every single one, or just what is not balanced out in the book? Please correct me if I've missed out on something here. No re-quotes, what about "price no longer valid", news trading or being referred to a dealer?

I don't think one has to move to the UK (even though I like the country), many SB are offering good spread on FX.🙂
 
Jason- what can FXCM do for me that IG can't. I spread bet 5 days a week. Are your spreads better. are your fills quicker, charting package, platform reliabilty etc.

I don't want a demo before you say it - just honest answers. Is FXCM better than IG.
 
Hi Claudia123, there was a member on some other thread that told me that spread betting was taxable in Germany. I was puzzled by his statement. Please could you confirm if this is the case.
 
gle101 said:
Hi Claudia123, there was a member on some other thread that told me that spread betting was taxable in Germany. I was puzzled by his statement. Please could you confirm if this is the case.
Click to expand...

Hi

I been living in uk for a year or so now. Believe it is taxable throughout mainland Europe but not 100% sure.
 
Claudia123 said:
Hi

I been living in uk for a year or so now. Believe it is taxable throughout mainland Europe but not 100% sure.
Click to expand...
Thanks. In Sweden it is not, at least not yet. I am quite certain it is the other way around, almost every country in Europe consider financial SB to be tax free. However, I am quite sure this will taxable in the years to come. If anybody else could fill me in on this, it would be welcomed.
 
ETX seem a bit shy about quoting spreads, apart from saying they're some of the tightest. Do they do 1pt on main European indices, 2 on Dow, etc, like the competition?
 
FXCM are very good, as a company, I had a mini account with them many years back, eventually this had a balance that was lower than the fransfer fee and not high enough to cover margin requirements to open a position.

FXCM transfered it back to my bank account, free of charge.

I had no problems with their trading platform, the service, or their spreads, which are were very competitive at the time.

they are also a very highly capitalised broker.

I would recommend them.
 
Last edited:
Hi gle101,

Happy to be here. Brokers and spread betting firms offer the same product, forex trading, but there are two methods of execution: market maker and direct market access (no dealing desk, straight through processing).

The majority of spread betting firms are market makers. They take the other side of all positions thereby profiting when you lose, and losing when you profit. This is a conflict of interest because it is in your broker’s best interest for you to lose money. Since a market maker can profit if the market moves against you, it is also common to get referred to a dealer when the price is unfavorable to the market maker. A good example of this is news trading.

With FXCM, every single order is sent directly to one of the 9 banks quoting on our system. As a result, FXCM does not profit when you lose money on a trade. Rather, we are compensated by marking up the price we receive from the bank. Thus, FXCM is strictly concerned with volume. Because of this there are no restrictions on trading styles or strategies such as scalping or news trading. There are no re-quotes.

-Jason


gle101 said:
Great to have a representative of FXCM present on this Forum.

Spread betting is still in most European countries considered to be tax free. What is the difference between the Forex brokers (non ECN) and SB? They are both market makers as I see it. You say you hedge all your bets. Do you by this mean every single one, or just what is not balanced out in the book? Please correct me if I've missed out on something here. No re-quotes, what about "price no longer valid", news trading or being referred to a dealer?

I don't think one has to move to the UK (even though I like the country), many SB are offering good spread on FX.🙂
Click to expand...
 
jason - so in effect you say you offer DMA is that correct? What are spreads on cable.

To say brokers and spreadbetters offer the same product is a bit misleading for some of the new guys here -- there are tax implications to be considered as you know.
 
Hi Claudia,

I would say yes, but then I am biased since I work for FXCM 🙂. There would have to be an independent source or analysis to make that statement. I would hope that whichever broker you trade through you have at least made an independent decision yourself by testing the platform, charting, and spreads.

What I can tell you is that your trades will not be delayed due to order restrictions, re-quotes or restrictions on your trading strategies which typically occur with market makers.

The spreads are variable as prices are provided to FXCM from multiple global banks. FXCM takes those prices and then streams through the best bid and ask price for you to trade on. Here is where you can see a list of our spreads Forex Spreads | Spread Betting . As trading volume and price competition increases you will see spreads decrease. And as trading volume and price competition decreases, spreads can increase.


Claudia123 said:
Jason- what can FXCM do for me that IG can't. I spread bet 5 days a week. Are your spreads better. are your fills quicker, charting package, platform reliabilty etc.

I don't want a demo before you say it - just honest answers. Is FXCM better than IG.
Click to expand...
 
Jason Rogers said:
Hi gle101,

Happy to be here. Brokers and spread betting firms offer the same product, forex trading, but there are two methods of execution: market maker and direct market access (no dealing desk, straight through processing).

The majority of spread betting firms are market makers. They take the other side of all positions thereby profiting when you lose, and losing when you profit. This is a conflict of interest because it is in your broker’s best interest for you to lose money. Since a market maker can profit if the market moves against you, it is also common to get referred to a dealer when the price is unfavorable to the market maker. A good example of this is news trading.

With FXCM, every single order is sent directly to one of the 9 banks quoting on our system. As a result, FXCM does not profit when you lose money on a trade. Rather, we are compensated by marking up the price we receive from the bank. Thus, FXCM is strictly concerned with volume. Because of this there are no restrictions on trading styles or strategies such as scalping or news trading. There are no re-quotes.

-Jason
Click to expand...
Thanks for your reply. If you don't give re-quotes, don't practice referral to a dealer and no other restrictions. That leaves pretty much slippage to watch out for. Well, I guess the best way is to try you out to see how well you execute. I am sure there will be some reports on this thread.
 
Yes, that is correct, it is direct market access. Cable spread is typically 3.7 pips getting as low as 0.8 during peak trading periods. However, by all means view a demo to compare.

As discussed previously with rainmaker in the thread, the tax implications is what differentiates the "spread betting" account from the regular rolling spot forex. If you compare the two one against the other, it uses the same platform, execution, spreads etc. The reason why there is a separate spread betting account offered is because it is free of stamp duty and UK capital gains tax for UK individuals.

Claudia123 said:
jason - so in effect you say you offer DMA is that correct? What are spreads on cable.

To say brokers and spreadbetters offer the same product is a bit misleading for some of the new guys here -- there are tax implications to be considered as you know.
Click to expand...
 
That is true. Slippage is one thing that can happen, but there are ways to control slippage. You have the ability to set market orders to fill as At Best or Market Range. At Best execution will get you into the market every time at the best price available. Market Range allows you to set a range of prices you are willing to accept, and it will fill at the best price in that range.

And I look forward to hearing about the feedback.

gle101 said:
Thanks for your reply. If you don't give re-quotes, don't practice referral to a dealer and no other restrictions. That leaves pretty much slippage to watch out for. Well, I guess the best way is to try you out to see how well you execute. I am sure there will be some reports on this thread.
Click to expand...
 
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