BY: Economic & Finance Report
Trading in the Forex markets comes with its rewards but also entails many risks. Knowing how to minimize the risk and outperforming to attain greater rewards is key in attaining a strong edge in the markets. In the week of January 12-16, 2015; the second full week of the New Year, the market witnessed probably one of the greatest losses in the forex and trading markets. The Swiss National Bank indicated they were allowing their Swiss Franc regulatory program against the Euro to be freely traded, and the reaction sent investors, traders, analyst, brokerages, market makers, and market movers into a windfall of turmoil.
Brokerages such as FXCM, one of the top retail forex brokerage in the US, were forced to attain a loan to cover their clients’ losses. The damages adhered were in excess of $300 million dollars USD. Private equity asset lenders had to come in to foot the bill. Financial banks such as Citigroup lost anywhere from $150-$200 million dollars, and other brokerages closed their shops indefinitely. Deutsche Bank (DB) lost excess of $150 million USD and Barclay’s Plc loss a little under $100 million USD. United Kingdom Brokers such as Alpari folded their uniformed shop and they are now gone in the oblivion because of this unfortunate Forex demise.
The wakeup call now places traders, especially retail traders in a tough position because of what happened underlying the Swiss National Bank. In the United States Forex and Futures is monitored by the NFA (National Futures Association) and the CFTC (Commodity Futures Trade Commission). These regulatory bodies have oversight on the futures and Forex markets and the regulations and rules are essential on what occurs in the Forex and Futures markets. So exactly what happens next from the entire debacle that had occurred? Well, once thing is quite sure, and that is retail traders now will be more on alert as discretional volatility will of course continue, maybe weeks and months ahead in this destabilizing Forex marketplace. –SB
About the Columnist/Writer:
Mr. Samuel Bassey is a Futures/Stocks/Forex Trader, based in New York City. He has an MBA in Media Management and is a licensed real estate professional and investor. He is the founder and operator of the international/global economic, finance, and business blog website called www.EconomicandFinanceReport.com, which he writes for as well; and he has a real estate property management/investing website entitled www.SammyBuyHomes.com. He can be contacted @ Samuelbassey@msn.com and info@SammyBuysHomes.com