Is your introducing broker (IB) registered?

Foreign exchange rates expressed in American terms as of 8:42 am.

Currency pair	Federal Reserve (1)	x-rates.com	OANDA
EUR/USD	1.0887	1.0876	1.0891
GBP/USD	1.2701	1.2668	1.2625
AUD/USD	0.6687	0.6635	0.6617
NZD/USD	0.6149	0.6094	0.6074
CHF/USD	1.1137	1.1118	1.1134
JPY/USD	0.0070	0.0069	0.0069

1. These rates are average rates compiled by the Federal Reserve System as of 23 June 2023. 

Is your introducing broker registered?

I don’t know about you, but it can be annoying to get hit with requests to connect by someone who is ready to show me how to trade options or forex. They provide you with a backstory that is likely fake; show you printed checks or balance sheets that you cannot corroborate; or show you websites filled with red and green Japanese candlesticks containing likely phony information.

Consumers are getting wise to the tactics, so now these individuals are reportedly using a philanthropic model i.e., help support needy kids in Africa and we’ll discount your first trade or creating chatrooms where you can access allegedly high value information after you pay a subscription fee.

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Should the labor markets worsen, I suspect the number of individuals holding themselves out as trade instructors or introducing brokers to increase. They will try to prey on a consumer’s search for higher yielding products and other investment opportunities.

One way to protect yourself, particularly in the retail foreign exchange market, is to vet individuals that hold themselves out as brokers or instructors. Ask about their background as traders. You should not accept instruction from an instructor who has no or very little trading experience.

Also, ask the alleged broker if they are registered with the Commodity Futures Trading Commission and are members of the National Futures Association. If they are holding themselves out as retail foreign exchange dealers or affiliates of dealers, they should also be registered and hold membership.

Alton Drew

30 June 2023

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