Hi
CFTC has now changed some of the rules which permit brokers to use clients money for there own business.
CFTC completes client-funds rule after MF Global collapse - The Washiongton Post
"The rule approved today will overturn a policy, instituted in 2005, that let brokers invest client funds in in-house transactions. It will ban such trades by brokers, who earn interest income by investing funds from segregated accounts, while allowing third-party deals, according to a CFTC summary.
Brokers will also be permitted to invest client funds in U.S. Treasuries, municipal debt, money-market funds and debt of Fannie Mae and Freddie Mac as long as the two housing finance companies are under the conservatorship of the Federal Housing Finance Agency, according to the summary."
My comment to the above:
Not a big change. We will have to live with it if we have a trading account in the USA. There wont be more changes as far as the information I given to. We only can hope, that it is done again with huge care.
On the other hand: Even this rules and no other rules can protect us from CEO's which allow and order to steal money from customers account. Hopefully such a case like MfG will not happen again in the USA. A bad smell has the situation for all affected as for the moment still no body really held accountable.
Final point as mentioned in previous posts: Split up your money to different brokers and choose brokers which mainly concentrate on the main vanilla business: Clearing for their clients. There are a lot of smaller firms out there that are doing nothing else and have no ambition to do else.
If you have any questions, use this link from the National Future Association USA: NFA - National Futures Association. Here you go to: BASIC Search and here you will find information about any legal broker in the USA. Check this before you choose one. And here a link from the CME to its: Broker Directory.
I hope, this thread was informative for you and I am now sure, that you know the risk you face with an American based trading account and what you can do to reduce this risk.
Good and successful trading
Black Panther
Its not about the money, it is about the trade. Money is the byproduct of the trade. Make a good trade and the money will follow...
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