» Press Release

(New York, January 22, 2008) FXCM’s No Dealing Desk trading platform recently added an additional bank as a price provider, bringing the total to seven global banks that compete to provide pricing for FXCM’s Trading Station. Over the last three months, typical spreads have already tightened.

Watch closely for lower spreads in the following currency pairs:

EUR/USD Typical Spread: 2.3 pips, As Low As: 0.9 pip
EUR/CHF Typical Spread: 2 pips, As Low As: 0.1 pip

“FXCM’s No Dealing Desk trading platform aims to provide transparent and fair execution. Every trade is executed back to back with one of the world’s premier banks, or financial institutions, which compete to provide FXCM with bid and ask prices,” said Drew Niv CEO of FXCM. “The best spreads available to FXCM are streamed to you with a small mark-up, which is generally one pip or less for major currency pairs.”

I tested the spread on the demo platform but I have 2.6 pips on EUR USD and 3 pips on EUR CHF (look at the screen shot). The press release is optimistic… But I think the spread is not the most important, a broker who not take position against traders is important. FXCM with 7 banks as price provider shows a good trend for forex brokers.

Forex Capital Markets LLC (FXCM) announced that the Refco estate agreed to sell its 35% ownership interest in FXCM to Long Ridge Equity Partners (and affiliated entities) and Lehman Brothers.

New York, December 3, 2007 — Today, Forex Capital Markets LLC (FXCM) announced that the Refco estate agreed to sell its 35% ownership interest in FXCM to Long Ridge Equity Partners (and affiliated entities) and Lehman Brothers. The financial terms of the transaction were not disclosed.

The announcement of the sale was made today by Drew Niv, CEO of Forex Capital Markets LLC (FXCM), the Wall Street currency trader.

“We are extremely pleased with the outcome of the auction,” said Niv, “and we look forward to Lehman Brothers and Long Ridge becoming shareholders in FXCM. We believe Lehman Brothers’ expertise in the global foreign exchange market and insight into growing our business will be extremely beneficial both for our company and for our clients.”

Upon completion of the transfer of ownership:

• FXCM will no longer have any financial connection or business relationship with the Refco estate;
• Five investors, including Long Ridge FXCM, L.P. and Long Ridge FXCM Coinvestment, LLC, are purchasing 25.1%. Lehman Brothers has agreed to acquire an equity stake of 9.9%.
• The FXCM Board of Directors will be composed of seven members. Five seats will be held by original founders of FXCM and two will be held by members nominated by the new investors excluding Lehman Brothers;
• There will be no change in FXCM’s management, operations or services.

Refco Exits As A Shareholder

“As a result of the transfer of ownership, the Refco estate will have no equity stake in FXCM,” said Niv. “Replacing Refco as a shareholder will be a positive in the marketplace, enabling the industry and individual traders to focus on FXCM’s strong financial position, its growing business and its product innovations.”

No Change In Leadership Or Management

“The results of the auction will change neither the leadership nor the management of FXCM,” said Niv. “The investment being purchased constitutes a minority interest in FXCM. The original founding partners of FXCM still control a majority of 5 of the 7 seats on our Board of Directors, and will collectively make all major decisions. The new investors are fully in sync with management’s plans, so FXCM will not be making any changes in personnel, operations, or strategic direction as a result of the auction.”

A Vote Of Confidence For The No Dealing Desk Model

“The no-dealing-desk trading platform we have developed allows currency traders to receive prices provided to FXCM, from some of the world’s largest banks, who, offer us some of the most favorable rates. We believe this business model points the way for all retail currency trading in the future,” said Niv.

NFA increase the minimum net capital requirement for Forex Dealer Members (FDMs) to $5,000,000. I received from FXCM their financial data.

• Over $120 Million in Capital (Assets Minus Liabilities)
• Over $96 Million In Operating Cash (Excludes Client Funds)
• Over $296 Million In customer cash (with over 90′000 live account it represent around $3000 per customer)

These results make me confident with the solidity of FXCM.

Forex Capital Markets, LLC announced that they have opened four new currency pairs to clients for trading on certain account types:

• Great Britain Pound/Canadian Dollar, 8 to 10 pips spread
• Great Britain Pound/New Zealand Dollar, 15 to 17 pips spread
• United States Dollar/Danish Krone, 6 to 7 pips spread
• Australian dollar/ Swiss Franc, 4 to 5 pips spread

The GBP/CAD, GBP/NZD, and USD/DKK will be available with 100K accounts through FXCM.  The AUD/CHF pair has been opened to all FXCM account types.  The expansion means that the brokerage firm will then offer twenty-eight unique currency pairs to clients.

Spreads are interesting regarding the volatility of those pairs. I just tried the demo account but I only found 12 pairs instead of the 28 promised in the press release. :(

All the pair I trade are in the selection but maybe you need one or two more. What currency pairs would you like to see FXCM add?

The FXCM Group announced today that accounts with Forex Capital Markets, LTD (FXCM UK) are fully segregated in accordance with UK financial regulations. FXCM UK accepts accounts from the United States and over 100 countries.
In the unlikely event of FXCM UK’s bankruptcy, clients of FXCM UK would be considered secured creditors and receive priority in bankruptcy proceedings.
The FXCM Group is offering this option through its UK affiliate because funds held by US-registered Forex Dealer Members are not segregated. If a Forex Dealer Member becomes insolvent, clients do not automatically receive priority status in bankruptcy proceedings.
Recently, a US-registered forex broker went into receivership due to undercapitalization. Clients of the broker were unable for a period of time to access their funds and faced the possibility of financial losses. This situation may recur as current capital requirements for US-registered forex brokers are minimal.

Drew Niv, Chief Executive Officer of the global currency trading firm, stated, “FXCM is offering segregated funds through FXCM LTD as an additional value to our clients. While FXCM is the largest, most financially secure US–registered Forex Dealer Member, we still want to provide our clients with additional legal protections for those that want their funds segregated.”

“Many forex firms are teetering on the brink of bankruptcy; FXCM is strong. We believe that it is vitally important that all currency trading clients have complete and verified information on the financial strength of forex trading firms. That is why FXCM has taken the major step of making our balance sheet public, and challenged other firms in the industry to follow our lead.” said Niv.

Read the complete press release : FXCM LTD Segregated Funds

The FXCM Group announced today that it has changed the name of its subsidiary, FXCM LLC to FXCM Futures LLC. The purpose of the name change is to avoid confusion between Forex Capital Markets LLC and FXCM Futures LLC.

FXCM Futures LLC is a Futures Commission Merchant (FCM) and will be offering exchange traded futures products. The firm has not yet started to accept clients.

Forex Capital Markets LLC is a Forex Dealer Member (FDM), a sub-category of Futures Commission Merchants. Clients opening accounts through the website www.fxcm.com are trading through Forex Capital Markets LLC.

Both firms are listed on the CFTC’s Monthly Report “Selected Financial Data for Futures Commission Merchants” available at http://www.cftc.gov/tm/tmfcm.htm; which enables the public to see the net capital of all FCMs.

This report has gained attention over the last few weeks as members of the forex trading community have reacted to the NFA proposal to raise the minimum adjusted net capital requirements for Forex Dealer Members (FDM) to $5 million.

Many clients of Forex Capital Markets LLC have checked the report to see the relative standing of the firm. Should the proposed NFA capital rules go into effect, Forex Capital Markets LLC would far exceed those capital requirements. Forex Capital Markets LLC has an adjusted net capital of $55,668,469 as of May 31, 2007, the most recently released report.

FXCM Press release