Too Good To Be True? - Forex Forum

Hi,
I am playing with demos for a while and finally I have decided to go real with small amount. I have chosen fxcm micro from the brokers listed on mataf.net and I am quite happy with the spreads, trading platform etc.

Last week when I have been browsing around I found Forex online broker wit attractive promo. I will not post the name of the broker for to not my question be misinterpreted like scam or advertising.

As my experience have already learned me I have to be coutious if something is too good to be true.

The broker offers to me 50% bonus on every amount I will fund my account up to $800 - so I actually get $1200 and the only condition is that I can not withdraw the bonus (this sounds logical) before certain amount of trades.

My question is if there are reason that I am suspicious and if yes where is the catch?

This is part of their email:

"XXXforex offers you much better bonuses than 100$!! I can offer you 50% bonus for any amount you want to fund your account at the first time up to 800$!! This will give you more margin into your account.
About your questions;
· Our spreads are customized for each client and the spreads you get is the spread you trade. A lot of brokers tell you they give you 2 or 3 pips, but, when the market is volatile, they will raise the spreads without you knowing. This does not happens with us.
· I can customize your account to begin trading with only 2500$ it means 0.25$ a pip
· There is no minimum withdrawal amount. You will be able to withdrawal the money you have invested and your profits at anytime. The bonus, indeed you can withdrawal only when you make a certain volume of negotiations into your account. The money goes back to your credit card up to the amount deposited, and the spare profit to your bank account ( the bank charges a 30$ fee).
XXXForex does not only offer you the best environment on the market to trade FOREX. We offer you 24/7 support with on over 10 languages"

Thanks in advance if someone will decide to give me advise

And the guy is quite in hurry?! He is calling me on my mobile twice which not seems usual for Forex broker.
he is writing:
Yes, you can trade with 1000 position, it will mean 0.10$ a pip. And yes, if you fund your account today with 800$ I will give you 400$ bonus!!
You can fund your account simply logging in to your account with your username xxxx and your password, that you got on your email when you registered.
Inside the platform, on the left side you will see de DEPOSIT button. Feeling in with your details, the money will be into your account in a few seconds.
As soon as I see your money into your trading account, I will provide you with the bonus and the minimum position value.

If the broker offers a bonus he probably works with a dealing desk: he keeps the order and only cover the complete book.
The advantage for the broker is simple: most of the traders lose their money; if the broker doesn't place the order in the market then he keeps for itself all the money of the trader, and not only the spread...

He can give you a bonus because statistically traders lose...

Thanks for the explanation. I got suspicious of their attitude "Give us your money ASAP".

He is calling you on your mobile !!!!

Come on and you are still asking if it is suspicious ???

Statistically little accounts (less than 1000$)lose,
but it is not the broker making you lose!
The statistics are high because most of the forex traders are inexperienced and not conservative enough to keep steady profits, they start earning fast and want more and more and lose everything, U need to keep it slow and trade on medium leverage.

So now it is your turn to make your proofs...
I know about brokers and stuff, if you need more information ask me
enjoy

No, it's not the broker. I read an interesting article "Why Does The Average Forex Trading Strategy Lose Money?"

Yeah the article is very good Arnaud Jeulin i also think the most important reason most of the forex trader is on the losing side even though there are so many indicator, strategies, fundamental or technical technique only is indiscipline. When traders lose some amount initial, he start thinking of some different strategy, which cause more, then originated. If trader starts believing in there, strategies even after of some loss then I am sure the situation will be soon under control.

I agree with you all. If you trade with a low amount, chances are, you win very little and lose very little. Of course, you also need to be careful with brokers. How do you know you are being conned? Here are a couple of warning signs:
1. They offer get-rich quick schemes. Forex trading like anything else, requires practice. If you win in your first few real trades, it's probably just beginner's luck. It is still best to trade with a demo account for at least 1-2 months so you can get used with your trading platform.
2. They guarantee large profits. Remember: the higher the yield, the higher risk you take. If they offer you a huge profit, make sure you read the fine print so you know the exact conditions when this profit is released to you.
3. They offer no financial risk. When you invest, you will always have to risk. If it's not your money, then it's something else.
4. Don't deal with brokers which have no background. Check FTC. Ask your friends. Research on the internet - it's very easy to find the history of a brokering company.

If you want to know more about forex scams, you can read this document from the FTC: http://cftc.gov/opa/enf98/opaforexa15.htm