FXCM Review: A Major Retail Forex Broker

Forex Capital Markets is a respected online brokerage based in New York City, not far from Wall Street. This is one of the most established brands in online forex trading; its operations date back to the late 20th century, a time when online trading was nascent and mostly limited to equity securities.

FXCM entered into an operating agreement with Refco, a major American provider of online futures trading, in 2003. Over the next two years, FXCM grew and expanded along with Refco; the company even established a presence in the United Kingdom with a London office. In 2005, FXCM suffered a legal setback due to the bankruptcy of Refco; nonetheless, the company bounced back in 2008 as the United States Commodity Futures Trading Commission increased financial requirements for forex brokers. FXCM jumped on the opportunity to acquire smaller competitors and was able to open new offices in Europe.

These days, FCXM is one of the most recognized names in online forex trading thanks to its liquidity, international licensing and its technology platforms.

FXCM Trading Accounts

Trading Accounts Offered by FXCM

The minimum deposit amount required by FXCM to open a Mini account is $50. This is a spread account with 1.4 pips and up to 400 leverage. The next account level is Standard, which can be opened with a $5,000 deposit in the U.S. and $2,000 outside of the U.S. The next level is for active traders who can deposit $25,000; the Standard and Active accounts impose a spread of just 0.4 pips with commissions no larger than $4. As can be expected, the execution of trades is faster and more reliable for Standard and Active traders, this is very important for individuals who hope to make solid profits without having to worry about negative slippage. Trades carried out on mini accounts are executed by means of a trading desk.

Trading Conditions

As a forex broker based in the U.S., FXCM is required to offer a maximum leverage of 1:50 to American traders. Through its international subsidiaries, FXCM offers up to 1:400 leverage.

The spreads offered by FXCM will vary according to the currency and account type. Major currency pairs such as EUR/USD can be as low as 0.2 for traders who take positions on active accounts. For most traders, the average spread is 1.4, tight enough for those who base their positions on technical analysis.

Although FXCM allows traders to use Bitcoin and speculate on the U.S. Dollar Index, this is a brokerage that mostly sticks to pure forex trading. At one point, FXCM owned and operated respected websites dedicated to forex news reporting and market research.

Trading Platforms and Customer Support

FXCM offers three trading platforms:

The Trading Station platform is highly recommended for traders who are experts or just starting with forex. Micro lots can be traded easily on Trading Station, and the various options, alerts and traditional strategies that can be set make it a forex platform that will meet the needs and styles of any trader.

The web-based FXCM trading platform is mobile-friendly, but traders get a better experience from the dedicated iOS and mobile apps available.

In terms of customer service, FXCM answers email, telephone and online chat queries 24 hours a day while the forex market is open. There is multilingual support available. FXCM has earned various awards for its level of client support.

Compliance and Reliability

Through its early partnership with Refco, FXCM was able to gain entry into the U.S. National Futures Association, which gives the company very high standing among its peers.

FXCM is one of the very few online forex brokers based in the U.S., a jurisdiction that is very strict and heavily regulated. By virtue of its listing on Wall Street, FXCM is also regulated by the U.S. Securities and Exchange Commission. FXCM holds equivalent licensing and registration in all the countries where it does business.

Despite this company’s penchant for compliance, the company has seen its share of fines and administrative action due to technicalities and other situations that have resulted in conflicts with American and British regulators. Nonetheless, FXCM has one of the best track records in terms of compliance.

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