“The Evil Tricks Your Forex Broker May Be Doing To Steal Your Money: An Inside Look Brought To You By TradeX1”
There are two types of forex trading brokers. The first type involves the broker who is a DD. These are the Dealing Desk Brokers. They are also called the Market Makers or the Dealers. They get their information through spreadsheets and are obligated to provide their clients with genuine information. They have no choice because of a legal contract. They also take the opposite side of their client’s trade.
The second type is known as the NDD. These are the Non-Dealing Desk Brokers. All they do is link their client’s trade to a market platform and charge a fee for it. There are pros and cons to working with either of these types of traders. The one thing you do want to watch out for, according to Trade X1, is the cheap tricks they use to steal your money.
Make no mistake, both types of traders are equally at fault for employing such tricks. Your job is to keep your eye out for when it happens. The sooner you notice it, the more you can prevent them from taking your money.
Winning Their Client’s Trust
They do this by inviting you into official web pages. They use official sources to gain your trust and swoop in. They encourage their customers to trade on a margin or set stop loss orders. This is when the client closes out during the market’s strongest times. The goal is for the market to offset the trader’s position. When this does not happen the market reaps the rewards and the client gets the loss. The broker makes money on this in a big way.
Extra Interest Rates Overnight
According to TradeX1.com, this is another way the broker can cause a loss on their client’s end. Chad employs a strategy. His broker spends the swap and charges more than what is needed. The broker may pay the swap and pay less than what is needed. What happens when the gap is small? Chad pays on both sides of the coin. Since Chad is unaware of what his broker is doing his broker gets away with it.
Widening the Spread
This is going to happen during times of high volatility. Chad’s broker may fail to allocate the spread, either intentionally or unintentionally. His broker is going to choose to widen the spread. In Chad’s case, there is nothing he can really do about it. There are no laws preventing his broker from doing this. This is one of the rare cases when Chad is stuck.
Chad’s broker is more than happy to offer him large volumes of trades. Since Chad is none the wiser, he takes the volumes happily. It is not illegal, but it will take advantage of Chad’s psyche. All Chad can do is make better choices when it comes to picking his trades. This will only benefit his broker; not him.
Liquidity provides change prices very fast. Chad may not have a choice with some of this. He may have to take the worst price on the market. This is another trick of the trade that brokers use, but it is not illegal. What the broker will do is offer Chad a currency pair at either a higher or lower price than what is being offered. Chad is going to be hard-pressed to find a broker that does not do this. All Chad can do is be more aware of this moving forward.