Forex and Domain

The new rules of the CFTC regarding forex imposed limits of leverage which angered many merchants. Nobody likes to be retained. But, after 6 months, there is evidence that these limits may actually be helping traders make more money.

On 18 October, the new leverage limits came into force: 50: 1 key pairs and 20: 1 in the other. It was worse than the initial proposal of 10: 1, but it still caused fury and thoughts that traders would move their accounts to foreign dealers.

Another rule made by the TCRC to see the number of traders in each account and rate of return. You can see a summary of data from the first quarter of 2011 here nice.

First of all, we see that the number of accounts to the United States has not declined. Not yet. It has even increased. Of course, it is arguable that the number could be increased if no restrictions were imposed.

But look at the rate of return. This has actually increased. The percentage of traders profit on forex we is on the rise.

It is also important to note that this increase comes from more stringent rules concerning the definition of "profitable accounts" - the new boundaries exclude accounts that were not active, but received "benefits" paid interest. See which key brokers are in this area.

How this is so?

The reason for no. 1 that new merchants burn their forex account is due to poor management. They are likely a large part of their account in each trade. Since they are inexperienced, they lose money quickly and do not have the chance to learn, that their account has disappeared until they understand what they are doing.

With the new limits of leverage, they are forced to risk less, which means that they can afford more reasonable judgments and can afford a few losing trades until they pick up the game.

It will be interesting to see if this is a trend of improvement of profitability or is it just a coincidence, many factors influence on profitability. I believe that this trend will continue, given that improving the management of money, that you want or not.

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