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Originally Posted by forex scholar
Oh but you are discredited Whipsaw. The NFA has vindicated all of my points about the dangers of being poorly capitalized:
http://www.nfa.futures.org/news/new...?ArticleID=1942
And they have taken action. The minimum capital requirement has been raised to $5 million. You are indeed discredited... |
and the board decided that members must maintain at least 2x the net capital requirement to be able to get exempted from Section 12(a). Sounds pretty much that they are concerned about the multiple and they use it as a warning sign, companies must maintain 2x net capital requirement or else they can only offer leverage of 100x on majors, and 25x on exotics
(as far as I understand it) .
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NFA's Board, however, believes that the security deposit is an important risk-management tool and that the current levels-which allow 1:100 leverage for major currencies and 1:25 leverage for all other currencies-are not burdensome. Therefore, the Board voted to retain the current requirement that an FCM maintain twice its required capital in order to receive the security deposit exemption.
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