Why would you choose Forex.com as your top online trading service provider? Should you choose it as such, at all? These are the questions we shall attempt to answer in this review, while taking a closer overall look at what the brokerage peddles.
Forex.com is a global market leader in online FX and CFD trading. Launched in 2001, it is indeed one of the veterans of the global online trading scene too.
The operation offers quality trade execution and very competitive spreads. There is just one issue with the whole setup: Forex.com is apparently a market making broker, which means that it trades against its own clients.
This conflict of interest is one that is extremely difficult to explain in the case of this broker. The fact the Forex.com is one of a handful of online brokerages licensed to legally peddle their services in the US, does not make it any easier to understand.
In addition to its great trading conditions, Forex.com also offers traders a wide range of trading tools, a superb selection of trading platforms and an outstanding pool of tradable assets, which cover the most interesting and dynamic asset-class: cryptocurrencies, too.
The corporate entity behind the Forex.com brand is GAIN Capital Ltd. Now then, GAIN Capital works both sides of the Atlantic, so to speak, meaning that it has a branch in the UK, called GAIN Capital UK Limited, and one in the US, called GAIN Capital Group LLC.
The operation boasts a regulatory profile which is indeed very difficult to replicate by any competitor.
The US branch of the brokerage is a member of the National Futures Association (NFA) and it is registered with the CFTC. It would indeed be interesting to know what the US regulatory authorities make of the fact that the broker is a market maker.
GAIN Capital UK Limited is a company registered in England and it is licensed and regulated by the FCA. Despite the fact that its FCA license theoretically gives it access to the whole EEA, Forex.com does not offer trading services in Belgium.
In addition to the above jurisdictions, Forex.com is also licensed and regulated in Australia, Canada and Hong Kong.
Transparency is the name of the game at Forex.com. Despite a somewhat shady approach to the setup (given its market-maker status) the brokerage details all costs associated with trading on a dedicated page on its official site.
Execution scorecards and cash rebates are covered in a similar manner.
One Click Install EA Packages
- Alarm Manager – Customize alarms for balance, margin, P/L, consecutive wins/losses, and more
- Correlation Matrix – Assess hypothetical scenarios, highlight strong or weak correlation between all markets
- Correlation Trader – Inspect historic correlation between symbols in more detail and watch for, and trade, emerging differences in that correlation
- Market Manager – Current open position and profitability for each symbol, quickly switch between different groups of symbols, ability to place new market and pending orders
- Mini Terminal – Simple fields for setting orders in pips, open position marker, templates, and risk calculators, and more
- Sentiment Trader – Current long/short sentiment for a market, dashboard of current sentiment for multiple symbols. Sentiment data is from FXBlue.com
- Session Map – Shows current active session with the user’s local time as a reference point. It also includes an integrated economic calendar and key market changes.
- Tick Chart Trader – Simple tick chart which updates every time the ask or bid price changes, tick chart plus tick speed: shows bars indicating how long the last N ticks have taken to form, indicating market activity, and more
- Trade Terminal – Pop-up dealing form for creating pending orders as well as market orders, ability to create templates for quick order entry, displays key symbol information (pip size, value per pip etc)
The US version of the brokerage features a much shallower market-coverage than its international variant. US traders can only access FX pairs, Gold, Silver as well as Futures and Futures options. No cryptocurrency markets are covered.
International traders on the other hand, get to trade Forex, Indices, Shares, Commodities as well as cryptocurrencies.
More than 200 global assets are covered, among them more than 80 FX pairs, 90+ shares and 4 of the most popular “blue chip” cryptos: Bitcoin, Ethereum, Litecoin and Ripple.
The spreads on crypto/fiat pairs are obviously quite massive. For the BTC/USD pair for instance, spreads start from $70. Given the volatile nature of these assets though, that is hardly a surprise.
Even on some of the more popular currency pairs (like the AUD/CAD for instance) the spreads can be rather steep though (starting from 1.5 pips).
Forex.com Trading Platforms
The Forex.com trading platform offer is centered around MT4 – a rather logical choice indeed. Downloadable for free at the Forex.com website, MT4 is available in several versions: there’s a traditional desktop version, a Web-based version and a mobile one, as well as a special version for those looking to run EAs.
In addition to all of MT4’s usual bells and whistles (scores of drawing tools and technical indicators) the Forex.com version comes with integrated Forex.com research, Autochartist trade ideas as well as Reuters news and Trading Central Access. The span of time for which one can access Trading Central depends on the account type one signs up for.
The EA-focused MT4 version supports all EAs obviously. Through this platform, traders can even build their own EAs if needed.
The mobile apps are also available for free, and they too support most of the features the full versions do
Another platform option supported by Forex.com is the Advanced Platform. This platform option provides access to professional analytic tools and advanced charting features.
There are more than 100 technical indicators supported, and no fewer than 15 time frames.
Trading can be done directly from the charts.
In addition to all the above, more than 100 trading strategy templates are also available. These templates can be used as they are, or they can be customized by traders, according to their specific needs.
Those with programming skills are welcome to create their own strategy templates from scratch.
Forex.com’s web trader can be used through any browser, and it too comes with some rather impressive trading/technical analysis tools and options. In addition to these, the platform puts a Reuters news-feed and an Economic Calendar at traders’ fingertips.
Features of Web Trader:
– Smart trade ticket with advanced risk management option
– Pre-defined and customisable layouts
– Powerful charts with integrated one-click dealing
The Mobile Trader allows for personalised full screen charts, and it too supports a plethora of analysis-focused tools.
Forex.com Account Types
In this regard, the brokerage has not gone overboard at all. While Demo Accounts are indeed available for every one of the above-detailed platforms (they’re good for 30 days), in real money terms, there’s just one option really.
The minimum required deposit for a real money account is $50, but the broker “warmly” recommends that traders make an initial deposit of at least $2,500, to give themselves a proper chance at success.
Traders who can afford to invest at least $25,000 into the venture, gain access to Premium Account privileges. This option is obviously not for everyone though.
Forex.com feature a vast and exhaustive FAQ section, which does indeed contain the solutions to the majority of the common problems traders may encounter.
Account forms are also readily available (complete with explanations/guides) for those who want to alter their account-data.
Toll-free phone numbers are available, for account-opening issues as well as for general support, together with email addresses.
Forex.com accounts can be funded through credit and debit cards as well as bank transfer.
With the credit/debit card method, deposits are capped at GBP 20,000. Through bank wire, traders can transfer an unlimited amount.
The education section of the Forex.com website is quite massive. It is structured into three main categories: beginners, intermediate and advanced. The sections cover basic trading concepts and lingo, risk management, as well as technical and fundamental analysis.
Specific trading strategies – like the trading of the NFP – are discussed in detail as well.
Everything thrown into the mix, Forex.com is a very solid trading destination indeed. Despite the fact though that it offers a superb selection of trading platforms and tradable assets (as shown above), coupled with decent trading conditions, its reputation is definitely not what it should be.
There are scores of trader complaints posted at various rating portals, the majority of which decry the fact that the brokerage acts as a market maker.
This way, it is obvious that it trades against its clients, which means that the primary interest of the operator calls for its clients to lose. Not a good basic setup…
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