2.11 Defending Yourself Against Forex Scams

O.K., you’ve just opened your account, funded it, and are raring to go trade! Well, you haven't really unless you are ready to go ahead and burn your fingers before you get thru the nitty gritties and get your graduation degree. But safety first, right. So let's see have a look on the possible road bumps before you start the Forex trading journey - To make sure that the journey becomes a long one and not a 5-minute morning walk in the neighborhood park. You with us? Better be ... 
Before that, just do this search and go through some of the results:
How to protect yourself against Forex broker scams.
How to keep safe against forex bucket shops.
Don’t believe all you read in the search results. But, regrettably, all of it is not false either! Horror stories run from concocted and artificial rates, mysteriously wideningHow to take legal actions against Forex brokers. spreads and stops hit due to spiked rates. Don’t get alarmed and decide to give up on FX trading – it’s not the solution.
Forewarned is fore-armed. How can you protect yourself? Here are a few keep-safe practices that will stand you in good stead in your trading career.
  • Compare, compare! Periodically, keep checking the quotes you get from your broker with other price information. Something is wrong if the quotes you get always compare unfavorably with what you see on some other, independent price feed.


  • Backup. Keep an audit trail of your trading activity. This could include paper notes, excel records, screenshots and electronic diaries to record every detail – immensely useful in case of a dispute. If you feel cheated and raise a dispute, the broker is likely to take you seriously when he realizes that you have back up data to prove your Know your legal options. Before commencing trading with a new broker always check his registration with the appropriate regulatory body. Then check that body’s dispute resolution procedures and rules. Be aware that in the case of a genuine complaint you can always hope to be compensated by the broker under the orders of the regulatory body.


  • Disciplined trading. Remember that in the long run, disciplined and safe trading is the only route to success in the FX market. The occasional glitch (maybe, dishonest) can be taken in stride, but sloppy trading will, in the end, take you out of the market, with or without crooked brokers.


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