The forex broker’s paperwork that is silently draining away your bank account and forex capital - free online forex trading demo account

The forex broker’s paperwork that is silently draining away your bank account and forex capital ~ free online forex trading demo account

In our ongoing series on forex brokerage chicanery, we show today how the immense detail in the paperwork you sign with your forexbroker goes a long way in determining whether or not your trading portfolio will extend beyond your current forextrading capital to your personal bank account. For some beginners trading forex on the live charts, the possibility of success in the forex market is foreclosed the moment they sign that trading contract with the broker. Most forex beginners, probably out of excitement, ignorance or a combination of both, sign these trading agreements without reading the details involved.

Whenever you are in the process of signing a trading agreement with a forex broker, hold on before you click on that ‘OK’ button. Read the terms of the trading agreement first because vitiating the terms of a contract entered into through the normal procedures of offer and acceptance is next to impossible if the parties were of majority age and sane. The forex broker will always use the terms of the contract to frustrate or throw out your claim or complaint however plausible it may seem. If you are not sure of a term or clause in the contract, seek for legal aid or ask the forex broker for further clarification. That way, you will hold him on to his word.

There is one disturbing clause in most contracts entered into between a forex trader and the forex broker- that the forex broker will have access to your bank account at all times that the brokerage relationship subsists. The clause gives the forex broker a cate blanche in dealing with your bank account money whether or not you planned to trade with it. It catalyzes the forex broker’s arbitrariness in his dealings with your personal finance.

The lasting impact of this clause is that forex brokers will always let you open a position even when they know (they always know) that you do not have sufficient margin to hold onto that position. The moment you’ve opened the position by entering a trade, your bank account will be credited with whatever amount to support the trade. You should be worried when trading forex extends beyond your forex account into your bank account.

Forex brokers have also manipulated how they deal with your pending orders.  A pending order is a type of market instruction that will not be executed until the market reaches the traders specified level, provided that any other conditions have also been met. This implies that technically you are not in a trade until a specified level is reached. But forex brokers will credit your account the moment you enter a pending order. Lawfully they should wait for the pending order to be activated before they credit your account. The effect is that the choice to exit the pending order before it’s executed is done away with because you have already paid for it. So you’ll have to watch and pray that the market does not go against you.

We conclude this part by asking every forex traderto read again and again the terms of agreement with the forex broker. You may not be a graduate of Harvard Law, but some things will never escape your eye if you remain vigilant. You might as well renegotiate the trading agreement and get yourself favourable trading terms. Be on the lookout for the forex brokerage chicanery if you are to trade only when and the amount you had hoped for. Next week we will show how forex bonuses are used to lure and trap unsuspecting forex beginners.
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