CFTC 101 Leverage Proposal on Retail Forex Trading

As you may know, U.S. Commodity Futures Trading Commission (CFTC) proposed regulation in early January that would dramatically reduce leverage now available to forex traders in the United States. The proposal states that" leverage in retail forex customer accounts would be subject to a 10-to-1 limitation."

Current Margin Requirement Margin Requirement at 10:1 Leverage

EUR/USD: $160

EUR/USD: $1,600

USD/JPY: $100

USD/JPY: $1,000

GBP/USD: $180

GBP/USD: $1,800

USD/CHF: $100

USD/CHF: $1,000

While we believe that increased regulation brings credibility to our growing industry, this proposal jeopardizes the freedom of individuals to choose their desired risk, directly affecting all traders who consider leverage paramount to their trading strategy.

What can you do about it?

The CFTC is seeking public comment on the proposed regulations. If you feel strongly about maintaining the leverage you now enjoy with your broker, we urge you to speak out to the CFTC. You can voice your concern by sending comments directly to the CFTC by March 22,2010.

Send e-mails to:

[email protected]

Include "Regulation of Retail Forex" in the subject line.

The United States Foreign Exchange Dealer's Coalition is joining traders in this fight to maintain flexible leverage and is actively working to repeal the CFC's proposal.

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