Refco and Oanda
I would like to add to the discussion. I have been with Oanda for 3 years. It is unlikely I would have ever become a successful trader without them. When I first got into trading I just assumed I would be trading stocks…had no idea Forex even existed. Whilst doing my due diligence on “Online Brokers” back then Oanda stood out head and shoulders above all others in terms of their technology but more importantly, their corporate philosophy. Their openness on these forums, interest calculated and paid by the second, the ability to trade any size at all with no minimum account balance…there were so many things that came together for me and said “Yes, this is a firm that exudes integrity”. I’ve read enough on these forums over the years to know that most of their clients agree.
Now, to the matter at hand. I have been trading a real money account and as of tomorrow it will be one year to the day. This past year has been a very successful trading year by my standards given it’s my rookie season. As I approached this anniversary my wife and I agreed to ramp up the size of our trading account considerably. At the time I was unaware of the Mathemeticians sage advice to spread your grubstake around but it was certainly my intention to do so. It just made good sense and was the only way I would sleep at night. After exploring a lot of online Forex dealers and reading endless customer agreements, filling out endless account applications, etc., etc., (you know the drill) I settled on 3 brokers. It wasn’t 3 weeks after opening my account with Refco that everything “hit the fan”.
The first thing I did was put in a call to the CIPF (Canadian Investor Protection Fund) of which Refco Canada Co. is a member and of course was one of my primary reasons for choosing them. Mine was the first call judging on the reception I got which was basically “Refco who???” Suffice to say when I called again a few days later they were very well versed in the “Refco Affair”.
I’ll try to cut to the chase here. I resisted the temptation to jump off the ship because I felt comfortable with the fact that my funds were insured. The complete Refco story has yet to be told and there is still a chance a portion of my trading capital could get tied up in a receivership if Refco Canada Co. becomes insolvent. I cannot stress enough how much comfort the CIPF insurance has given me throughout this whole debacle. My question for Micheal Stumm and Oanda is this: Are there any plans for Oanda to register with the IDA (Investment Dealers Association)in Canada? As I understand it, members of the IDA automatically extend CIPF coverage to their clients by virtue of their membership.
I realize that Canadian traders are likely in the minority here so this may not be the ideal overall solution to help offer protection for all Oanda clients. Some brokers are offering a fidelity bond that would give similar security for customer accounts.
Please forgive my long-winded post but this thread deals with an issue that is obviously very near and dear to me. Micheal Stumm, I know you are reading this thread so I am asking you to consider this type of protection for all of us. I love the trading experience here at Oanda and so much of what it stands for; for what it is to the forex trading community (the Forex Trader’s Bill of Rights is an awesome challenge to your competitors). The innovation and pioneering spirit…you have so much to be proud of as you move forward with plans for growth in the future. I do not want to leave but I would have no choice if the CIPF coverage (or something equivalent) is not forthcoming. Forgive me if that sounds like an ultimatum; it is not meant that way. It’s simply a situation where this experience with Refco leaves me feeling “Why would I trade somewhere that doesn’t offer me this protection when I can trade somewhere that does?”