Jul 5 2009, 02:44 PM
QUOTE(rstusa @ Jul 3 2009, 10:45 AM)
For the new FIFO rule created by NFA, it had made some changes to our trading, actually is good for us to prevent losses or margin call. Here the changes that affected:-
1) If apply FIFO: You need to close the 1st trade before you can close the 2nd trade, but you still can open the same lot size for the same pair. Only can create S/L & T/P for the 1st trade.
2) If without FIFO: You can't open the same lot size for the same pair and you need to open different lot size for them, Eg: 1.00 lot for 1st pair and 1.01 lot for 2nd pair.
Do you want to know why the NFA is enforcing this rule?
It's supposed to be a protective rule to prevent you from incurring major losses on a set of losing trades. If you didn't close the first opened first hoping the market would retrace to either minimize your losses or potentially achieve a small profit, the NFA feels that too often the market does not retrace to just compound your losses further until you hit margin calls. I think the NFA created the exception for different lot sizes to rule more with a velvet glove than an iron fist because it gives traders some flexibility and keeps a balance between protective vs. controlling for the new rule.
For more info, please visit http://www.nfa.futures.org/news/newsNotice...?ArticleID=2273
Thanks..1) If apply FIFO: You need to close the 1st trade before you can close the 2nd trade, but you still can open the same lot size for the same pair. Only can create S/L & T/P for the 1st trade.
2) If without FIFO: You can't open the same lot size for the same pair and you need to open different lot size for them, Eg: 1.00 lot for 1st pair and 1.01 lot for 2nd pair.
Do you want to know why the NFA is enforcing this rule?
It's supposed to be a protective rule to prevent you from incurring major losses on a set of losing trades. If you didn't close the first opened first hoping the market would retrace to either minimize your losses or potentially achieve a small profit, the NFA feels that too often the market does not retrace to just compound your losses further until you hit margin calls. I think the NFA created the exception for different lot sizes to rule more with a velvet glove than an iron fist because it gives traders some flexibility and keeps a balance between protective vs. controlling for the new rule.
For more info, please visit http://www.nfa.futures.org/news/newsNotice...?ArticleID=2273
QUOTE(AdamG1981 @ Jul 3 2009, 01:01 PM)
Is that you in the avatar displayed?
frankly, I'm not the person. QUOTE(MNet @ Jul 3 2009, 03:44 PM)
After do some DD, this is not the person.
wat's DD? yes, you are right, I'm not her.
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