Sunday, April 14, 2013

Oanda Review


Today we will take a look at Oanda, a much talked about forex broker over at one of the most active forex forums for new trades; BabyPips. You will see this broker mentioned by just about every active member and Oanda does have their ads plastered across the board which makes you think twice about a few more active members who tend to push new and undecided traders the Oanda way.

While we do not want to say anything negative about the huge Oanda followers and how they casually mention them as the best broker every second chance they get, we decided to give them a closer look in a slightly different way as we have reviewed forex brokers before.

Since The Last Bear is a very optimistic outlet, we will start with what really like about this forex broker. They have been founded back in 1995 and started to offer forex trading to clients in 2001 which means they have stood the test of time. Oanda offers over 90 currency pairs as well as precious metals which is another positive for the company.

One of the biggest positives is that there have been no listed lawsuits as well as violations against Oanda, unlike FCXM. It does appear that Oanda does try to be very transparent and treat their forex traders fair and we respect that here at The Last Bear.

They also have their own trading platform which is an additional bonus. Their website is designed professionally, but the information provided did not satisfy us. There have been plenty of unanswered questions and Oanda tries to push you towards an account opening to find out more. We spend some time trying to find the answer or a FAQ section without success and did not bother to waste more time. A broker of this magnitude should be better presented. Live support may have helped, but we did not go down that road.

The number one reason we do not like this forex broker; no the reason we hate Oanda:

They are regulated in the U.S.! They subscribe to economic socialism and the Nazi regime of the CFTC.

While so many forex traders insist on a regulated broker, it is not always the best solution and in the case of Oanda it actually harms then thanks to the regulatory stupidity, and utter ignorance of the U.S. regulatory system. While plenty will throw out to newbies that the U.S. is the best and safest country to do business with, they seem to be stuck in the 70’s.

When you hear CFTC, pack your bags and move away!

The Last Bear understands that many voices will say that the CFTC rules and regulations do not impact novice traders, and are only designed to take the competitive advantage away from U.S. based professional traders and make sure they become the laughing stock of the global professional arena, The Last Bear advises to pick a forex broker which will never limit your ability to operate.

It is very important to build a long lasting relationship with your broker, assuming you are serious about forex trading, so why would you pick a forex broker who is bound by utmost retardation which will hinder you to operate freely? 

You would not and you should not. Having said that most traders will fail at forex trading and they may disregard Oanda’s handicap. The Last Bear recommends all serious forex traders to stay far away from the CFTC.

One thing about regulation most traders ignore is that your money is not safe or safer than with an unregulated broker. Regulation will hinder your activities, but not necessarily protect you. MF Global as well as PFG Best are prime examples of how the U.S. regulatory system did not protect clients so please do not be as idiotic as to assume that just because your forex broker is regulated you are safe.

Conclusion

Oanda does offer several attractive features and we would almost recommend them, but they have messed up completely as they are under the reign of the CFTC and our recommendation is for every serious trader who has at least two function brain cells left which attempt to communicate with each other in order to create an intelligent thought to stay as far away from Oanda as possible. Two claws down, The Last Bear has roared.

5 comments:

It seems that Oanda is being sued by its former CEO Tim Kelly!
Found this information doing a routine search...Only recently and
cannot confirm it, but wouldn't be surprised. Should be in the public record somewhere.

I would not be surprised about it. Oanda is not half the broker they advertise to be.

Are you really advising people to open accounts with unregulated brokers??? Yes, sure there have been failures under CFTC watch, but what about the countless schemes that bucket shops run and how many failures of unregulated brokers there are?? I can see your point, but it is weak and dangerous to advise newer traders to go with an unregulated broker. And just because it might matter, in Canada Oanda is covered under CIPF.

Better advice than to go with an unregulated broker is to search and do your due diligence. Please do not look at regulation in this industry as a bad thing, as it is at least some form of "watch" over a brokers dealings.

Don't believe that it's a good thing, at least in some light? Well how about the CFTC has made it mandatory for even sales people in OTC FX to become licensed through FINRA. This makes the guy selling you a trading solution at least knowledgeable about ethics and regulatory requirements, and markets and trading in general, and also accountable. You don't get that without regulation.

Now I am not totally a fan of regulation, but the fact remains that in this business there are scammers out there, that will rip you off. just keep your eyes open, and don't be stupid with where you put your money!

Good Luck!

I am advising people to not take regulation as a guarantee that the broker is solid. FXCM, PFG Best and MF Global are three high profile cases. Oanda is not half the broker they claim to be and their spreads are terrible. US regulation is as bad as it can get for a trader.

I agree that there are plenty of scammers, but regulation is not the solution. I do like the regulatory body in the UK so if you seek a regulated broker you should at least stay out of the US.

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