Finexo Review

I had heard some really good things about Saxo Bank and had been looking at opening an account when i came across Finexo. Finexo is a white-label partner of Saxo, and as such I didn't really expect to get anything from them that I couldn't already get at Saxo. To my surprise though, I found that Finexo offers up tighter spreads on EUR/USD (because they give up a bit of their commission, as I found out later). They offer a few other advantages over Saxo, most of which translate into better trading conditions for many retail traders. For those of you who have traded Saxo, you know that there is a learning curve to the platform. It is powerful, but difficult - with great power come great headaches. Finexo gives you a much easier-to-use platform, and it's browser based so even you Mac guys out there can play. The downside is that it doesn't offer all the reliability of SaxoTrader.

Along with all that they also accept more payment methods for those of you who use PayPal instead of a private bank in the Cayman Islands. I found the trading conditions to be quite good since they tap Saxo's liquidity. Overall, it feels like a small brokerage but with the backing of a large institution when it comes to liquidity and financial stability.

NOTE: Although I had some doubts in my mind about their connection to the British Virgin Islands, the fact that they are backed by a well-known broker alleviated most of my concerns. My hunch was correct, and all my deposits and withdrawals went without a hitch.

PROS:
Wide variety of deposit/withdrawal methods;
Decent spreads;
Scalping is allowed;
Easy to use platform;
Mac-compatible platform;
Deep liquidity (Goldman Sachs, Dresdner Kleinwort Wasserstein, Deutsche Bank, Marex Financial);
and UBS.;
Orders are processed through an automated dealing desk according to the "Best Execution Policy";
Server-side trailing stops;
OCO and if/then orders available;

CONS:
Platform reliability is questionable;
No automated trading;
Registered in the British Virgin Islands - a bit shady;
No Islamic swap-free accounts;
No oil, gold, or exotic currencies;

Quick Facts:
Finexo is a white-label partner for Saxo Bank;
Registered in British Virgin Islands and Germany;
Regulated by BaFin (Germany) with ID 108861;
In business since 2003;

For more detailed information, you can visit this Finexo Review, or visit their website here.

Oanda Review

As one of the most respected retail forex brokers out there, Oanda is certainly worth a look for most serious traders. While trading short-term with Oanda, I found that the execution was excellent during all market conditions. Having said that, however, Oanda does seem to "massage" their spreads into getting wider than most during news times. I am not particularly fond of news trading however, so this is not a big deal for me. I would not recommend Oanda to any news traders out there though. Short-term trading is also hindered by the fact that many intraday moves tend to be technical in nature, and technical analysis is made difficult by Oanda's poor charting capabilities. An external charting package is highly recommended.

Swing trading is what this broker was made for. By paying hourly swap instead of daily, and by giving smaller account holders the flexibility of trading single units, there is really not much more a swing trader could ask for. I would still recommend some external charts, but most professional traders would opt for that anyway, no matter who their broker is.

The platform itself has its ups and downs, with reliability being the main complaint. It can crash at times and become disconnected from the server more often than some more robust platforms. On the upside, it runs in your browser so it is completely Mac-compatible. Very detailed reporting is also available. Traders can easily calculate their exposure to each currency in their portfolio, for example.

PROS:
Single unit trade sizes allow for flexible position sizing and precise money management;
Browser-based platform works on any operating system;
Low spreads during normal market conditions;
Pays interest on account balance;
Server-side trailing stops;
Hourly swap payout;
Well capitalized;
NFA regulated;

CONS:
Poor charting;
Not many pairs to trade;
Very wide spreads at news times;
Questionable platform stability;

Quick Facts:
Headquarters in Toronto, Canada;
NFA member since 2003 (ID 0325821);
Over $170 million in capital as reported to the CFTC;
Target spread on EUR/USD 0.9 pips (0.00009);
Server-side trailing stops allow for them to be honored even when platform is closed;
50:1 maximum leverage (in most cases, this is not a bad thing);

For more information, please visit this full Oanda review.

eToro Review

In my last post I talked about shorting the carry trade with a swap-free broker to avoid paying the overnight swap. I was unwilling and unable to open a large account at any single dodgy broker, so I chose to spread my risk over several. The second swap-free broker I chose was eToro, located in yet another offshore location (Cyprus). They have a US-based arm called eToro USA which is regulated by the NFA, but eToro proper is only regulated by its Cyprian counterpart CySEC - again, not exactly confidence inspiring. This outfit was started up by an Israeli group coming over from the gambling industry (the business model is remarkably similar), and it is quite obvious: the trading platform looks and feels like a game. When I first opened it up I thought it was a joke. They have a "visual mode", and no words can do it justice - you have to see it for yourself - if you buy say USD/JPY, you will see a fat cowboy racing a sumo wrestler down a track. While certainly amusing, any serious trader will shudder at the mere thought of turning the serious business of trading into a game. In all fairness however, these guys are serious about their business, just like they were in the gambling industry, and they do also offer an "expert mode" without the gimmicks. They are in it for the long haul, which is always a good sign that differentiates a legitimate business from the cut-and-run scammers that are running rampant in the industry.

PROS:
Chat feature right in the platform so you can interact with other traders and customer support;
Excellent customer support available for chat even on weekends (for real account holders);
Wide range of transaction methods (listed below under "Quick Facts");
Fixed spreads;
Multi-language platform;
Some great promotions, such as $500 free when you deposit $1,000+;
Segregated accounts;

CONS:
Relatively high spreads;
Mediocre execution;
Weak platform that relies more on gimmicks than functionality or reliability.
Trade sizes are in 10,000 units, not leaving many money management options to smaller accounts, which they specifically target. This is a predatory practice;

Quick Facts:
Headquarters in Cyprus, regulated by CySEC
In business since 2004
Client accounts segrated from operating capital and held at Marfin Popular Bank, Cyprus
US-based clients should visit eToro USA (NFA regulated)
Payments: Credit Card, Moneygram, NETeller, PayPal, Western Union and Wire Transfer
Maximum 400:1 leverage

You can visit eToro here, or get more information here. Thanks for stopping by.