FXcast Forex broker gladly accepted my offer to give an interview for EarnForex readers. Niklas (member of FXcast IB Management) answered my questions about Forex trading, FXcast past and future plans and a present Forex brokerage market condition. A brief description of FXcast can found here.
For how long do you offer your on-line Forex trading services now? Does FXcast have any off-line brokerage experience prior to starting a site?
We offer online trading services with FXcast since over 2 years now. FXcast has worked as broker in a protected private environment. The website has gone public on the 1st of May 2007 after huge investments for automation and effectiveness of our website information and the procedures behind it. The goal is nearly 100% automated processes from account opening to withdrawals from trading accounts.
The founders of FXcast have each more than 15 years experience in brokerage, system development, customer relationship management, risk management, execution and whatever is important for our core business.
Why ‘FXcast’? Any particular reason for this name?
The name is a synonym for Forex Forecast – the only method in our opinion to trade successfully in the market. If it is a technical analysis based forecast or an economic based or a mixture of both – without a fundamental analysis and resulting forecast trading is only gambling. If a trader wants gambling – fine. If he wants profit he must stop gambling and start serious trading.
With so many other retail on-line Forex brokers, it takes some really distinctive advantages for a new broker to get into the market. What can you call FXcast’s main features to attract traders?
We see a lot of unique selling points, amongst others 36 currency pairs, tight spreads, fast and exact execution. But undoubtedly a major point is the easy-to-use account opening and funding – with small amounts done within 3 minutes or less. And we have a lot more facts which let us dominate the crowd: the transparency of the customer relationship management procedures as an example. Each single process is documented in the member’s area. Customers are able to see each single personal action – deposits, withdrawals, account management, personal data maintenance and more which gives them trust and believe in our reliability. All is traceable and documented and we can avoid the usual misunderstandings in email and phone call procedures. We are fast in our processes. We think the fastest FX broker worldwide. This is our goal: fast, reliable, accurate and transparent and absolutely concentrated on our core business: Our mission is to provide the opportunity for individuals and corporate customers around the world to trade currency markets under the most favourable conditions, such as enjoyed by financial institutes, banks, or brokerage companies. No marketing phrases – just forex brokerage business.
Another important fact is: FXcast is best choice for partners. For the above reasons partners can recommend FXcast with a real good feeling to their customers. And: FXcast has a unique affiliation model, a great chance for everyone to build up a 4 level partner model and become a prime partner of FXcast climbing up step by step within the IB levels. Every customer of a partner has a chance to hire other customers by becoming a partner himself.
And this promotion model is absolutely fair. We hear from the market that very often customers bypass their IBs to become an IB themselves with the Broker and the IB looses his customers. This is impossible with FXcast. Each partner gets the same commission when he starts – so why now bypass the IB? There is no advantage for anyone. Winning successful partners is a big plus for an IB – they promote him to the next level with their customers and everyone earns – a typical win win situation.
Of course we know that other Brokers pay more to their IBs in the beginning. But big commissions must be earned – of course from the customer. This short term thinking is not our style. For a stable and profitable relationship FXcast is the better choice – the commission model pays back very soon and the chances are tremendous.
The only precondition is a financial oriented website – not even any knowledge of the FX market.
Forex trading is not gambling, is it? What would you say to the people thinking that it is?
I am not quite sure that you are right. What should hinder a gambler to use our Swing platform? It is of course a platform to trade in the FX market. But we have developed it mainly for beginners and customers who want to “test” this market without real knowledge and experience. How it reacts, how charts are running and what the influence factors are for trading – news, overnight situations, sudden market movements and more. And we offer this for real low risk – starting with 1 USD! Of course there is a gambling factor included as you cannot get out of the trade until S/L or T/P is reached – like a roulette ball – rien ne va plus. Is the Forex market not much more interesting as a Casino?
But for the Pro trading terminal you are right! Successful trading needs time and money for education. But all successful paper trading means nothing when it comes to the point of trading real money. Real money is different – this is pure psychology. Therefore we offer customers with 10USD or 10 EUR the option to start their career with a low budget before they try to make real profit. Even a 0.01 lot real trade is different from paper trading – an excellent chance to get practice. You have to learn it with a low real risk but real money.
Does FXcast have a division which trades Forex, or do you only offer services to retail traders and prefer to stay off the market yourself?
Currently we only offer retail services for self traders.
Forex trading is becoming more and more accessible to people of all income sizes. How do you describe your potential customer? A rich person who seeks to increase his investments or a young and purposeful woman or man?
Our customers come from each group of society and wealth. There are traders with 1 USD and traders with 1 million USD accounts and higher. We see all trader types and all kinds of risks. Important is that everyone is a customer for us, independent from the deposit.
We are neutral and try to fill customer positions to the best possible price – if it is 0.01 lot or 1,000 lot.
You have a lot of interesting features on your site, like many deposit options and your Swing platform. Do you plan any new features?
We have many options in our portfolio. Some more internet payments methods are just in programming. And a lot of new features, which we will publish when ready. Our business is an online business, fast and reactive – so must our website. We have to go with a fast market and we will do it.
Our customers and the market will see some real exiting and fundamental news coming soon. We will inform you.
What do you think are the main obstacles for the new Forex traders finding a right Forex broker with whom they can cooperate on a long-term basis?
This is in our opinion the transparency of processes, the trade execution, the service and a fair price. The customer should have the feeling that he is treated as a partner – not as a victim. Of course you have to feel comfortable with the trading platform.
The information “regulated” does not automatically mean that this broker is a good broker. How effective is his regulation organization? Which influence does the regulation have on the broker’s behavior in trading situations? We think there is much scam on the internet as in every business.
Have a look on the broker’s website - your prime contact to the broker. Is all information useful or is it mostly marketing and gimmicks? How fast do you find the relevant information? Are all processes explained carefully? Are there hidden fees? How easy can you get more information from the broker? Are there special email addresses for each category of questions? Does he have a live chat during his office times? How responsive is the broker to your email questions? Is there an area which shows all your past processes and everything which you have done with this broker for absolute transparency and reliability? How fast is deposit and withdrawal? Do you feel comfortable with the trading platform(s)? Does it hang in critical situations? Are there gaps in the charts? Are you stopped out in some situations and should not be? You must have a deep look for example if the broker sends you trading signals. Are they really helpful? We think you should better use an external independent provider.
A lot of questions – and there are of course more to ask. But the main question is: do you feel comfortable with the broker’s behavior? There is a big misunderstanding in the market: that the spread is important for your trading. This is simply a rumor and professional traders know that it is a very big well known fundamental error. Professional traders often work with increased spread for covering their cost with rebates. Why do they make profit? Only some important facts decide if you win or loose: your knowledge and experience as a trader and the knowledge and experience of the broker. But in no case the spread. A fair spread guarantees the profit of the broker – which is important for your long term and stable cooperation with him. If your broker does not make profit you will loose too. And if the margin of the broker is too small he will try to get it back from you – the customer.
Public forums are often not really helpful – many frustrated specious “experts” are claiming about brokers which do not let them make profit. The real reason behind is often that simply the system does not work. The well known scalping machines which make a million in some days – they are only working on demo accounts. But of course to point to the broker is easier than developing a successful strategy. Professional traders do not have the time to discuss in forums. They have to trade.
Whom do you see as FXcast’s main competitor in the on-line Forex brokers market?
We don’t talk about competition. We think we are unique with our procedures and service. But of course other brokers may think that, too.
What do you think about Forex scam problem in the on-line Forex brokers market? Is it a real threat for the business or will customers learn to recognize the fraudulent sites, leaving them without a prey?
This seems to be a real problem as these cheating shops spoil a big part of the market. But if customers follow the words from question 3 they will soon sort the wheat from the chaff. We are not part of this – as our IBs published on our website will tell you. By the way – we only publish IBs working exclusively and successful for us – always the best in each country.
What is your insight on the future of the on-line Forex trading? What role will e-currencies play in this future?
We think the Forex market is a growing market. As shares and other derivates are complex and expensive and you can only be successful with big amounts it will definitely grow tremendously. On the other hand the number of FX brokers will decrease. There are so many small shops without experience, knowledge and financial background on the market that most of them will not survive. Traders become mature and will see soon which brokers really offer good and fair business. This is the reason why we see our future bright.
E-Currencies will become more and more important. After the E*Gold disaster the market moves again. But not as some governments and banks want the market to move. The world is going www – and so will payment methods. We are excellently prepared – our online payments options will grow. For small deposits the best and cheapest way to fund accounts. Nevertheless – for big accounts the wire transfer from a bank will be the most important way.
In both themes we see a tremendous future for FXcast. We are no old fashioned broker; we are modern and cooperative; we can handle unlimited numbers of customers with our high automated processes per day hour or minute. The only restriction is the internet and hardware – both can be scaled. We do not need huge staff – we are here to serve our customers in the background. Our philosophy is as different from the FX broker jam as it could be. We are prepared for the future market – what about your broker?
What would be your advice for new Forex traders who are just starting their experience on the Forex market?
Do not believe marketing and “best spread”. Good quality needs a fair price. Too low prices make quality decrease. From there on, it’s learning and investing much time, over day and night. Trading is a 24 hours job. And finding a fair, reliable and good partner – the best you can find. Maybe FXcast.
As you see, FXcast thoroughly answered all questions. And, although, some of the answer can look too “marketing” and to some people - debatable, it is still a very good sign that broker wishes to communicate with its existing or potential clients. If you have any comments on this interview or ideas for the future interviews you can leave a comment here, or via the contact form.
