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FXCM Review

Published by Usman Ahmed, MBA (Researcher)

Reviewed by Bowen Khong, ACCA

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. This content is intended for information and educational purposes only and should not be considered investment advice or investment recommendation.

With multiple regulations across various geographical regions, FXCM is one of the oldest and most reputed brokers, offering retail trading services in forex, indices, shares, and cryptocurrencies. The broker is well known for its low-cost pricing models, intuitive trading platforms, and round the clock customer support.

In this FXCM review, I’ll try to cover each and every aspect of the broker in detail. So let’s get started.

Overview

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Founded in 1999, FXCM is an online brokerage firm providing trading services to both retail and institutional investors around the world. Transforming from Shalish Capital Markets, the company changed its trade name to FXCM after one year of its inception. 

FXCM had been through many transitions before it became a sensation in the forex trading industry. The broker started its journey back in 2003 when FXCM entered into a partnership with the U.S. Futures trading giant, the Refco Group. Following the conviction of the Refco Group’s CEO (Phillip R. Bennett) for committing $430 million fraud (2005), and subsequent breach of the agreement for selling Refco’s 35% stake back to FXCM for $110 million by the group’s creditors, FXCM ended up selling the Refco’s share in the company to Lehman Brothers Holdings in 2006.

After taking over the UK-based ODL Group in 2010, FXCM became one of the largest retail brokers with more than 200,000 clients and a market worth exceeding 800 Million US Dollars approx. 

In 2017, Jefferies Financial Group took over the company amid the financial crisis arising after the Swiss National Bank (SNB) removed the Swiss Franc peg. The Jefferies Financial Group (Ex Leucadia National Corp) continues to own dominance in the business ventures of FXCM to date. Jefferies Financial Group Inc. is a multinational American company listed on the New York Stock Exchange (NYSE) since 1965.

Headquartered in the United Kingdom, FXCM operates through its ten (10) regional offices across the five continents. Besides being regulated in some of the major economic hubs, including Australia, South Africa, the United Kingdom, the broker also serves some countries of the European Zone. As of 2018, FXCM was the second-largest retail broker in the forex trading industry. 

ProsCons
Multiple regulations
Supports social trading
Offers flagship custom built trading platform
EAs are allowed
Offers a limited product portfolio
High withdrawal fees
Lacks two-step authentication
Average customer support

Who is FXCM for? 

With instant trade execution models and a user-friendly trading interface, FXCM supports multiple trading styles. Focusing on low-skilled clients, the broker offers a variety of educational resources and virtually funded demo accounts, helping traders to master the trading odds without any risk. 

Low trading costs, flavored with minimum margins, and adequate leverage allow high volume traders to optimize their profits. Algo-trading with the provision of APIs integration and multiple social trading platforms make the broker a perfect trading solution for both retail and institutional clients. 

Sign up bonus: Region restricted welcome bonus of up to $20 is available at FXCM.

Is FXCM Safe? 

Trust Score: 85 (read more)

FXCM is fully authorized and regulated by the Financial Conduct Authority – FCA in the United Kingdom. In compliance with the FCA regulations, the broker needs to maintain enough capital to avoid liquidation in any financial crisis. Also, the broker is required to hold clients’ funds in absolute segregation from the company’s capital investment, preferably with AAA rating banks. 

Being a registered member of the Financial Service Compensation scheme, FXCM also offers insurance against the financial loss of up to 50,000 GBP. Other than FCA, the broker also holds licenses from the world’s most reputable regulatory authorities, including ASIC, IIROC, AMF, and FSCA. 

Year founded:1999
Publicly traded: No
Licenses: FCA, ASIC, IIROC, AMF, and FSCA
Backlist: 

Offering of Investments 

Owing to jurisdictional regulatory restrictions, the range of products offered by FXCM may vary. Allowing access to exchange-traded securities across Canada, Eurozone, and some Asia Pacific regions, the broker facilitates forex and CFD trading in multiple financial instruments. 

Tradeable products offered by FXCM are limited as compared to its competitors. However, the broker is still in the process of adding more tradable assets to provide clients with flexible asset selection. 

Forex: Spot TradingYes
Currency Pairs (Total Forex pairs)39
Social Trading / Copy-TradingYes (ZuluTrade)
CFDs instruments82

Commissions & Fees 

As far as the pricing structure of the FXCM is concerned, the broker employs slightly higher pricing slabs. With an average spread of 1.4 pips on EURUSD, FXCM prices tend to fall on the higher edge when compared with the industry standards. Provisioning price discounts, the broker also hosts a cash rebate program in various tiers. Tier 01 clients with a traded volume of 01 Million U.S Dollars can claim a cash rebate of up to $5. Similarly, for tier 05 customers, a $25 cash rebate is available on trading volume worth 01 Million USD. 

In commission-based accounts, FXCM charges a spread of 0.2 pips on EURUSD along with 0.9 pips commission charged on a single traded mini lot. FXCM also holds an active trader program with different tier levels that vary from country to country. Clients can enjoy reduced commissions based on their traded volumes. 

The minimum deposit amount is $50 to get started with the broker. The company does not charge any fee on deposits. Withdrawals through debit cards or credit cards are also free of cost. However, customers requesting funds withdrawals via wire transfers might need to pay $40 as an administrative fee. 

Minimum Initial Deposit$50
Average Spread EUR/USD – Standard1.4
All-in Cost EUR/USD – Active1.1
Minimum withdrawal No Limit

Platforms & Tools 

With user-friendly, intuitive trading platforms, FXCM ensures that its clients enjoy a seamless market exposure. Through the proprietary web-based trading station, the broker offers downloadable indicators and custom layouts, allowing traders to customize their trading preferences. With robust charts and exploring through powerful trading tools, including real price quotes, trader sentiment, and traded volume updates, FXCM takes clients’ trading experience to the next level.

The availability of the desktop trading platform enables traders to trade with the industry’s most powerful trading platforms. With no third party bridges, FXCM allows traders to employ their preferred trading strategies, including scalping. Clients can also enjoy access to free virtual private servers together with the usage of expert advisors. 

Using social trading platform ZuluTrade, traders can discover P2P auto trading. With an option to copy trading activities of the world’s most expert professional traders, clients can start making profits right away without having to go through detailed market analytics. FXCM leverages two types of copy trading services through its social trading platform. Clients can either choose to pay a share for their profitable trades only or can subscribe to the managed portfolio service. 

Virtual Trading (Demo)Yes
Proprietary PlatformYes
Desktop Platform (Windows)Yes
Web PlatformYes
MetaTrader 4 (MT4)Yes
MetaTrader 5 (MT5)No
Charting – Indicators / Studies (Total)51
Charting – Drawing Tools (Total)31
Charting – Trade From ChartYes
Order Type – Trailing StopYes

Research  

FXCM has a decent amount of research tools available on its website. The broker offers a mix of in-house and third-party featured content. The economic calendar keeps traders well informed of upcoming economic events. Market news from investing.com and FXStreet also provide an insight into the latest industry developments. 

The availability of charting tools helps traders to identify price movement trends as well as evaluating the appropriate entry or exit points. Using the market scanner, traders can scan the forex and CFD markets and receive 05 best trading signals daily. The trade volatility section can also help clients to know the pairs with significant price movements. 

Rating: 4/5

Education  

The FXCM education section is also full of informational content. Educating clients from the grass-root level, the broker gradually brings learners to advanced content where it teaches traits of successful traders along with a comprehensive guide on how to do technical analysis. The wide range of video tutorials covers topics on almost every domain of forex trading. 

Free online courses through live classrooms with the industry’s top professionals five days a week is an exceptional service. Traders can also access the recorded webinars any time in case they fail to grab the live sessions. Clients can also subscribe to the Free SMS alert services offered by the FXCM to receive updates on geopolitical events and other macro factors on a run-time basis. 

Mobile Trading 

Considering the need for mobility, FXCM offers its flagship proprietary trading platform for all Mac and Android supported mobile phones and tablets. Traders can visit the APP Store or Google Play Store to find and download the supported versions of the  FXCM trading platforms. 

On-the-go users can enjoy seamless functionality of the custom built mobile trading app powered with both innovation and ease of use. The app provides access to markets from the comfort of your palm, enabling you to incorporate trading indicators, execute orders, and receive real-time price quotations. Advanced charting options lets you enter positions directly from the charts.

Mobile devices Apple & Android
FeaturesTrade placement, charting options, watchlist, real-time price quotations

Final Thoughts 

After an in-depth review of the broker, I can safely conclude that FXCM is one of the best options for traders looking for high-scale trading opportunities coupled with moderate pricing structures. Low margin requirements and minimal negative slippage might attract scalpers to make the best use of it. Offering a safe trading environment, decent spreads, and increased transparency, FXCM can be a competitive option for both newbies and professional traders. 

Usman Ahmed, MBA (Researcher)
Usman Ahmed, MBA (Researcher)
Usman Ahmed is a currency trader and financial market analyst with more than 7 years of active trading experience. Besides holding a Masters degree in Business Administration, he has worked for some of the most renewed companies in the forex industry including FXCM, IQOption, MetaQuotes, Alpari, FXStreet, DailyFX and several others. Usman possesses strong technical analytical skills and is famous for his very own, informative and entertaining, writing style. He believes in naked chart trading analysis that is commonly known as price action trading. He follows global financial news and macro-economic events very closely.
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