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Trading: Primarily Energy but also a little Equities, Fixed Income, Metals, U308 and Crypto.
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ES Contract
Notional Value :- $223,050
Margin Requirement :- $12,320
Intra Day Margin :- $1500/$2000/$2500????
So if your trading 1 contract, what's your account size? What about if your trading 12-14?
Typically companies only get investigated when they screw customers/investors over and those customers/investors file regulatory complaints. If they were paying everyone out, then no one would complain. OR, their competitors (and there are many similar "forex funded firms") went after them for getting too big, too fast, and eating into the industries revenue ($300 million fees in 2 years sounds like insane growth).
I'm not familiar with MyForexFunds, but there's countless youtube videos with affiliate links and getting funded journeys. Perhaps their rules were too easy so that gave them the massive boost in acquiring customers from other funding firms. Then they though that they could just not payout, and then ultimately led to their downfall.
I read somewhere that the industry eval pass rate is 3%. I wonder what MyForexFunds was.
Just last week, I had some Forex brokerage offer me $1K per referral, and they claim it would be EASY for me to make what other affiliates are making - $60-100K PER MONTH in affiliate fees (or so they claim).
Also reading the complaints, it sounds like MyForexFunds was doing other things besides only prop firm activities like TopStep, Earn2Trade, Apex, etc.
"The CFTC also alleged that My Forex Funds had defrauded investors by misappropriating their funds and engaging in unauthorized trading."
"The company misappropriated funds from investors. MFF used investor funds to pay for personal expenses, such as luxury cars and real estate."
"The company engaged in unauthorized trading. MFF traded on behalf of investors without their knowledge or consent."
That's really what did them in, messing with investor funds. They probably marketed and offered "managed" accounts where their bots make money for you.
It sounds similar to the Traders Domain forex ponzi, except Traders Domain was only the ponzi whereas MyForexFunds had the "funded accounts" + separate Ponzi.
Funny that both MyForexFunds and Traders Domain started in Mid 2020, both reached similar sizes, and both busted by the CFTC around the same time.
Moral of the story is don't run a ponzi. I don't think the CFTC cares about funded trader prop firms as long as there's no investor money involved.
Indeed - the position-sizes that many/most of these funding companies allow their triallists to use give you palpitations, just looking at them.
Even at Topstep, if you try what they call the "$150k Combine" with its trailing maximum drawdown of $4,500 (calculated end-of-day, not on open equity), they allow you to trade 15 lots of ES: just one 15-lot trade that moves 6 points against you, and that's your account blown. I'm not suggesting that most of their customers would actually open a 15-lot ES position, of course, but it does rather make you wonder why they allow it, whether they want people to pass or fail, and so on.
Don't compare numbers in signups of forex funding firms to futures funding firms. Their target audience size is likely very different from each other.
Also, for some weird reasons, new comers are easily attracted to forex, at least in my know circle. Could be wrong if anyone actually does any survey.
I'm more concerned about common issues like "firms not actually sending orders to exchange and settling off exchange" etc. That in itself tells it was a fraud to begin with and till day one of the biggest fears of funding firms (be it forex or futures).