FDAFX is a broker which supposedly provides forex trading. That being said, a lot of the company’s functionality, including opening new accounts was not available during our review.
The Company. Security of Funds
FDAFX was founded in 2010, in St. Vincent and Grenadines. Off-shore registration is typically a red flag for us, although there are some exceptions. Sadly this does not appear to be one of them, as the company is not registered under any regulatory agency. Trading with an unregulated company carries inherit counterparty risk i.e. they may be scammers.
As you may already know, the regulatory environment in which a company operates determines a lot about what it can or can not do. Well-respected regulatory agencies impose strict rules. Take the FCA for instance. A broker regulated under the UK’s watchdog has to keep client’s funds in the so called segregated accounts.This means, they are not freely accessible for company needs. Furthermore, all brokers must participate in the Financial Services Compensation Scheme (FSCS), which guarantees accounts in case the broker goes bankrupt. If you trade with a broker covered by this scheme and they happen to go under, your funds will be guaranteed up to GBP 50,000
It is needless to say you would not get these benefits, if you decide to trade with a non-regulated company.
Minimum Initial Deposit
FDAFX requires $200 as a minimum initial deposit. This is quite high in the current highly competitive market. Some brokers have very minimal requirements in order to attract curious people, who are not willing to risk much, as new clients. One such broker is XM, which only demands a $5 deposit for a new account.
Do not forget, a more substantial investment is required in order to execute a long-term profitable system. The initial deposit requirement should not be a chief concern of a serious trader.
Average spreads & Commissions
Sadly, there is no information regarding the spreads on FDAFX’s website. This is rarely the case, as most brokers display their conditions on a clearly visible part of their site, even if they are worse than competitors, just to give potential clients the feeling of openness. We tried testing this broker’s services, but at the time of writing of this review, we couldn’t register a new account. Hopefully this is just a temporary technical glitch, which will be resolved in the future. In the meantime you can look into our real-time comparison of spreads offered by some of the top-rated forex brokers.
This broker offers leverage ratio up to 1:500. This level is quite substantial, but nor that unusual in the contemporary environment. A reasonable trading strategy should not require such outrageous gearing.
We must note, higher leverage is a double-edged sword. It can increase the impact of your trading losses, the same ways it does with your winning trades. Newer traders frequently misuse leverage to their detriment. This is one of the reasons why US regulators don’t allow forex brokers to offer more than 1:50 leverage to retail customers.
FDAFX offers trading services via the MetaTrader 4 (MT4) platform. It is the world leader, when it comes to forex trading platforms. With solid charting capabilities and an abundance of custom technical indicators and automated trading systems available, the platform has earned many fans. Furthermore, the mobile version feels very responsive, when compared to other solutions.
The only major downside of the desktop platform is the lack of detachable modules, which limits the capability to create a multiple screen set-up.
Methods of Payment
FDAFX allegedly offers lots of payment methods. Given the situation with our inability to open a new account, we can not be certain if they work at all. The deposit options include: Bank Transfer, Credit/Debit Card, Western Union, China Union Pay and PayPal.
FDAFX Review Conclusion
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