Ayondo's revelations that more than 70 percent of its loss-making clients lose less than £100 raises questions about ESMA rules
Ponder on this Finance Magnates readers: sometimes when people trade with contracts-for-differences brokers, they lose money. Amazing, I know, but just how many people lose money?
According to Finance Magnates’ very own research, the average broker will see its clients lose money 76 percent of the time. In an age in which the unfastidious love to take a statistical disparity, not look into any of nuances involved and then draw an extremely simplistic conclusion, that’s not a good look.
But before we break out the tiki torches and start burning brokers’ offices down, let’s try to examine the statement a bit more closely. If we allow for any level of loss-making to count as a loss, then there is certain to be a wide divergence in how much people have lost.
Amongst our 76 percent of losing traders, there could be a huge number of people that lost one dollar and a small number that lost over ten thousand. Is it entirely reasonable for those people to be classed together? Methinks not.
None of this would be problematic but for the European Securities and Markets Authority’s latest regulation. Bane of every broker’s existence, these rules require that firms explicitly state how many of their traders lose money with them.
That leaves brokers with the problem we just looked at. They are forced to give a percentage that doesn’t capture the intricacies of a client’s life-cycle, trading activity or - most importantly - losses.
Thankfully, one broker has come up with a simple, yet effective, way of righting this wrong. Just below its requisite loss-making figures, Ayondo, a German broker, has written the following:
“70.1% of those clients that lost money lost less than GBP100 (or currency equivalent).”
Whoa! That changes things a bit.
Now, let’s lack all nuance and say that ALL of those people lost £100. For the average person in the UK, this would mean, in a 12-month period, losing less than one day’s wage.
Ayondo’s numbers also show that 50 percent of all its traders lose £100 or less in a given year. Exactly how much the remaining loss-making clients lose is unclear, and Ayondo probably isn’t going to tell us anytime soon.
Nonetheless, for the statistically challenged victim-creators, those numbers probably make for painful reading. When the person you want to protect is losing less than a day’s wage over the course of a year, it’s harder to argue that they require the cuddly embrace of regulatory prophylactics.
Could such numbers be used to appease the gods of ESMA and bring brokers back into their good books? To quote the Magic 8 Ball from Toy Story - “don’t count on it.”
Ponder on this Finance Magnates readers: sometimes when people trade with contracts-for-differences brokers, they lose money. Amazing, I know, but just how many people lose money?
According to Finance Magnates’ very own research, the average broker will see its clients lose money 76 percent of the time. In an age in which the unfastidious love to take a statistical disparity, not look into any of nuances involved and then draw an extremely simplistic conclusion, that’s not a good look.
But before we break out the tiki torches and start burning brokers’ offices down, let’s try to examine the statement a bit more closely. If we allow for any level of loss-making to count as a loss, then there is certain to be a wide divergence in how much people have lost.
Amongst our 76 percent of losing traders, there could be a huge number of people that lost one dollar and a small number that lost over ten thousand. Is it entirely reasonable for those people to be classed together? Methinks not.
None of this would be problematic but for the European Securities and Markets Authority’s latest regulation. Bane of every broker’s existence, these rules require that firms explicitly state how many of their traders lose money with them.
That leaves brokers with the problem we just looked at. They are forced to give a percentage that doesn’t capture the intricacies of a client’s life-cycle, trading activity or - most importantly - losses.
Thankfully, one broker has come up with a simple, yet effective, way of righting this wrong. Just below its requisite loss-making figures, Ayondo, a German broker, has written the following:
“70.1% of those clients that lost money lost less than GBP100 (or currency equivalent).”
Whoa! That changes things a bit.
Now, let’s lack all nuance and say that ALL of those people lost £100. For the average person in the UK, this would mean, in a 12-month period, losing less than one day’s wage.
Ayondo’s numbers also show that 50 percent of all its traders lose £100 or less in a given year. Exactly how much the remaining loss-making clients lose is unclear, and Ayondo probably isn’t going to tell us anytime soon.
Nonetheless, for the statistically challenged victim-creators, those numbers probably make for painful reading. When the person you want to protect is losing less than a day’s wage over the course of a year, it’s harder to argue that they require the cuddly embrace of regulatory prophylactics.
Could such numbers be used to appease the gods of ESMA and bring brokers back into their good books? To quote the Magic 8 Ball from Toy Story - “don’t count on it.”
Gender Gap in Online Privacy Concerns: Women More Reserved in Sharing Personal Data
Network, Learn, Grow | FMAS:24
Network, Learn, Grow | FMAS:24
Get ready to mark your calendars for FMAS:24, returning this May! Take a quick glimpse of what awaits at the Sandton Convention Centre in Sandton, South Africa from May 20-22, 2024.
Don't miss out on this 5-second invite packed with energy and urgency!
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#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
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Get ready to mark your calendars for FMAS:24, returning this May! Take a quick glimpse of what awaits at the Sandton Convention Centre in Sandton, South Africa from May 20-22, 2024.
Don't miss out on this 5-second invite packed with energy and urgency!
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
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Here's a sneak peek into the FMAS:24 vibrant atmosphere! Join us at Africa’s premium financial event for a transformative experience that combines the best of finance and technology.
From May 20-22, 2024, the Sandton Convention Centre in Sandton, South Africa, will be the hub for over 3,500 attendees to engage in unparalleled networking opportunities, learn from over 150 industry-leading speakers, and explore innovations from 120+ exhibitors.
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
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Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Here's a sneak peek into the FMAS:24 vibrant atmosphere! Join us at Africa’s premium financial event for a transformative experience that combines the best of finance and technology.
From May 20-22, 2024, the Sandton Convention Centre in Sandton, South Africa, will be the hub for over 3,500 attendees to engage in unparalleled networking opportunities, learn from over 150 industry-leading speakers, and explore innovations from 120+ exhibitors.
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
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Join 3500+ Attendees at FMAS:24 | Africa's Premium Financial Event
Join 3500+ Attendees at FMAS:24 | Africa's Premium Financial Event
Looking to expand your network in #Africa? Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
📣 Stay updated with the latest in finance and trading!
Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
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Looking to expand your network in #Africa? Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
📣 Stay updated with the latest in finance and trading!
Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
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Join 3500+ Attendees at FMAS:24 - Africa's Premium Financial Event
Join 3500+ Attendees at FMAS:24 - Africa's Premium Financial Event
Looking to expand your network in #Africa?
Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
Looking to expand your network in #Africa?
Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
Where the Prop Trading Industry Goes from Here | Finance Magnates Podcast
Where the Prop Trading Industry Goes from Here | Finance Magnates Podcast
Explore the tumultuous world of prop trading in this Finance Magnates podcast episode, featuring insights from Head of Axi Select, Greg Rubin.
We're discussing the challenges and shifts caused by MetaQuotes' pivotal decisions affecting MT4 and MT5 users, and how Axi Select offers a unique, realistic path to professional trading, steering clear of traditional prop firm pitfalls.
Tune in for expert analysis on the future of trading and innovative funding models.
The Axi Select programme is only available to clients of AxiTrader Limited. CFDs carry a high risk of investment loss. In our dealings with you, we will act as a principal counterparty to all of your positions. This content is not available for AU, NZ, EU and UK residents. For more information, refer to our Terms of Service. Standard trading fees apply.
This content is provided solely for general informational purposes and should not be construed as financial product advice or an investment recommendation. It has been prepared without considering your personal circumstances.
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Explore the tumultuous world of prop trading in this Finance Magnates podcast episode, featuring insights from Head of Axi Select, Greg Rubin.
We're discussing the challenges and shifts caused by MetaQuotes' pivotal decisions affecting MT4 and MT5 users, and how Axi Select offers a unique, realistic path to professional trading, steering clear of traditional prop firm pitfalls.
Tune in for expert analysis on the future of trading and innovative funding models.
The Axi Select programme is only available to clients of AxiTrader Limited. CFDs carry a high risk of investment loss. In our dealings with you, we will act as a principal counterparty to all of your positions. This content is not available for AU, NZ, EU and UK residents. For more information, refer to our Terms of Service. Standard trading fees apply.
This content is provided solely for general informational purposes and should not be construed as financial product advice or an investment recommendation. It has been prepared without considering your personal circumstances.
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Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
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