Thank you for using Investment Navi+ up until now. This will be the final article.
There was an offer from someone associated with fx-on (GogoJangan), and for about a year I wrote articles on an investment information siteInvestment Navigator+covering investment topics, starting with FX.
However, the person has decided to retire, so our article-writing contract has ended.
Therefore, I decided to end my updates on Investment Navigator, which I had continued while on a business trip, and return to my original place of activity
Tell the Truth! ‘Former Financial Institution Employee's FX Blog’.
Thank you very much to everyone who has read fx-on articles so far.
If you don’t mind, I would be glad if you could follow me from now on atTell the Truth! ‘Former Financial Institution Employee's FX Blog’.
※ If there are offers similar to “1 yen per character with no retracking, purchasing articles,” I would gladly accept them.Note: I do not accept offers such as “You can receive a large payout by opening an account.”
【Lower FX margin ratios to around 10x, according to the Financial Services Agency】
According to Nihon Keizai Shimbun, the Financial Services Agency has begun considering reducing the margin requirements (leverage) for foreign exchange margin trading (FX). The leading proposal is to cut from the current maximum of 25x to around 10x. They have judged that when foreign exchange rates fluctuate sharply, individual investors and financial institutions face a higher risk of losses beyond expectations.
As you may know, this content was distributed a few days ago in Manepa (Money Partners) FX news.
I wonder if the senior officials at the FSA have really thought this through?
When leverage was reduced from 400x to 100x, I don’t think losses or risk of liquidation actually decreased.
Now that leverage restrictions are even tighter, what happens? The amount you can hold has decreased, but the time to stop-loss has lengthened, and when you are liquidated, you still end up losing a lot of money, don’t you?
Even reducing to 100x from 25x, there are still people who lose huge sums.
And for me personally, the fact that I haven’t suffered huge losses because of leverage regulations is not true at all.
Probably even at 10x, it won’t make much difference. People who incur large losses when rates move sharply against them will not decrease much.
If leverage is reduced to 10x, it will surely reduce forced liquidations, but if you hold many positions that move 5–10 yen against you, you will incur big losses regardless of leverage.
This may reduce the number of investors who are forcibly cut off, but it does not solve the problem of large realized losses turning into large unrealized losses.
“If leverage is reduced to 10x and it becomes unattractive, people will quit FX and buy Japanese stocks; then the stock prices will rise and the Japanese economy will recover!” Is that the plan?
Surely, people will flee to overseas FX again and start things like Bitcoin, leading to no real increase in Japan’s stock trading activity or stock prices...
In the past, executives tried to ban中古 (used) game software saying it was illegal.
Their argument was“The money flowing through the used game market is in the tens of millions or hundreds of millions. If that were to flow into purchasing new games, the game companies would prosper…”and calculating under a mischievous assumption.
It was obviously a rosy forecast, and I think the Financial Services Agency is in the same flower-power state of mind.
1. If leverage becomes 10x, transaction volume will purely decrease, so FX companies will not make money.
2. With fewer trades needed to make a profit, spreads widen. Positive swap rates drop significantly, and long-term investments lose their appeal.
3. If spreads widen, customers will leave; some brokers will try to maintain spreads, leading to scuffles with slippage and an unprecedented boom in stop hunting.
4. With dramatically increased required margin, we can no longer use arbitrage between brokers (using swap rate differences).
5. Pegged currencies like USD/HKD will rely on many trades with little profit, but you will be forced to reduce positions, which would be bad. The domestic USD/HKD available through YJFX would be completely undermined.
6. AUD/CAD historically have small rate variance and stable positive swaps. However, few brokers offer them, and those that do offer smaller swaps. … However, if you use low swap with selling CAD at a cheap rate and buying AUD at a higher rate via fixed high-yield brokers (like Hirose Trading/JFX), currency synthesis becomes quite attractive. … but this would also be unusable if margins rise sharply.
No matter how you look at it, reducing leverage to 10x would spell the decline of the FX industry. We must try to stop it.
【BRL/JPY (Brazilian Real) and Nikkei 225 mini status】
Unrealized losses are close to 130,000 yen, butthis year’s realized gains exceed 1,000,000 yen.
We incurred large losses due to the Real shock, but after offsetting, it’s a net gain of +1,000,000 yen.
However, the swap is still 34 yen, so the appeal as a high-interest currency is gone.
Nikkei 225 mini had as many as about 15 lots at its peak, but took profits at about 20,000 yen each, so now it’s just this much.
I plan to hold the remaining portion until Captain of the Shame Diary’s profit-taking time.
This year's realized gains exceed 1,800,000 yen.
There are times when doing various things yields significant profits.
fx-on (GogoJangan)’sInvestment Navigator+is probably the last time I will be writing there, but I will continue to invest, so let’s keep going together.
【The best cashback point sitePoint Income】
(Please replace this part when publishing to the purchaser)
