Disclaimer and Privacy
Clients should read the account opening documentation, disclosure documents and trading regulations carefully so that they fully understand limitations to the policies regarding executions of stops and no deficit accounts.
Any opinions, news, research, analyses, prices, or other information contained on this website are provided as general market commentary, and do not constitute investment advice. CompassFX is not liable for any loss or damage, including without limitation, any loss of profit, which may arise directly or indirectly from use of or reliance on such information. CompassFX has taken reasonable measures to ensure the accuracy of the information on the website. The content on this website is subject to change at any time without notice.
Trading foreign currencies in the off-exchange spot Forex market is a highly risky form of investing. It is not suitable for all investors. Before trading in the Forex market, you should carefully consider investment objectives, level of experience and risk tolerance. It is important to only invest money you can afford to lose.
There is a high degree of risk in trading off-exchange foreign currencies. Any market transaction involving currencies contains risks including, but not limited to, the potential for random political events and economic conditions that may significantly affect the market price or liquidity of a currency.
Furthermore, the use of high leverage in trading margin accounts means that any market movement will have an equally proportional effect on deposited funds. This may work in your favor or not. There is the possibility that you could sustain a loss greater than funds deposited when you trade spot currencies should the market move against your positions. Losses may exceed deposits. Traders may lower their exposure to risk by employing risk-reducing strategies such as stop-loss or limit orders.
There are also risks associated with utilizing an internet-based deal execution software application including, but not limited, to the failure of hardware and software.
In the “off-exchange” Forex market, there is no central exchange.
Firms are not restricted to effect exchange transactions. The clearing firm with which you deal may be acting as your counterparty to the transaction. It may be difficult or impossible to liquidate an existing position, to assess the value, to determine a fair price of to access the exposure to risk.
For these reasons, Forex transactions may involve increased risks. Off-exchange, also referred to as over-the-counter, transactions may be less regulated or subject to a separate regulatory regime.
There is considerable exposure to risk in any off-exchange foreign exchange transaction, including, but not limited to, leverage, creditworthiness, limited regulatory protection and market volatility that may substantially affect the price, or liquidity of a currency or currency pair.
Before you undertake such transactions, you should familiarize yourself with the applicable rules and attendant risks.
Leverage is about risk management. When a trader increases leverage in a trade, there is both the opportunity to make bigger profits and equally, if not more, have bigger losses.
Leverage is the use of borrowed funds to improve one’s speculative capacity to potentially increase the rate of return from an investment, at the risk of greater losses. Leverage allows traders to borrow money and use that money to invest in the foreign exchange market.
Because of leverage, clients without a huge amount of capital are able to make large investments, whereas in other markets such as the equities market, clients would have to pay 50% of the full amount for each share of stock they were investing in. With new regulations, U.S. market makers allow positions to be leveraged up to 50:1. This means that if a trader wants to buy 1 “lot” worth of $100,000 with 50:1 leverage the trader only has to put up $2,000 for a standard lot account. If trading a mini lot account, the trader puts up $200 to trade at 50:1 for 1 mini lot worth $10,000.
More over, the leveraged nature of forex trading means that any market movement will have an equally proportional effect on your deposited funds. This may work against you as well as for you. The possibility exists that you could sustain a total loss of initial margin funds and be required to deposit additional funds to maintain your position. If you fail to meet any margin requirement, your position may be liquidated and you will be responsible for any resulting losses.
CompassFX aims to provide clients with the best pricing available and to get all orders filled at the requested rate through our clearing firm parties. However, there are times when orders may be subject to slippage due to an increase in volatility or trading volume at the clearing firm. This commonly occurs during economic news events.
The volatility in the market may create conditions where orders are difficult to execute, since the price might be many pips away due to the extreme market movement. Although the trader is looking to execute at a certain price, the market may have moved significantly and the order would be filled at the next best price or the fair market value. Similarly, increased trading volume may also result in slippage if sufficient liquidity does not exist to execute all trades at the requested rate.
Once a stop limit or stop loss order is triggered, it becomes a market order, and there is no guarantee it will be filled at any particular given price. Therefore, stop orders may incur slippage depending on market conditions.
The concept of slippage is not unique to the forex market, as it often occurs in the equities and futures markets.
Delays in Trade Execution
A delay in trade execution may occur for various reasons, which may result in delayed orders or price requotes from the clearing firm. Often, the cause of delay execution is with the trader’s internet connection to the clearing firm’s servers.
It is possible that a trading platform on a trader’s computer may not maintain a constant connection with the clearing firm servers due to a lack of signal strength from a wireless, hard-wire, or dialup connection. A disturbance in the internet connection between the trader’s computer and the clearing firm’s servers can sometimes interrupt the data feed and trade execution signal, thus disabling the trading platform from proper functioning and causing delays in transmission of data between the trader’s platform and the clearing firm’s servers.
Compass FX has always been committed to maintaining the confidentiality, integrity and security of personal information about our current and prospective customers. We understand that privacy is an important issue for you, and we want you to understand how we work to protect your privacy when we collect information about you.
HOW WE OBTAIN PERSONAL INFORMATION
In providing you with financial products and services, or information about such products and services, Compass may collect public and non-public personal information about you from the following sources:
- your account agreements and other related documents and forms (for example, name, address, social security number, birth date and financial information);
- transactions with Compass or its FCM (for example, trading history, history of meeting margin calls, and your use of various products and services that we provide);
- outside entities, including credit reporting agencies, to obtain information (such as verification of identity, credit-worthiness, credit history, purchasing and investment preferences).
HOW WE PROTECT YOUR INFORMATION
It is our policy not to release your personal information except as permitted by law, requested by you or set forth below. Within Compass, we restrict access to your personal information to those who require it to provide products or services to you.
We maintain physical, electronic and procedural safeguards to protect your personal information. These safeguards include limiting access to data and periodically testing our security technology.
Within Compass we may share information about you for several reasons, including:
- to assist us in providing services;
- to help design and improve products;
- to offer products and services that may be of interest to you.
In the course of doing business we may share information with third parties, which could include personal information about you. Personal information may be shared with others for the following reasons:
- in response to a subpoena;
- to prevent fraud;
- to comply with inquiries from government agencies or other regulators;
- for other legal purposes.
We also may share personal information:
- with others that service your accounts, or that perform services on our behalf;
- with others with whom we may have joint marketing agreements. These include financial services companies; financial services providers, such as introducing brokers, broker/dealers, futures commission merchants, investment companies, investment advisers, commodity trading advisers and commodity pool operators;
- publishers and other direct marketers of products related to the financial services industry, such as newsletter or book publishers and software or trading system developers;
- to other non-affiliated third parties with your consent, at your request or as permitted or required by law.
OPT OUT NOTICE
Personally Identifiable Information – In general, you can visit the Compass FX website without telling us who you are and without revealing any information about yourself. There are times, however, when we might request that you disclose certain pieces of personal information to us. You may choose to disclose this information, such as your name, address, or e-mail address. Please note that if you choose not to disclose this information, functionality of our site may be limited. This personally identifiable information is never rented, sold or disclosed to any third parties.
Copyright & Trademarks – All rights reserved. All content (texts, trademarks, illustrations, photos, graphics, files, designs, arrangements etc.) on the CompassFX website are protected by copyright and other protective laws. Without the explicit written permission of CompassFX, it is prohibited to integrate in whole, or in part, any of the protected contents published on these websites into other programs or other web sites or to use them by any other means. This website can contain elements that are protected by copyright and by other laws that are subject to the copyright or other rights of third parties and that are correspondingly protected for these third parties. For example, some images on the homepage are owned by www.vpsi.org and are being used under the Creative Commons Attribution 2.0 Generic license. Compass FX reserves all rights to the content it owns. The use of this site does not transfer ownership or rights to anyone other than the rightful legal owner.