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Trader Alert: Beware of Forex Bucket Shops

Trader Alert: Beware of Forex Bucket Shops

6 Years ago | August 25, 2014 00:00:00

I get asked a lot for suggestions about specific brokers and which broker to choose. Some brokers I never heard of and it got me to thinking about the different tiers of forex brokers. It also got me to thinking about the term forex “bucket shop.” This generally refers to a broker who “buckets” all or most of its trades and takes them on its own books without going to the market (it may pass through the trades of profitable traders only). In other words, it is betting on the statistics that most retail forex traders lose money and thus is willing to take the other side of most trades. The question is why should you care?

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