The Financial Commission’s board has approved a new applicant to join the self-regulator’s member roster, which is made up of online brokerages operating in FX, derivatives and cryptocurrency markets. This round of approved applicants includes a Nigerian FX broker called Eagle Global Markets.
The FinaCom PLC has also issued an execution certification for TitanFX as the industry-specific association attempts to reduce the number of execution-related disputes that occur before they progress into formal complaints.
The FinaCom’s assessments depend on VerifyMyTrade, a post-trade solution that has developed capabilities to accurately measure the execution quality of positions across the retail FX market.
The “value-added” service allows clients of the commission’s brokerage members to use its analysis tool to check whether their trades were fairly priced or not.
Verify My Trade consolidates price feeds from dozens of retail forex brokers to produce statistical box plots, which are a representation of the minimum, maximum and percentiles of the ticks received for every second of the day.
To maintain their certified status, the audited platforms are required to continuously submit their order execution data to the VMT analysis tool, which maps the execution price to the boxplot for that time of day to assess the effectiveness and quality of the broker’s execution.
Due to the price verification capabilities, brokers who implement the service would be able to settle price disputes internally, by inducing evidence on asset prices at any given time, from an impartial party.
And in case the client claims that he is consistently getting poor execution, the analysis results will facilitate handling execution-related trade disputes.
Meanwhile, the acceptance of Eagle Global Markets’ application by FinaCom PLC gives the retail broker an A-category membership status which means that its traders can be eligible for compensation of up to €20,000 per submitted claim and have access to all dispute resolution services offered by the commission.
According to its latest annual report, the self-regulator received a record number of complaints in 2020, which were up 32% year-over-year as a record $10.9 million sought by traders this year, which is up from $7.4 million in 2019.
Likewise, the number of resolved complaints in ‘clients favor’ increased 31% from the previous year. Of all resolved complaints, 52% were resolved ‘in favor of the broker‘ and 18% resolved ‘in favor of the client’, while 30% of cases the commission assessed were found to be out of its jurisdiction.
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