MiFID II, 2018 “the first year of awakening” for the retail forex traders!
The Markets in Financial Instruments Directive II
(MiFID II) represents the European Union’s ambitious attempt to create a single rulebook for the region’s financial markets whilst also governing third country access to its investors. A vast, sprawling piece of legislation that seeks to build on the existing requirements, adding in electronic execution elements of the Pittsburgh G20 Trading Commitment, to tackle an interconnected group of issues and ultimately:
MiFID II implemented almost a month ago, cannot help someone asked: MiFID II implementation, in the end, who is the biggest beneficiary? The answer to this question is not difficult to estimate: of course, retail forex traders, commonly known as forex little scattered. 2018 Under the MiFID II, the retail forex traders “awakening first year”!
MiFID II will enable the financial sector to become fairer and more transparent, which will retail forex traders to provide more a more effective, more attractive investment market. So, MiFID II in the end what tangible benefits can give forex traders bring it?
The most obvious benefit is reflected in information disclosure, MiFID II requires brokers to fully disclose all information related to customer transactions, including pricing, execution, all details of the transaction, transaction costs and other details. Before brokers are reluctant to disclose, or intentionally concealed, missing information, it will be fully available to the public. Forex small, scattered, who will no longer be kept in the dark white (crazy), transparency of information so that foreign exchange small, scattered, who has more right to know, to get a greater initiative in defending their interests on.
Let’s take stock of what some of the rights of retail traders, or so-called benefits of MiFID II:
1. Best Execution reports, including counterparty information disclosure
MiFID II provides that: according to the reasonable demands of customers, investment companies (investment banks, brokers, and other financial institutions) should customers (or potential customers) to provide “order is executed the other entity or transaction (counterparties)” relevant information.
Thus, as a retail forex trader, you can ask the broker to provide complete reports on the implementation of your transaction to you, including your transaction information disclosure counterparty. So you can clearly know your order is broker “internalize” the (B-book), or indeed transferred to the implementation of the liquidity in the market (full STP).
2. Fully transparent pricing, fees, commissions Jinming fine Disclosure
MiFID II provides that: After confirming the order execution, investment firms should be sent as soon as possible to the customer notification, notification no later than the first trading day after the order execution, if investment companies that need to get confirmation from a third party, the notification no later investment in the first trading day after the company received confirmation.
Notify the customer when the order fulfillment status, the notification should include: the sum of all commissions and fees if the customer should be provided with all the relevant details of changes in costs, if the customer’s order is executed inside account investment company (ie ” internal digestion “), then the investment company to respond to customer bears the responsibility for best execution.
If the client’s counterparty was the investment firm itself or any person serving in the investment company, investment company or any other client, then it belongs to the case of investment company “internalize” the.
Thus, as a retail forex trader, you can ask the broker to provide full details of the report you to your orders, which should include: accurate price quotation, precise execution price, execution venues, details of all commissions, fees, either IB (or other form of proxy) fee (commission fee) or other additional costs. Moreover, these reports should be sent to you within 24 hours.
3. batches order execution disclosure, VWAP details
MiFID II provides that: If the customer orders are executed in batches, investment companies should provide “price per transaction and the average trade price .”
Therefore, a detailed description if you order through the times, to be executed in batches, then you can ask the broker provides forex trading volume weighted average price (VWAP) execution of your order to you.
MiFID II requirement for transparency of information, a lot of behind the “secret information” make a lot we do not know the original “secret information” to be made public, and before that financial institutions often hides a violation of the interests of ordinary investors. Transparency of information to defend their legitimate rights and interests of the industry to create a fair and favorable environment for ordinary investors.
With the implementation of MiFID II, in 2018, foreign exchange will be small, scattered from their “ignorant” to “sensible” turning point, the year of the retail forex traders awakening.
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