One of the most important rules for you to remember when you are searching for an online broker is appearances can be deceiving. Just because a company has an impressive and attractive website is no guarantee that they are trustworthy and can offer you quality services. You can find thousands of stories of people who fell for the appearance and had to suffer at the end of the day. Your priority is to avoid these dire consequences and this can only happen when you are diligent. This THEHOTFX review indicates just how convincing a scam broker can be.
According to THEHOTFX website, it is a well-established and leading forex broker, which is renowned for its customer-oriented approach and education and promises a one-stop trading solution for all. You can expect to have access to a user-friendly trading platform, generous trading bonuses, leverage as high as 1:200, four account types and tight spreads. All of this does sound like a good deal and even though it is tempting to trust the broker, you have to do a follow up. The review below comes in handy:
Regulation and Licensing
Checking the regulation and licensing of a broker is the first thing you need to do and a look at THEHOTFX website indicates that it has an office in New York. In order to operate from the United States, the broker would have to be licensed by the Commodity Futures Trading Commission (CFTC) and also be a member of the National Futures Association (NFA).
However, a check of the registers of both these organizations shows that THEHOTFX is not regulated or licensed and if it really is based in the US, then it is doing so illegally. Moreover, when you go through their Terms and Conditions, you will find a vague reference to the Marshall Islands, which indicate that the company is actually based in the offshore jurisdiction. As there are no other details given, essentially you have an anonymous website that doesn’t offer any knowledge of the company that’s actually behind this broker.
As mentioned earlier, THEHOTFX promises generous trading bonuses to its clients, but it is important to note that these are banned in most regulated jurisdictions. This includes the United States, where the brokerage is allegedly based. Hence, it is breaching regulatory policy by offering these bonuses. Furthermore, it is taking advantage of the exact aspect of these bonuses that resulted in their banning in the first place; exploitation of traders.
As per the Terms and Conditions of THEHOTFX that pertain to the trading bonus, traders have to achieve a minimum trading volume requirement before they are allowed to make a withdrawal. As per the policy, traders have to have a minimum trading volume of $2,000,000 for a $100 bonus. This is downright malicious because achieving such a volume is no easy task, which means your funds will be trapped. This is a common tactic that scam brokers use for gaining control of their clients’ funds.
Another feature you will come across on THEHOTFX website is that of daily recommendations that are offered with every account type. In theory, the concept sounds great because you will be given recommendations about what to trade in order to make profits. In reality, it confirms that the brokerage is a scam because this is a conflict of interest.
Every broker is by nature a market maker, which means they make profits when traders lose. Thus, THEHOTFX will never give recommendations that will help their clients because it would lead to their losses. They will deliberately suggest losing trades, pushing you to lose your money, as it means more profits for them.
You will find a basic and cheap web-based trading platform at THEHOTFX that doesn’t even come close to the MT4 or the MT5, which are the leading solutions in the market.
All of these problems that you identify about THEHOTFX indicate that is not a trustworthy broker for anyone.