Running a Forex brokerage is a really tough business.
Oh the stories I've heard….
So why would anyone want to start one?
In this episode, I sat down with Arif Ahmad, co-founder of Scandinavian Capital Markets (SCM), a ECN broker in Stockholm Sweden. As it turns out, Arif had good reasons to get into the brokerage business.
As money managers, they were tired of getting pushed around by shady FX brokers. They figured that they only way to get good service was to provide it themselves.
That is how SCM was born.
They are based in Stockholm, Sweden and as it turns out, there are several advantages to having a brokerage there. With many countries reducing Forex trading leverage to 30:1 or lower, it is becoming harder to find brokers that will support more highly leveraged trading.
Obviously, leverage is a double-edged sword and not for the beginner. But I personally believe that traders should still have the option to be able to access higher leverage.
Having a broker in Sweden gives traders the advantage of still being able to access 100:1 leverage, in a country with a stable banking environment and a reasonable amount of regulation.
The alternative is usually to go to places that are havens for dodgy offshore brokers like Cyprus or Malta, which are like the Wild West, when it comes to regulation.
As I've mentioned before, the best broker for you will depend on where you live, how you trade and what you value in a broker. So always do your own due diligence when choosing a broker.
Even if you aren't looking for a new broker, this interview is an inspiring look at the entrepreneurial journey of two guys who saw an opportunity to create a better product and are working hard to make that happen.
I hope you enjoy listening to this interview as much as I enjoyed doing it.
Note: Since they are based outside of the US, they cannot accept US clients…per US laws.
In This Episode
- How Arif got screwed over by Forex brokers as a money manager
- Why Sweden is a great place to have a Forex brokerage
- What led to the formation of Scandinavian Capital Markets (SCM)
- The cultural changes that SCM wants to create in the Forex world
- And more!
Click Play to Listen to the Interview
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Thanks for Listening!
I really appreciate you joining me for this episode of the podcast. If you have any feedback on this episode, please be sure to leave a comment below.
If you know of a trader who would benefit from any of the information in this post, feel free to share it with them. Be sure to subscribe to the show on iTunes and if you love it, a 5-star review is greatly appreciated!
I also want to thank Arif and Michael for flying me out to Stockholm, putting me up at a great hotel and showing me the beautiful city of Stockholm. If you have never been to this beautiful city, I would recommend you put it on your Heroic List.