News: PFGBEST has found a SOLUTION to the new FIFO Rule

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As you are all aware the NFA has made a new rule that prohibits registered Forex Dealer Members from carrying offsetting positions past end of day ("no -hedging"). The rule will also require all positions to be offset in the order they were opened beginning August 1, otherwise known as 'First In First Out' (FIFO). There has been wide speculation among trade groups and more specifically Non Regulated Forex Brokers offshore what these changes may bring, to clients and Expert Advisors. Below is an email generated by the NFA to each of its Members, assuring that indeed it is not the interest of the NFA to eliminate vital risk management tools like Stop Loss and Take Profit orders. Furthermore, they will discipline any Member that is misleading investors with false information. It is of PFGBEST's and the NFA opinion that clients be able to continue to use these order types as a means of risk management .

The 'No-Hedging' rule has been in effect since May 15, and as many of you can attest the implementation of this rule by PFGBEST has had little affect on client strategies. The FIFO rule implementation on the other hand will likely cause most NFA Regulated FDM's to change the way their MetaTrader 4 platform operates because the MT4 Backoffice doesn't have the flexibility to offset positions in a FIFO manner as required by the NFA and retain all order functionality. There have been parties who have propagated fear among investors about 'not being able to use Stop Loss and Take Profit orders'. BEST Direct MT4 and PFGBEST.com made a decision 1 ½ years ago when we began integrating our Straight-Through-Processing environment to our proprietary Backoffice. This will allow us to comply with regulations and continue to offer BEST Direct MT4 in the capacity we do today.

Clients will be able to continue to use their Expert Advisors and trading strategies with out having to make any adjustments. Stop Loss and Take Profit orders will be fully functional, including Trailing Stops.

PFGBEST will be holding Webinars to educate clients on the process that will be in place in our Backoffice. Please feel free to join us to fully understand how PFGBEST is approaching this issue. Clients of PFG will be notified by their brokers and by email of all upcoming instructional Webinars. We look forward to continuing to offer MT4 in a capacity that gives clients the tools to remain successful within a stringent U.S. regulatory environment.




To: NFA Member FDMs
Re: Communication with the Public Relating to NFA Compliance Rule 2-43
NFA has become aware of false or misleading blog entries and e-mails to customers stating or implying that NFA has banned stop orders and limit orders. As you know, Compliance Rule 2-43(b) does not prohibit either type of order but simply requires that executed stops and offsetting limit orders be applied to the oldest open position or, at the customer's direction, to the oldest open same-size position.

Please ensure that neither your employees nor any firms or individuals that introduce forex business to or manage forex accounts carried by your firm are spreading misleading information about the effect of Compliance Rule 2-43. As you are aware, under NFA Compliance Rule 2-36(d), an FDM is subject to discipline for the activities of persons who solicit, introduce, or manage customer accounts. Therefore, NFA will not hesitate to file an enforcement action against any FDM with an introducer or account manager that initiates, spreads, or condones statements that convey false information.

BEST Regards,
PFGBEST BESTDirect MT4 Division