Beware! Alphaforexmarkets is an offshore broker! Your investment may be at risk.
RECOMMENDED FOREX BROKERS
Don’t put all your eggs in one basket. Open trading accounts with at least two brokers.
The interface of Alphaforexmarkets looks cheerful with its links and pictures in primary colours more suitable for a children’s book rather than a forex trading website. But is this broker as innocent as it looks? Let’s dig deep to find the answers.
Alphaforexmarkets Regulation and safety of funds
From the information provided on its website, we understand that Alphaforexmarkets has its main office in the UK and a branch office in St. Vincent and the Grenadines. We searched the register of the Financial Conduct Authority (CFA), the official body that regulates forex brokers in the UK to verify whether this company is registered there. The image below clearly shows that this company does not exist in the FCA register, therefor it is non-legit and most probably a scammer.
Another proof that this broker is not to be trusted is the fact that the branch office is in St. Vincent and the Grenadines (SVG) which is an offshore zone for forex trade without a regulatory body for forex trade which means that Alphaforexmarkets is not registered or regulated in this jurisdiction either.
You must know that forex brokers in the UK are strictly regulated and they must meet some stringent requirements in order to get their license. First of all, they must deposit an initial capital of no less than 730,000 EUR which among other things serves as a barrier against scammer as they will never invest so much money just for the benefit of looking legit. Other requirements include keeping clients’ funds separately from brokers with tier-1 bank establishments, report transactions on regular basis, provide protection against negative balance, have external audits, keep low leverage, etc. One of the big advantages in trading with UK brokers is that they participate and deduct funds towards the local Financial Services Compensation Scheme from which in case of bankruptcy their clients can be reimbursed up to 85,000 GBP per client.
Regulated brokers in the EU must also match these requirements which are imposed by the European Securities and Markets Authority (ESMA) and in addition to that, they participate in local investor compensation funds from which the clients of a broker who goes bankrupt can be reimbursed up to 20,000 EUR per client.
Alphaforexmarkets Trading software
Alphaforexmarkets trades in forex, cryptocurrencies, CFDs, indices, metals and futures. The trading software available to the clients is the MetaTrader 5 trading platform which is considered to be one of the leading platforms in forex trade. MT5 is equipped with an auto trading option, trading signals, code base with customs scripts, VPS, a financial calendar, an app market, etc., which makes it very competitive compared to other platforms. When in 2016 the hedging option was added to it, MT5 became even more popular with brokers and traders alike.
We opened a demo account to show you what the platform looks like (image below). On the left-hand side, you see the menu with trading products together with their bid/ask price and beneath, the navigator for the accounts, indicators, expert advisories, scripts and services. We must say that MT5 is equipped with an array of technical analysis indicators, such as moving averages, Bollinger Bands, Fibonacci retracement, etc., that help traders predict the future direction of exchange rates and make a profit. In the middle of the screen, you can see displayed 4 charts of 4 different currency pairs with the fluctuation in price in a given time frame. The number of charts can vary according to the trader’s needs and there is a rich choice of charts, time frames, colours and even the option of creating customised templates that MT5 provides to the traders to enhance their trading experience.
A good quality trading software is a prerogative in forex trade but most importantly is how the parameters are set by the broker as it affects the cost of transactions and the scope of profit or loss.
From the information available on Alphaforexmarkets website, we find out that the spread for ECN is 0.1 pips but before we rushed to say how good the spread is, we opened the information about the trading account types (last image). What we saw there turned our smile upside down. The spread as shown in George account is 30 pips. Furthermore, this account with a low initial deposit is likely to attract more potential traders compared to the other accounts with a higher initial deposit. Now, compare this spread of 30 pips with the industry average of 1.5 pips and you will see an enormous difference. The implications for traders are that spread which is above the industry average will increase the cost of transactions and traders won’t be able to make a sustainable profit. On the other hand, the broker who derives revenue from the spread will get richer by fleecing its traders. Don’t become this broker’s cash cow!
Another danger sign is the leverage as shown on this broker website which is 1:500. Firstly, this is another proof that this broker is a scammer as licensed brokers in the UK have leverage which is capped at 1:30 which is a means to protect clients’ funds. Secondly, trading with high leverage increases the risk exposure of clients’ funds who may suffer significant financial loss amplified by the high leverage if the transactions are unsuccessful.
Alphaforexmarkets Deposit/Withdrawal methods and fees
We applaud Alphaforexmarkets for the creativity in naming its 11 trading accounts (image below)! The minimum initial deposit for the DeCent account is $10 and the highest initial deposit is for the ECN Pro account – $5,000. All of the five ECN accounts have commission whereas the other accounts are commission-free.
The payment methods include payments made via credit card, WebMoney, Neteller and Skrill.
While perusing the information available on Alphaforexmarkets, we noticed that the Terms and Conditions document is such only by title and does not contain the legalities of trading with this broker. Instead, it stipulates the conditions for a contest named ‘Money management’ which consist of the following conditions: traders are given 3 months in which to trade 500 standard lots after making a deposit of $1,000. The winners will get some nice prizes which include Apple iPhone or iPad and even an overseas tour. Nice, right? Wrong! First of all, this is another proof that this broker is non-legit and fraudulent as licensed brokers in the UK are banned from offering this type of incentives. Secondly, this ‘contest’ looks like trying to lure traders into investing a high amount of deposit while asking them to fulfil impossible conditions. A nice way to swindle people we must say.
How does scam work?
Scam works in different ways. It could be either that you receive an unsolicited telephone call or you see one of these flashy ads on the Internet or the social media promising you a quick and easy profit. Scammers will promise you the sky and the earth until you give way to temptation and deposit money. Once you give them money you get caught in the scammers’ mousetrap and the cheese in the shape of a big fat money fall is gone! It may take some time before you realise that you are being scammed. Scammers are smooth talkers and they are masters of deception. They will give you some excuses as to why the big profit hasn’t come yet and will try to lure you to make even a bigger investment because according to them, the more you invest, the more you profit. After you have been waiting for a while and you finally come to your senses, you realise that you are being scammed. All you want now is to get your money back and get out of there. However, the scammers won’t make it easy for you! They will try to delay you so that you miss the deadline for applying for a chargeback.
What to do if scammed?
There are a few things that you must do immediately – file for a chargeback if you have paid using a VISA or MasterCard. Those two payment providers allow you 540 days time frame within which you may file for a chargeback.
However, the chances are grim if you have used bank transfer or Bitcoin as a payment method. There is no chance you’ll be able to recover your money.
In such a desperate situation, some so-called ‘recovery agents’ may approach you with offers to recover your money for a fee. Be cautious as you may be dealing with another type of scammers. Always check the information about the recovery agency – make sure it is legitimate and transparent in the public eye. Also, some scammers publish personal comments after our review about how they have been scammed and how they found a recovery agent who helped them get their money back. Do not trust such comments and do not use the published contact info in them as it will lead you to another scammer!
And lastly, a reminder to cancel your credit card if you have given your CVV code to the scammers and erase any software from you PC that gives the scammer access to your personal data.
hari
worst broker without any proper thing