NIBA - Celebrating 35 Years

NIBA Journal

Insights, analysis, and updates from the National Introducing Brokers Association

Retail Forex Comes In From the Cold
Marketing
6 min read

Retail Forex Comes In From the Cold

by Erich Grant, Shift Forex On October 18th 2010 the NFA and CFTC issued a set of new rules governing the retail forex industry, dramatically tightening the regulatory regime under which forex firms operate. Many in the retail forex industry feared the new set of regulations would push most or almost all of the business out of the United States. Indeed, many market participants have been forced to cease doing business or have pulled out of the country and stopped accepting US clients. Far from destroying the industry, these new regulations have laid the groundwork for the next dramatic stage in the forex growth story. While tightened regulations have decreased the per-trade profitability for brokers and some market participants, the newly legitimized industry can now begin to further build its reputation and promote the spread of forex as a true alternative asset class. US-based customers are now legally mandated to...

By NIBARead article
Jackass Investing: Don’t do it. Profit from it.
Marketing
4 min read

Jackass Investing: Don’t do it. Profit from it.

Also released under the title: Exploiting the Myths Published 2011 by Ignite LLC In this informative, entertaining, and quick read, the author - Mike Dever, Founder, CEO & Director of Research of Brandywine Asset Management examines the misconceptions or “myths” of current investment theory and replaces it with what he describes as a "return driver" based methodology that results in both greater returns and lower risk. I read the entire book on a recent flight from San Diego to Chicago to attend a NIBA meeting. I wasn't planning on finishing it in one sitting but once I started I couldn't stop. It is very well written, and I thoroughly enjoyed it. A few weeks later I had the book with me again on a flight back from vacationing in Colorado. A fellow passenger noticed the provocative title and commented, “Jackass investing? All investing is jackass investing…nobody makes money investing.” If...

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Sciota Trading | Focus on the Membership July 2011
Marketing
3 min read

Sciota Trading | Focus on the Membership July 2011

About the Firm: How did you get started? Do you provide additional services besides brokerage? We originally started as a small IB in Minnesota which wanted to expand into Iowa. I was hired to start the Iowa office. In the beginning it was all cold calling, all the time. It was very hard work, but after a tough first couple years it started to pay off. Our primary business today is cash grain and livestock marketing consulting. We use brokerage to assist us with achieving the risk management and pricing goals of our clients. What are the biggest challenges your clients face today, and how do you help them? The extremely volatile price action in the last several years has really increased risk for the ag producers we work with. Costs are skyrocketing along with output values. We help clients by trying to make the complexity of the various market...

By NIBARead article
Outlook for Copper: A case for higher prices?
Marketing
6 min read

Outlook for Copper: A case for higher prices?

OUTLOOK FOR COPPER: "COPPER - A CASE FOR HIGHER PRICES?": In terms of prices, the first-half of this year has fared far better than many were expecting.The broader economic climate has already shown signs of improvement and has surprised many analysts whom had not forecasted this occurrence until the 4Q. However, it appears that the market bulls had got ahead of the game in Copper as prices have seen five consecutive monthly closes higher, and we are presently sitting in view of making it six in a row. The question is where has this optimism come from when economists have been proclaiming doom-and-gloom from the demand-side perspective... A significant part of the stronger picture has been derived from the voracious appetite of China, the world's largest consumer of the metal. Copper imports into China have leapt to record levels as the State Reserve Bureau has increased its strategic stockpile buying....

By NIBARead article
Stand Apart From Your Competitors | Build Power with a Strong Brand
Marketing
3 min read

Stand Apart From Your Competitors | Build Power with a Strong Brand

by Lida Citroën Principal | LIDA360, LLC Imagine you are a client looking to find an introducing broker. To you, there is no clear difference between one broker over another. How would you choose? Most likely, all things being equal, you would chose the least expensive one. After all, why would you pay more – all things being equal? In brand marketing, we call this a commodity sale: The consumer chooses based on price when there is no clear differentiation of perceived value. Is this how you want your brokerage clients to chose you? Is your value to your clients that you are the cheapest solution to their needs? Are all things created equal when choosing a broker? What is a personal brand? A brand is an emotional connection in the hearts of your clients and the audiences they influence. Branding helps companies (and individuals) identify their desired reputation. Your...

By NIBARead article
In the Future IBs and Financial Advisors Compete Head to Head
Marketing
5 min read

In the Future IBs and Financial Advisors Compete Head to Head

By Mark Melin | Author High Performance Managed Futures and division director at PFGBest. The growth in managed futures points to increased competition coming from the traditional Wall Street financial advisor. The question is: how can IBs manage this threat? The biggest weakness many financial advisors have when discussing managed futures is their lack of understanding the asset class. There are five key points advisors must understand in order to carry on an intelligent managed futures conversation, some of which was outlined when Northwestern University had its four hour educational course on the topic this March 19. IBs must understand these key points and communicate them properly. When facing challenges from the equity world it is important IBs employ the right tactics. The IB that succeeds against financial advisors may have these characteristics in common: 1. Understanding of Trading Strategies: Most financial advisors don’t understand the critical difference in strategies...

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How will the Proposed Swaps Regulations Affect IBs?
Marketing
4 min read

How will the Proposed Swaps Regulations Affect IBs?

Regulation of the OTC derivatives markets was a hallmark of the Dodd-Frank Act. While the swaps regulations will take time to implement, and may not necessarily impact Introducing Brokers in a direct manner, IBs should nonetheless pay attention to the swaps regulation drama for a couple of reasons. First, the CFTC’s focus on swaps means that their attention is not on other proposals, like Proposed Regulation 1.71. Secondly, as the swaps regulations begin to take form, there will be time and opportunity for IBs to modify their business models to capitalize on the new systems. Proposed Regulation 1.71 Proposed Regulation 1.71 has quickly taken a backseat to the swaps regulations. In broad terms the proposal would require FCMs and IBs to implement certain “Chinese Wall”-like procedures to ensure there are no conflicts of interest with respect to research and execution. While such a concept may work in the context of...

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Chairman's Message | June 2011
Member Announcements
2 min read

Chairman's Message | June 2011

Dear NIBA Members and Supports, Year 2011 marks the 20th Anniversary of the NIBA. Since 1991 we have held over 35 membership meetings. Every meeting is planned with input from our members, which includes suggestions for topics and speakers. The number one topic suggested is a discussion and update of CFTC and NFA rules and regulations. Most IBs and CTAs feel they get little, if any, advanced warning from their clearing FCMs and others when rules which affect their business are changed or enacted. Even those IBs and CTAs who regularly check the agencies’ websites, generally have to sort through numerous proposals which only apply to FCMs or hedge fund operators or other registration categories or processes. Rules, regulation and compliance issues are a part of every NIBA meeting. Year after year our IB, CTA and AP members say they rely on the NIBA twice-annual programs for easy-to-understand presentation and...

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6 Reasons to Embrace Inbound Marketing
Marketing
6 min read

6 Reasons to Embrace Inbound Marketing

by Phil Donaldson and Candyce Edelen | PropelGrowth Phil Donaldson Email: pdonaldson@propelgrowth.com Twitter: @PhilDonaldsonNJ Phone: 212.812.3998 Candyce Edelen Email: cedelen@propelgrowth.com Twitter: @CandyceEdelen Phone: 212.738.9445, ext. 501 In today’s digital age, consumers and business people are looking to the Internet to find information to guide nearly every important decision they make. At the same time, their degree of patience for and trust in traditional advertising is plummeting. The statistics aren’t pretty. We found conflicting information about just how how bad it is, but suffice it to say, people generally don’t trust advertising. In his book “Marketing to the Social Web,” Larry Weber found that only 14% of people trust advertisements. The Alterian report “Your Brand: At Risk or Ready for Growth?,” found that only 5% surveyed trusted advertising and that a mere 8% trust what companies say about themselves. HubSpot recently published research findings that showed the ROI for traditional advertising...

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Anticipating the USDA Acreage Report The 2011 Outlook for Corn, Soybeans and Wheat
Marketing
1 min read

Anticipating the USDA Acreage Report The 2011 Outlook for Corn, Soybeans and Wheat

When: Tuesday, June 28, 2011 at 2:00 p.m. CT Where: CME Group Visitor's Center Auditorium 141 W. Jackson, 5th floor Chicago, IL 60604 The current conditions in agricultural commodities have created much volatility in the grain markets. In anticipation of the June 30 USDA 2011 Acreage report, please join us in a discussion of the summer's grain prospects and the impact of the recent weather crises. The discussion will also include a trader's perspective on the new Weekly Grain Options, which provide opportunities to trade high impact events?such as USDA reports and weather conditions. Since their launch on May 23, Weekly Corn, Soybean and Wheat options have traded more than 40,000 contracts, including a record 7,080 the day before the June 9 USDA Crop Production report. Topics include: Perspectives on acreage Current weather trends 2011 yield potential and price outlook Capitalizing on opportunities with Weekly Grain Options Speakers: Tom Shuff...

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