LeapRate caught up with the CEO of NZ based Forex broker FXPIG Kevin Murcko, discussing the industry from his point of view and how he runs his brokerage, which you can read all about in the following Q and A.
Kevin is one of the most transparent CEO’s in the Forex Industry you will ever come across and has been doing his part of leveling the playing field for all traders, regardless of their experience or account size via his unique FXPIG brand which entered the market in 2010.
Since then he has been at the forefront of promoting straight through processing technologies, always trying to better the trading environment he offers to his clients with key partnerships and a focus on constant innovation.
Hi Kevin, can you talk about the history of FXPIG, how it was founded and how you became interested in FX?
Hello, first off, thanks for the invite and the ability to spread some of our self-proclaimed awesomeness on the un-expecting masses… Secondly, how many pages do I have to answer this question, which I may add is one of my favorites to answer? Out of respect for your readers, I will TRY and keep it short.
In 2009, after trading in the market for over 9 years, I came to the realization that optimal trading conditions were simply not being offered to the retail market, in fact, they seemed to simply not exist. Almost every broker was selling the same tech wrapped in a different package, and no one was actually offering tech that enhanced their client’s ability to make better use of the liquidity available to them and to maintain their own profitability. I was out right tired of getting the same response to my questions and I KNEW that there was more to this market than the canned responses I seemed to receive from any and everybody I sought some information from.
So… like all other wide-eyed and ambitious problem solvers before me, I took it upon myself to change the market from the inside out. Of course, before I could do that I needed a name (more on that later). MOST people will find a name that suits their business and then, if one exists, use the associated acronym to market their new company. I have been known to do things my own way, sometimes to my own detriment, so I actually found the acronym before I created the company name. Yeah, I CHOOSE the PIG acronym.
No, I was not forced, no I was not on medication, and no I was not paid by a competitor to sabotage my company from the get go. I actually sat down to try and find a word I could mold a company name around that lent itself to a unique and memorable brand. Before I answer your other question before completely answering this one… let me move on.
I fell into FX by mistake in 1999. I have always been interested in new tech and new ideas for generating income. In 1999 the .com bubble was essentially at its height and I was scouring the net for opportunities. I stumbled onto some investment website that was pushing a forex traded fund. Being me I thought, “If this guy can trade currencies, so can I”… Obviously, that led to a lot of demo trading, a lot of reading, a lot of losses, and eventually some ‘grown up’ realizations and a handful of years later… FXPIG (officially incorporated as Premier Interchange Gateway LP).
Can you describe the clever name FXPIG, how often to people ask you about the peculiarities of the brokerage name?
How often? Never… sorry, that was my feeble attempt to be ‘political’. We do get a fair share of questions about the name, mostly from clients that have become enamored with the brand and bring it up off the cuff. However, we do get the occasional comment on how our name is not suitable, or how our business is doomed because the name of the company is essentially the most important aspect of the brand.
Look, having been in this industry for over 16 years I can assure you that 99% of its participants take it way too seriously and they focus way too much time on creating some cloud of complexity around their company in an effort to veil their use of the same antiquated and broken systems. Marketing and brand awareness is a creature of its own. People tend to remember brands that are unique.
How has the industry evolved since you got into the brokerage end of the business?
Not enough. Regulation has and continues to be a blockade for growth and profitability as the industry continues to employ regulators that have no practical industry experience. Banking within our business has become nearly impossible, compliance fees have skyrocketed, and as a result, fees to move money have as well. The push to tighter spreads have caused banks to reduce liquidity top of book and have actually hurt the overall execution quality market wide.
However, in my opinion the real factor that needs to change is this; there is far too little focus on technology that actually enables traders to take advantage of the market. Year by year banks have lowered their risk appetites and gone from actual trading desks too automated algos that make it much more difficult for traders to maintain profitability. I could go on here for quite some length, and I would love to, but I think it may get a bit boring and perhaps it may even resemble a bit of a conspiracy theory, however, I will sum up my point here;
A few new ‘keywords’ have emerged in the last few years in regards to risk in FX and how banks classify that risk, words like ‘toxic’ or ‘toxicity’, especially after we saw a string of E.A.s looking to trade off of illiquid spread spikes, the so-called ‘tick scalpers’. This re-opened, or opened for the first time for some traders, the idea that banks will adjust their pricing or reject orders in order to not be beaten by these type of systems.
Another keyword, one not so well known is ‘decay’. Decay is essentially what makes a trade toxic. If a trade goes into profit to quickly, regardless if it is closed or not, as you need to remember banks are either sell or buy side participants, they don’t necessarily care if on the other side you make or lose money, it means the level of decay is high.
Essentially the bank on the other side of the trade needs time to offset that trade with another player in the market, make the spread and gain some additional commission, and when the decay is low they can do that relatively easily. BUT if your trades are in the green in under say 3 to 5 seconds, even if you hold them for minutes, for hours, or for weeks… no one wants your business.
My point? Banks do a TON of research and analyze aspects of your trading you NEVER thought of, and when you try and best them, at the game THEY invented… you better be prepared… and unfortunately, NO broker in this industry helps you prepare for the absolute most DIFFICULT part of trading. Why do you ask? Well, simple… most of their clients lose and they are fine with that.
We see FXPIG has redesigned its website, started a FXPIG MasterCard program for traders and consolidated platforms, what other recent developments have taken place?
A lot of what we do, a lot of what we work tirelessly on, is not really visible to our clients… until they take a few trades. Most of our blood and sweat and almost all our tears go into our trade tech, in an ongoing effort to level the field and give retail traders the ability to actually experience stable profits without having to jump from broker to broker and b-book to b-book.
Most brokers say that traders are behind their company and that they know what it’s like to be a trader… kind of like when a car salesman says he has the same car you are interested in and it’s the best and most reliable car he has ever owned… but here at FXPIG we don’t just make empty promises we live to fulfill them and we prove it daily with our commitment to our clients.
Aside from core trade tech we recently reintroduced cTrader to our client base. We initially soft-launched it in 2014 but we were not happy with the reception at that time and we felt the product needed more time to mature… and it has.
As you mentioned the website has been completely redone and our client portal is being upgraded daily as we add new feature sets, new deposit and withdrawal options, and further enhance the overall experience. There are a LOT of things in the pipeline in regards to the portal and it’s all very exciting, things that no other broker has really attempted, and things I know ALL traders will be overjoyed to see.
Do you have an active partner network?
We do have a few larger Introducing Broker relationships, but unlike most brokers, we have been quite selective as to who we choose to do business with. This does not mean we do not have smaller IBs, we do, but we like to vet ALL partners to ensure that the entire chain is held up to a higher set of expectations than the competition.
What are the plans for the future, any plans for expansion?
Of course. We are constantly expanding on several levels; first and foremost, on the technology side. We employ our own trade tech team and development never stops. We also continue to build out our MyFXPIG portal, adding new feature sets, expanding functionality, etc. All this as we look to expand our footprint in the near future, opening some other offices and exploring different regulatory options.
Where are your most active client bases, are you at liberty to discuss broker client numbers, volume metrics, etc.?
We are not the biggest, nor are we the smallest, but we are unique in one VERY specific way… the majority of our clients actually MAKE money month on month, year on year. Most of our clients come from Europe, Asia, and the Asia-Pacific Region. Most of our volume comes from European-based traders, however, this can and most likely will change over time. Those volumes, which fluctuate month to month, as we have clients that are seasonal and some who tend to trade more during volatile markets, have and continue to grow quarter after quarter.
Anything else you want traders or partners to know about FXPIG?
Bigger does not mean better. We have been here going on 6 years we truly are unique, and while other brokers may claim to offer their clients the same level of dedication we do, they don’t. I used to be a bit timid about telling it like it is, but honestly, with so much BS floating around this industry I think it’s refreshing to hear some straight forward talk… even if it is delivered by a bunch of PIGS…