NFA Compliance Rule

NFA Compliance Rule 2-43b
The Forex industry in the US has implemented a rule in 2009 through its organization for regulation called “National Futures Association”. It deals with regulating US Forex firms. The rule 2-43b bans hedging in a way that it requires the positions of pairs of the same currency offsetting to be dealt on the basis first-in, first-out or short: FIFO.
This very same rule bans adjusting the price to executed orders made by customer. However, it has one exception and that is when resolving a complaint. The rule says that the complaint needs to be resolved in the favor of the customer. Also, the exception is when there are transactions processing straight-through. That is when NFA needs to review the changes, document them and approve.

Those who speak in favor of the rule argue that it makes trading more transparent for customer. Also, they say, it gets forex trading closer to markets of futures and equities. When this change was implemented, forex companies had to make further changes regarding their platforms as the older versions of software made possible for users to select which orders for closing out. The new rule doesn’t ban closing out orders, it’s only the case that it is being done differently. There was one way to skip this rule, and traders could do it by moving account to another company in a country where those rules are not as in the USA.