Global Prime – Review

globalprime.com briefly

Global Prime is authorized to deal in securities, derivatives, and foreign exchange contracts, as well as provide general and personal advice to retail and wholesale clients. It is regulated by several authorities including Australian Securities and Investments Commission (ASIC). Customers can trade currency pairs, indices, and commodities through one of the world’s most widely used trading terminals – MetaTrader 4 (MT4) with floating spreads. Global Prime uses the Straight Through Processing (STP) model to execute orders, claiming it is an ECN, STP, NDD brokerage company. Global Prime generates money from commissions (USD7 for forex and metals), spreads, and swaps and it does not make money from client’s losses, eliminating the main conflict of interest. You can start trading with AUD200.

Regulation

It is essential to know if and where a financial company is regulated. The globalprime.com website is operated by three entities, each regulated by a different authority in different countries. Global Prime Pty Ltd is authorized and regulated in Australia by the Australian Securities and Investments Commission (ASIC) under license number 385620; Gleneagle Securities PTY Limited, trading as Global Prime FX, is registered in Vanuatu and is regulated by the VFSC under register number 40256; Global Prime FX Ltd holds a Securities Dealers License SD0857 issued by the FSA Seychelles. All client money is managed in accordance with client money laws and kept separate from company funds. Client money is held in segregated Client Trust Accounts with Westpac bank, the company says

Account Types

There is only one type of live account called Global Prime ECN Account and trading conditions are equal for all categories of traders. The minimum required deposit is AUD200 and spreads start from 0 pips. The leverage can be up to 1:200. The minimum trade size is 0.01 lots, and the maximum trade size is 1,000 lots. The order execution model is ECN/STP/NDD. You can trade 48 currency pairs, 20 commodities and 14 indices. A commission of 7 USD will be charged for a completed transaction.

Market Maker or STP Brokerage?

Although the company claims it uses the STP model to execute client’s orders, the Product Disclosure Statement (PDS) document shows that Global Prime enters into transactions with clients as a principal. It is a market maker, not a broker. The company will always act as a principal, not as an agent, for its own benefit. The company explains in detail how it makes money. It states that Global Prime is an ECN, STP and NDD broker. However, the PDS claims the opposite. It is also written that Global Prime generally makes its money from commissions, spreads, and swaps. Global Prime claims it does not profit from client losses, except for the small amount orders when standing against the client. It also says that it does not itself seek to make a market or speculate and Global Prime’s Hedge Counterparty, Gleneagle Securities, usually takes the other side of the transaction. In other words, Global Prime acts as principal hedging the most part of client orders to Gleneagle Securities. Legally, the company is a market maker and counterparty to all client orders. Being a market maker involves a conflict of interest regardless of the company’s claims.

The same document reveals that stop loss orders are not guaranteed and they may not be executed at all or the execution of the stop loss order is subject to market volatility and slippage. Stop-loss Orders may not always be filled and, even if placed, may not limit your losses to the amount specified in the order, since they are not guarantees that there will be no loss, the text warns.

The same file warns that your potential losses on dealing in Global Prime products may exceed the amounts you pay (as Margin) for your Global Prime products. Your potential losses may be unlimited. It is also written that a client’s liability in respect of margin requirement and margin calls is not limited to the amount, if any, initially paid to Global Prime. This means there is no negative balance protection, and in the end, you may owe money to this company.

Fees

There is no inactivity fee, so you can determine the time frame in which you want to trade. Of course, there are common fees such as spread, swap and rollover.

Deposits and Withdrawals

Deposits can be made by bank transfer, credit/debit cards, and e-wallets such as Neteller, Skrill, etc. Some methods are instant such as Neteller and Skrill, while bank transfers usually take longer depending on the bank as well as the intermediary bank (up to 5 business days). The company claims it covers the merchant fees for Neteller and Credit Card deposits. 

Withdrawals can also be made by bank transfer, credit/debit cards and e-wallets such as Skrill, Neteller. Withdrawals usually take a couple of business days. Bank withdrawals can only be returned to a bank account in the same as your Global Prime account.

Only the initial deposit amount can be returned to the credit card. Amounts above this will be returned via bank wire.

Inactive accounts deposited via Neteller or credit card will be charged a merchant fee when withdrawing funds.

The minimum required deposit amount is AUD200.

Trading Platforms

You can trade via one of the most popular trading terminals worldwide – MetaTrader 4 (MT4). The interface is customizable and can be used on personal computers, smartphones, and tablets. With MT4 you can create automated trading operations, develop, test, and improve automated trading strategies. You can use 30 technical indicators and 31 graphical objects for your technical analysis. MT4 offers automated trading through the so-called Expert Advisors (EAs). This is an automated trading software, which places, modifies, and closes positions.

Assets

Forex – 48 major, minor, and exotic currency pairs can be traded. The average spread for the EUR/USD pair is around 0.1 pips. The liquidity comes from 3 prime brokers and over 20 liquidity providers. The leverage can be up to 1:200.

Indices – You can trade 10 futures of the most popular major and minor indices globally, such as DJIA, DAX, and FTSE100. The average spread for DAX30 is 0.7 points and for DJIA it is 1.7 points.

Commodities – 6 precious metals (Gold, Platinum, Silver, etc.), 3 energies (WTI Crude Oil, Brent Oil and Natural Gas) and 11 agricultural commodities. The average spread for Gold is USD0.13 and for Crude Oil it is USD0.016.

Insights Section

There is a special section called Insights, which covers daily analysis, videos, and guides for trading.

Summary

Global Prime has an ASIC regulation but there are two more company involved in operating the website, so be careful which one you will deal with. Although it claims that it uses the STP model to execute orders, the company is a market maker, and the main conflict of interest exists. However, Global Prime claims to hedge most of the customer orders but the main counterparty is another company from the group – Gleneagle Securities, which is regulated in Vanuatu. The company provides three asset classes for trading via the popular terminal MT4. There is only one type of real account, which the company claims to be ECN, STP, NDD. You can start with as low as AUD200. You will be charged a commission of USD7 for a completed trade.