The Offer
- TastyFX (a forex trading platform, formerly called IG Trading) is offering up to a $10,000 bonus when you open a new account.
- $250 funding, get $5 per lot
- $1,000 funding, get $8 per lot
- $5,000 funding, get $10 per lot
The Fine Print
- Note: pairs ZAR/JPY SEK/JPY NOK/SEK NOK/JPY MXN/JPY TRY/JPY PLN/JPY CNH/JPY excluded
Our Verdict
Too much effort/risk involved for me, so will pass.
Hat tip to Carlzjr
“Trades can be made in any lot size increment; provided that, for the purposes of this Promotion, the notional value of one (1) lot of the forex pair is not less than $25,000. For example, one (1) lot of EUR/USD will have 100,000 units of EUR/ USD that equates to approximately $110,000 in notional value if the forex pair price is 1.1000.”
At their best spread, 0.8 pips, and notional lot value of 25k USD, you would lose .8*1/100*1/100*25000 = $2 = net $8. The thing is you’re risking them voiding the bonus for whatever stupid reason. And that optimal trading pair probably doesn’t exist.
“The account will not qualify for a Bonus if your account is closed or restricted for any reason prior to a Bonus being funded into the account. “
Had to look up a lot. It’s 100k currency units. So your trades will be leveraged if you deposit less than that (which I believe is the norm in fx). Wonder what the tax implications of making 1000 buy sell trades would be. Would I be getting killed on the spread or something?
The bid-ask spreads pretty much ensure that you’re going to be in hole at the get-go. Tasty is probably smarter than Oanda, the way they have effectively structured the bonus on a per-trade basis, versus minimum accumulated trading volume. Pass.
They are netted at the end so you indicate your total gain or loss. You can choose either Section 988 or Section 1256 treatment, Section 988 you deduct losses or report gains as ordinary income, 1256 you use the 60/40 short/long term treatment but are limited to capital losses offsetting $3,000 of ordinary income. https://greentradertax.com/a-case-for-retail-forex-traders-using-section-1256g/
Additionally they only count opening transactions for purposes of counting lots so a buy then a closing sell is only one lot
100k currency which have to be worth more than $25k total as well