FXIFY’s Prohibited Strategies

To become an FXIFY Funded customer, you must pass one of our evaluation challenges. When engaging in your trading challenge it is important that you use legitimate and well managed strategies. There are some strategies that FXIFY prohibits when trading on a challenge or a funded account. If you use these strategies on an FXIFY account, you run the risk of losing your account and being terminated from trading with FXIFY. Please see below for more information on the strategies:

High Frequency Trading

High-Frequency Trading (HFT) refers to the use of advanced computer algorithms and high-speed telecommunications networks to execute large numbers of trades in fractions of a second.

HFT is prohibited by FXIFY as it leads to market manipulation, unfair advantages, and can cause instability in the market. Any customer found to be engaging in HFT is breaching the FXIFY’s Terms and Conditions and therefore will lose the ability to trade on our platform.

All customers are expected to use our platform fairly and honestly and to comply with all laws, regulations, and the FXIFY’s Terms and Conditions.

Reverse Hedging

What is Reverse Hedging?

Reverse hedging refers to a trading strategy where a customer places offsetting positions across accounts within the same firm to minimise or negate risks. This practice is used to exploit the rules or limitations of FXIFY’s Terms and conditions by artificially reducing exposure to market risk.

Example of Reverse Hedging:

A customer opens a long position on one account and simultaneously opens a short position of equal size on a second account. This neutralises market exposure but artificially keeps both accounts active without risk, violating the firm’s guidelines for genuine trading practices.

Group Hedging

What is Group Hedging?

Group hedging occurs when multiple customers collaborate to place offsetting trades in different accounts within the same firm, with the goal of minimising overall risk while still appearing to actively trade. This tactic is often used to circumvent the FXIFY’s risk management rules by spreading risk across multiple accounts within a coordinated group.

Example of Group Hedging:

Two or more customers collaborate by placing opposing trades in different accounts, one customer opens a long position while the other opens a short position of the same size. This strategy neutralises market risk across the group but allows each customer to present themselves as engaging in legitimate trading, violating the firm’s risk management and fairness guidelines. 

Account management

At FXIFY, all trading activity must be done by the individual that has registered with FXIFY. Having someone else trade for you, or doing someone else’s trading on their behalf is account management. FXIFY is looking for real customers with real strategies. Account management is strictly prohibited at FXIFY.  We do not allow “pass your challenge” services or other similar services. This approach often bypasses FXIFY’s Terms and conditions, which require that each customer manages only their own account and trades independently.

Example of Account Management:

A customer secretly manages multiple accounts under different names, executing trades on behalf of other individuals. By doing this, the customer hides their true performance and risks, while attempting to game the firm’s system by spreading risk or testing multiple strategies simultaneously, which violates the firm’s one-account-per-customer rule.

Latency Arbitrage

What is Latency Arbitrage?

Latency arbitrage involves exploiting the delay (or “Latency”) between price updates from different data sources or trading platforms. Customers using EA’s for this method take advantage of faster data feeds to place trades on our platform where prices have not yet been updated, profiting from the price difference before our platform catches up.

Why is Latency Arbitrage Prohibited?

Unfair Advantage: Latency arbitrage takes advantage of the time lag between data feeds, giving customers an unfair edge over the platform and other users. In a simulated trading environment, this distorts trading performance and does not reflect true market conditions.

Distorted Results: The profit generated from latency arbitrage is artificial, based solely on exploiting technological gaps rather than legitimate trading strategies. This undermines the integrity of the evaluation process for FXIFY, where FXIFY aims to assess a customer’s skills in real market conditions.

Use of a Delayed Data Feed: The use of a delayed data feed in day trading refers to the practice of using a data feed that has a delay or lag in the delivery of market data, such as stock prices or trading volumes, giving an unfair advantage to the customer over other customers who are required to use real-time market data.

Trading on Delayed Charts: Trading on delayed charts refers to the practice of using charts or other graphical representations of market data that have a delay or lag in their updates.

Order book spamming

Order book spamming is a tactic some customers use in financial markets where they flood the order book with a large number of fake buy or sell orders. These orders are usually placed far away from the current market price and aren’t intended to be executed. The goal is to create the illusion of high demand or supply, which can mislead other customers into making decisions based on this false information.

Herd trading

Herd trading is the concept of many people trading in the same direction at the same time. This can be considered close to collusion between users and is prohibited by FXIFY. All trading activities must be conducted solely by the individual account holder, without influence or coordination from third parties or groups. Herd trading often involves customers blindly placing trades with no thought or strategy, simply because that is what others do. There is no risk management or strategy behind this so FXIFY isn’t looking for those kinds of customers. This also includes when customers use the same EA from the same company, this would lead to multiple customers collaborating at the same time. 

Collusion Between Users

Collusion between users is a serious infraction of FXIFY’s policy. Strategies like Herd Trading and Account management fall under collusion between users. If users intentionally open multiple accounts and place trades in the same direction, at the same time, on the same asset, this can be considered market manipulation and collusion between users. 

Poor Money Management

Customers who frequently encounter margin calls due to inadequate funds or risky positions may indicate a lack of risk management, posing a threat to their accounts and potentially the firm’s stability.

Improper Risk Management

Gambling behaviour

This type of strategy often relies on emotions driving decisions rather than reason. This can range from chasing continuous wins or losses, impulsive trading, or even addictive behaviour. YOLO strategies, which involve taking high-risk positions in hopes of extreme rewards, are particularly dangerous. These approaches often neglect sound risk management and are more driven by the thrill of potential gains than long-term profitability. Such strategies can lead to significant losses and undermine the sustainability of one’s trading performance. For the integrity of our customers and the sustainability of our programs, we don’t condone these types of strategies, these types of behaviours are prohibited on our platform. 

Behavioural patterns

Behavioural patterns are not necessarily prohibited by FXIFY but can be an indication of a prohibited strategy being used. For example, trading during non-liquid market hours with the intention of exploiting liquidity shortages, or continuously trading around news. 

Exploiting bugs and glitches

Exploiting any bugs and or glitches on any trading platform is prohibited by FXIFY and will result in your account being terminated. This includes but is not limited to, bugs and glitches relating to the FXIFY site, any of the trading platforms and brokerage feeds. This also includes arbitrage trading. 

High leverage news trading

What is High Leverage News Trading?

HLNT: High leverage news trading involves placing large, leveraged positions just before or during major economic news releases to capitalise on sudden, volatile price movements. Customers use the increased leverage to maximise profits from the sharp swings in the market that occur immediately after a news announcement. HLNT is essentially betting on coin flips and is no different from regular gambling. 

FXIFY allows HLNT within limits. It must be clear to FXIFY that proper risk management tactics are being used when engaging with HLNT. As mentioned, if it appears the customers is gambling with no thought, this could result in the account with FXIFY being terminated.

Statistical Arbitrage

What is Statistical Arbitrage? 

Statistical Arbitrage is when a customer  deploys a large number of high-risk trades while aiming for one significant win to cover losses from failed challenge accounts. The customer  relies on statistical models to predict that one or more trades will generate a significant profit, offsetting any previous losses incurred. However, deploying a large number of high risk trades over multiple accounts in this manner is not considered a long-term, profitable, or sustainable approach. This practice is in direct conflict with our values and terms and conditions. At FXIFY, we reserve the right to discontinue cooperation with clients who intentionally open multiple accounts and engage in these strategies, hoping for favourable market movements.

• FXIFY holds the right to enforce strict consequences in the event of policy violation:
• FXIFY reserves the right to terminate agreements immediately in the event of any breach by the customer .
• Profits generated from prohibited trading practices will be void.
• All passed Evaluations are subject to review, and customers found guilty of policy ignorance or abuse will not advance to the Qualified phase.

These descriptions should be read in conjunction to clause 5.4 of the Term and Conditions of FIXIFY any customer which will be found to engage in Forbidden Trading Practices puts their account(s) at immediate risk of, by way of termination of all services provided by FIXIFY to the customer and subsequently closing the account(s).

These answers were prepared in order for FXIFY to enhance our commitment to ensuring that trading activities within our platform adhere to best standards and responsible trading practices.

If you have any further questions, please contact [email protected].