Series 34 case studies
Series 34 · Put your knowledge to work in context.
The Series 34 - Retail Off-Exchange Forex Examination is a qualification exam for individuals who solicit, or who supervise others who solicit, retail off-exchange foreign currency (forex) business from customers. It is most relevant to associated persons at firms offering retail forex accounts, and to the supervisors and compliance staff responsible for that activity. The Series 34 case studies are 5 cases and about 4,083 words.
1The Carry Trade That Wasn't: P&L, Cross Rates, and Puffery
Renata has a 100,000 account at a forex dealer member and tells her associated person (AP) she wants to profit from "the interest rate gap" between the dollar and the euro. On March 3 she buys 500,000 EUR/USD; the dealer quotes 1.0848/1.0852 and she is filled at 1.0852.
823 words, about 4 min2The Margin Call the AP Promised to Absorb
A customer with $150,000 of equity opens three positions at one dealer on a single morning: long 1,000,000 EUR/USD filled at 1.1000; short 1,000,000 USD/JPY at 145.00; and long 1,000,000 USD/ZAR at 18.00. The dealer collects the regulatory minimum security deposit on each position and marks the account to market continuously.
736 words, about 4 min3Offshore License, 400:1 Leverage, and No Signed Disclosure
FX Meridian is an unregistered Miami company. Its website, aimed at U.S.
798 words, about 4 min4The Marketing Package Nobody Wanted to Read
Golden Gate FX's top associated person, Priya, submits a marketing package for approval: (1) an Instagram carousel stating "Our clients won 82% of trades last quarter"; (2) a webinar slide reading "Capital protection - we refund first-month losses up to 5,000"; (3) a video testimonial in which a customer says, "I turned 10,000 into $60,000 in six weeks"; (4) a chart labeled "results" that is actually a backtest on 2019-2021 data, with no explanation; (5) "Lock in 50:1 before regulators take it away." Her branch manager says, "Approve it - everyone posts this." Priya also runs a personal TikTok account, linked from her firm bio, where she posts trade ideas and a referral code. She wants sign-off by Friday so the campaign can launch Monday.
843 words, about 4 min5Four Problems on the Dealing Desk in One Week
A compliance review at a forex dealer member turns up four items in one week. (1) Fill data show average slippage of 0.2 pips when a market order moves in the customer's favor and 2.8 pips when it moves against.
883 words, about 4 min