Where does the money go in Forex

When you transfer money to a forex broker, you think it goes to the real market. In most cases for a retail client, it doesn't. Let's explore where your money actually goes.

Model 1: Market Maker (B-book)

This is the most common model for retail forex brokers.

How it works:

• You open a 'buy EUR/USD' trade.
• The broker does not execute the trade on the real market.
• The broker itself becomes your counterparty.
• If you lose, the broker gains.
• If you gain, the broker loses.

Why this is a problem: The broker is interested in you losing. A conflict of interest is built into the model.

Model 2: ECN / STP (A-book)

How it works:

• The broker executes the trade on the real market.
• Earns through commission (not through your losses).
• Interests align.

Model 3: PAMM accounts

How it works:

• You give money to a 'manager'.
• He trades with it.
• You receive a percentage of the profit (or incur losses).

Why it's risky:

• The manager is not liable for the losses.
• No licensing.
• No oversight of actions.
• In Tajikistan, PAMM accounts are not regulated by the Ministry of Finance of the Republic of Tajikistan.

What about the stock market?

When you buy an Apple stock through a licensed broker:

• The money goes towards purchasing a real stock on the NYSE/NASDAQ exchange.
• The stock is kept in a depository.
• You are a real owner of a share in the company.
• The broker earns through commission (0.3%), not from your losses.

What to do

If you're offered forex or PAMM, ask:

1. Where is the company registered?
2. Is there a license from the Ministry of Finance of the Republic of Tajikistan?
3. Where does my money go - to the real market or to the B-book?
4. Where are my assets stored?

If the answers are evasive - red flag.

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💡 Try: opening an account with a licensed broker in Tajikistan can be done in a few minutes. Funding from 100 somoni, without visiting an office.

Advertisement. LLC 'Stock Broker', licenses from the Ministry of Finance of the Republic of Tajikistan No. 007/25, No. 008/25, No. 009/25, No. 010/25 dated 25.06.2025. Financial instruments are associated with risk. Profitability depends on the market value of assets. Not an individual investment recommendation. The material is for informational purposes only.