Lynx Review/Test (05/2018) | Trustworthy or a scam?

LYNX experience 2018
LYNX, headquartered in Amsterdam, was founded in 2006 and acts as an Introducing Broker for Interactive Brokers (UK,) the European subsidiary of one of the world’s largest brokerage houses headquartered in the United States. Through LYNX’s platforms, investors can trade stocks, ETFs, bonds, options, futures, CFDs, warrants, certificates, funds, and currencies (Forex.) There are more than 100 cash and derivatives exchanges from Europe, America, Asia, and Australia.

Trading takes place via the trading platform TraderWorkStation, which is very rich in features, or alternatively via the simplified platform LYNX Basic. The pricing is based on an Anglo-Saxon fee model for trading on US stock exchanges at a price of $ 0.01 per share with a minimum fee of $5.00. Also, the order fees in futures trading are $2.00 per contract, which is lower than most competitors. CFD trading is based on a DMA model.

The facts at a glance
Regulation: AFM (Netherlands), FCA (UK) for Interactive Brokers
The minimum deposit is $4,000
No custody account fee
Regular webinars on specialist topics and current market events
LYNX provides apps to its customers
Broker name: Lynx broker
Visit website: https://www.lynxbroker.com
Established in 2006
Headquartered in Netherlands
Regulated by AFM
Deposit Insurance $500,000 per customer
CFD trading: Yes
Other financial instruments: ETFs, futures, warrants, options, certificates
Trading platforms: Trader Workstation, Lynx Basic, Apps for Smartphone and Tablet
Continuing webinars and numerous information
Support phone, chat, e-mail
Languages Belgian, French, Polish, English, and more…

Our LYNX review in detail
Among the most important aspects of the LYNX test are the order fees in trading.

Order Fees USA: 0.01 USD/share, min. $5.00 and max. 1.25%
Spreads CFD trading: Market + Commission (DMA trading)

Market model, spreads, and commissions in CFD/FX trading
CFD trading is based on a DMA market model. For those traders who experience the first time with a CFD broker such as LYNX and do not know the difference between DMA and market making, the advantage of “Direct Market Access” is briefly outlined below:

DMA brokers settle contracts for differences on the prices of the regulated stock exchanges. In the case of LYNX traders place their CFD order in the order book of the stock exchange and can understand the execution and the price in detail. The broker creates a CFD between himself and the client after executing the order in his own name. This provides complete transparency with regard to the settlement rates.

By contrast, market makers themselves set buying and selling prices and “match” their clients’ orders. Overhanging net positions can arise in one direction or the other. Whether this “exposure” is neutralized by hedging is often not visible from the outside. In the worst case, market makers earn losses from their customers – a tangible conflict of interest. Another disadvantage of market making is the transparency of the settlement prices: it is difficult to understand whether the spread was appropriate in individual cases or not.
Like all DMA brokers, LYNX charges trading fees for CFDs, as unlike market-making, LYNX does not charge any fees in spreads.

Trading platform
The fact that LYNX often performs well in the review by specialist magazines is not least due to the trading platform, The TraderWorkStation (TWS); it offers a very large range of functions. The platform is free and requires a download.

The scope of services of the TWS includes more than 50 order types and order additions, more than 70 technical indicators, fundamentals and balance sheet information, profiles and key figures, professional trading tools, the consultation of historical price information as well as insight into the order book including time & sales. Of particular importance are several modules designed to meet different investor types.

Apps for mobile trading
The broker has developed an application for mobile access to the trading account. The LYNX app is available for Android and Apple operating systems and is free. Through the app, users can trade stocks, futures, and CFDs at all stock exchanges tied to the deposit. The mobile features include a direct depot overview, real-time courses with charting and market scanner tool, execution reports, and performance reports.
LYNX Basic is an additional trading platform as an alternative to TWS. The broker views the web-based software as suitable for trading in equities, ETFs, options, option combinations (eg straddle) and CFDs, and recommends the platform to newbies and occasional investors. These could develop in the context of an “evolution” to a professional who needs all the functions of the TWS.

LYNX Basic offers a performance analysis compared to the TWS. In return, users will have to relinquish Level II market depth, professional trading tools, demo accounts, and the ability to exercise options.

Developing a TWS alternative is a strategically smart move by the broker. The TWS is likely to put off beginners with the countless modules and features rather than attract. Thanks to the web-based Basic platform, even newbies without previous knowledge can experience LYNX without having to be overwhelmed by too many functions.

Account opening, bonus and new customer actions
The account management is free of charge. In the price list, however, there is an indication of an inactivity fee of $1.00 per month. This is calculated in all months in which the account balance falls below $1,000 AND in which no activity takes place. From the perspective of some online traders, the minimum initial payment of $4,000 (or the equivalent in another currency) is a weak point or exclusion criterion in the LYNX test. A counter-speech to the gladly raised demand for the waiver of minimum deposits is allowed at this point: It is not necessarily in the interest of actively acting customers, if a substantial part of the resources is bound by experiment-eager beginners with a narrow financial basis.

New customers must choose between a cash deposit and a margin deposit in the account opening application. The Bar Depot does not allow short selling, margin trading, or trading in CFDs and futures contracts. In addition, it may take up to three days for the proceeds from securities sold to be credited, which may make day-trading more difficult. The necessary identity check is carried out by means of a standard procedure.

How reputable is LYNX?
LYNX acts as Interactive Broker for Interactive Brokers (UK). This means that all orders are executed via the Interactive platforms and the account and securities account management is carried out there. LYNX’s status is comparable to that of an intermediary who advertises customers and receives commission for each transaction. However, this does not mean that opening a direct account with Interactive Brokers would be more cost-effective for end users: outsourcing much of the distribution is strategy and is reflected in the pricing policy. LYNX was founded in 2006 and is active in several European countries.

The Introducing Brokerage Agreement is with Interactive Brokers (UK) Limited. It is a subsidiary of Interactive Brokers Group LLC based in Greenwich, Connecticut, USA. The broker was founded in 1977 by today’s chairman. The shares of the company are listed on the NASDAQ. The rating agency Standard & Poor’s rates the company with an investment grade.

According to the company, the Interactive Brokers Group and its affiliates conduct approximately one million transactions per day. In total, the group employs around 1000 people. In addition to its headquarters in Greenwich (USA,) it maintains locations in Switzerland, Canada, Hong Kong, UK, China, and few other countries.
LYNX itself employs more than 100 people and according to its own account has so far opened more than 40,000 accounts.

Research, analysis, and training at LYNX
In the dedicated area of “Knowledge,” LYNX provides customers (and in some cases interested parties without an online stock portfolio) with daily market commentary and analyzes as well as various editorial contributions. Significant developments in technical charting that could, in the near future, give rise to trading signals in one direction or the other according to the rules of technical analysis.

In addition, the broker regularly organizes webinars on specialist topics and current market events. The events, known as “masterclasses,” can be viewed as live webinars and recordings, and are organized into analysis, derivatives, trading platform, and strategy & tactics.

What about customer service?
The customer service can be reached via e-mail, chat, and telephone. In addition, there is the possibility of remote maintenance. Customers grant access to their own computer to a customer service representative. In the course of such sessions, for example, bugs in installing the trading platform can be fixed or steps to their use can be quickly illustrated. The option of remote maintenance is a plus point for the LYNX rating.

Is automated trading available?
No – and this is a drawback for the LYNX valuation for a considerable part of the target group and therefore only partially comprehensible. Anyone interested in the development or use of algorithmic trading systems is in the wrong place…

Can a demo account be requested?
Yes. Upon request, the LYNX demo account will be activated for a limited period of about two weeks and will be equipped with virtual start-up capital.
Anyone who experiences for the first time with a (ultimately) British broker such as LYNX, is well advised to do a demo account comparison.

Is there a referral program?
Yes. Anyone who can bring friends and acquaintances to their site to open an account will receive a credit of $50.00. Condition for the payment of the premium are at least three transactions of the recruited person in the first three months after opening the account.

Lynx enables customers to trade via one of the world’s largest brokers: Interactive Brokers UK handles large trading volumes and has been active in the market for decades. More importantly, the broker allows trading on a very large number of cash and derivatives exchanges and, in addition, trades CFDs via a transparent market model.
This range of services is usually not found at other brokers.

Interactive Brokers does not pay any withholding tax. Investors therefore have to declare and tax their income themselves. The tax burden incurred in this case at a later date results in a liquidity advantage. Traders who experience for the first time with a foreign broker such as LYNX should take this into account.

Since the broker has been active since 2006 and differs significantly from the majority of competitors in some respects, there are numerous LYNX opinions, reviews, and ratings of the broker in relevant specialist media. In 2015, LYNX took third place in the Broker Choice category in the Futures Broker of the Year category. For the election, customers are asked by brokers to vote – the more votes for a broker, the better their ranking.

PRO arguments
Regulation by the AFM and FCA
No custody account fee
About 100 cash and derivatives exchanges
CFD offer (DMA trading)
Apps available

CON arguments
Minimum deposit requirement is out of reach for many small traders

Final Rating: 7.8/10

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