Broker Challenge quotNDD/STPquot vs. True quotECNquot and quotMkt Mkrquot broker talk - Page 3
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Thread: Broker Challenge quotNDD/STPquot vs. True quotECNquot and quotMkt Mkrquot broker talk

  1. #21
    [quote=;4439948]Well, you have to develope your effective egy that is tailored to your trading style, your trading timeframe and goals. Everybody is different. There is no egies that is 1 size fits all.

    Thank you for ur effort.
    I am doing and will do more and more.

  2. #22
    Quote Originally Posted by ;
    It may not have been the 20M net cap, but the timing of this sale/closure was appropriate in line with the net cap requirement. It was purely coincidental, or to a extent. Though true, a company like theirs would have have little problem submitting it (heck, Advanced Markets posts it, and they had all 58 total US customers http://forexmagnates.com/us-forex-br...q4-2010-final/. .)

    The money in retail can be quite good, and they were implementing fine (lower rates than MBT). Hard to say if it...
    Yeah the FXCM deal is a plausible reason particularly if HotSpot has ever been eyeing to step to the real interbank market and eventually with what FXCM offered them, they are finally climbing in the Big League and rubbing shoulders with all the big players.

    Still sucked for us to shed them thou. That, for sure.

  3. #23
    Quote Originally Posted by ;
    STP is supposed to imply that your order goes from
    you trader X to counter-party Y and the broker is only facilitating a way to place the trade. However, this is not so. (at least in my study )
    what's happening is this:
    Trader X orders buy EUR/USD - Broker areas trade sell EUR/USD together with market. -- Now, what should the broker thinks this transaction might be better accepted by them at a slightly better price, state 5 pips away from trader x's entry?

    .
    I'm slightly mixed on the benefit of broker's doing counter trade.

    If the euro interest rate is 1.00%, and the U.S. rate is 0.25percent

    TraderX would earn interest 0.75percent while long eur/usd from broker, and meantime broker must pay attention 0.75percent to it is LP while short eur/usd, so totally broker must pay 1.5percent outside.

    Cheers

  4. #24
    Quote Originally Posted by ;
    The assert as I know it is as follows:
    Trader X unlocks platform to do order of Ask(long) one lot EUR/USD (Buy EUR sell USD) this order is then routed to the ndd brokers host,
    Next, the broker is supposed to immediately create its own order with it's liquidity suppliers (whoever will fill at best price available) for your counter commerce
    (Sell EUR buy USD) then claiming that only if the offset trade is implemented will your first commerce be acceptedX
    it's very strange if brokers do counter commerce at it's LP.

    Say eur/usd 10 vs 13 on broker platform, 11 vs 12 on LP platform

    customers long = paid 13 usd
    brokers brief = gained 11 usd

    currently market up to 20 vs 23 on broker platform, 21 vs 22 on LP platform

    customers close long = make 20 usd
    brokers close brief = paid 22 usd

    customers earned seven usd which is paid by brokers too.
    Brokers paid 11 usd to LP, so totally brokers paid 18 usd
    what a company model??

  5. #25
    I guess it may be the MM's B book model, maybe not NDD or STP.

  6. #26
    Terms are in SPECIFIC order to get a reason. After the definitions are read, (I WELCOME any improvement or correction) You will likely know MY aforementioned issue.

    MM: Market Maker - (W/ dealing desk) In FX that really is a broker that will take numerous prices from different liquidity providers and decide which combination MOST SUITS THEM, NEXT they will include a pip or 4 into the spread and then move it along to YOU the retail FX trader. In turn they've Just MADE a Market.
    When you place a trade LARGE or small - it is routed to the dealing desk if not instantly counter-positioned with a black box and figured out afterwards. What is afterwards? Later is if the Dealing desk that has taken the opposing side to your commerce gets around to viewing if you're a threat to their bottom line. If you are and have somehow edged through. 2 things may happen;

    1. They actually do cancel the risk by putting your transaction (through their name- onto the Interbank market to reduce risk and protect their web exposure)
    OR
    2. That they DO - CAN and will get your IP address/ (given, acct #) and can slow down your executions. -- Should not completely block or freeze or RE-quote your account until you are in a losing trade. STOP HUNTING is known as a SPORT in London. LOL I would say NY as well. Tons of bucket shop.
    Stops aren't hunted in the meaning many may think either - by widening spreads just to take one out. A retail broker is not going to get rich by taking a few mini lots from you. How it works as I know is this. Brokers know where your stops are. You have in fact told themso there is no secret. When a high number of stops collect in a clear place, say 5 / 10 pips below recent swing low. A market maker can go onto the real FX market and place a large enough order to move the price back down at a less volatile moment. Essentially wiping out a nice amount of stops before exiting, next the price continues on it's travel backing and completing all the while.

    3. MMs offer ridiculously low opening account balances. This is the start of the end for many retail traders.
    A. Get new money in / that they will shed. B they'll return more aggressively and shed quicker on emotion.
    4. Market Makers have coping desks, see #1 - this is exactly what they do and your commerce never goes any further than their decision.
    5. Scalping is futile, the spreads are excessively large, and the implementation is lousy at best.
    6. I can assure you - there are maybe 1% of retail traders really earning real money (enough to live off comfortably) trading with a market maker.
    -- if I'm wrong on 6 - please prove to me personally . Lt;--



    NDD: NO Dealing Desk / STP: Straight Through Processing</b>
    :
    Here is where the dilemma arises - This really is one of the main functions of my writing and I'll be passing this query along to a commercial member on the board representing a previous market maker now turned NDD/STP.

    OK so - NDD/STP - 2 kind of redundant, yet different, and somewhat contradictory terms.
    The No Dealing Desk version, asserts exactly that - the orders aren't immediately taken from the deal desk at the opposite side of the trade. ( ie: I market EUR/USD deal desk buys)

    The claim since I am aware that it is as follows:
    Trader X unlocks platform to do order of Ask(long) one lot EUR/USD (Buy EUR market USD) this order is then sent into the ndd brokers host,
    Next, the broker will immediately create its order with it's liquidity providers (whoever will fill at best price available) for your counter trade
    (Sell EUR buy USD) then claiming that only if the counter trade is executed will your initial trade be accepted. In volatile situations that is all happening tick by tick to a pair such as EUR/USD, from 10's of 1000s of traders worldwide.

    Ultimately it is stated that since the broker is only filling the order to trader x if the counter is implemented, they've effectively eliminated the conflict of interest a deal desk has with trader x - due to the promise that they aren't taking the opposing side of the trade, rather passing it through.

    Now I begin to have difficulties.
    How is that STP? I still have a position with the market maker rather than a bank or another trader. STP is supposed to imply that your order goes from
    you trader X into counter-party Y and the broker is only facilitating a means to set the trade. However, this is not so. (at least in my research)
    What is happening is this:
    Trader X orders buy EUR/USD - Broker areas exchange sell EUR/USD together with market. -- But what if the broker believes this transaction might be better accepted by these at a slightly better price, say 5 pips away from trader x's entry?


    ECN: Electronic Communiions Network - That as a specified needs to be NDD and STP.


    Just laying the frame in case this thread survives - obtained liberally run for a bit. back later.
    X

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