About Forex brokers
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More and more often brokers talk about the technical component of their order execution, in which liquidity aggregators play an important role. What are they, what are their differences, and is it possible to set them up for slippage in favor of the broker, tells ForTrader.org magazine Quotix CEO Evgeny Sorokin. - What is a liquidity aggregator and what are its main functions? - Liquidity aggregators are the systems that integrate quotes from different sources into a single torrent and route the orders to liquidity providers. Brokers use aggregators to narrow the spread, get the best possible order execution and diversify risks associated with liquidity providers. Aggregators have many nuances of implementation, such as: Availability and...
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Due to the specifics of my work, I often communicate with the managers of various brokerage companies. There is probably no broker in Russia that is so popular that I do not have an opportunity to discuss the events in the industry with one way or another. So, lately the main issue worrying the companies became active and very frequent bankruptcies of the brokers, which were quite strong and did not cause distrust. Of course, this problem worries traders even more, who pay for it out of their own pockets several times a year. Our staff magazine traders have also left about 2500$ in companies that have already disappeared (acquaintances didn't help at all :)), so in my today's article I...
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Maximum reduction of trading costs is a natural desire of any participant of financial markets, and no wonder that for traders the size of spread is one of the most important factors when choosing a brokerage company, and for brokers it is a powerful competitive advantage and a lever of attracting clients. Following such logic one can suppose that the lower the level at which the broker will fix the spread for one or another financial instrument, the more profitable the trade of its clients will be. But in practice it is not always true. Moreover, most big brokerage companies offer along with low fixed spreads floating spreads, the size of which is not limited and not regulated anywhere. И...
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Beginning of the article Let's look at the EUR/USD tick chart of the largest liquidity provider, Swiss bank Ducascopy. BID and ASK charts are presented. Current time: 15:00 (MSK), 14.02.2015. The market is relatively calm: no news and no macroeconomic indicators are published during the hour. A 1000 ms wide window has been arbitrarily selected. There are 44 different values inside this window. If you move the window one step forward, the number of ticks will increase to 50. Let's assume that the trade server allows you to conduct operations with a delay of 500 ms (which is an excellent result). Attempting to sell at the initially stated price of 1.12770 could result in more than 35 retracements by the bank, before...
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In this article we will try to eliminate the uncertainty, which, in our opinion, can be purposefully maintained by some brokers to attract additional audience. The author expresses his personal vision, formed while working in a brokerage company, which adheres to different business principles. We will describe several practical methods you can use to critically analyze your broker's performance. In this article, we are intentionally not looking at introducing brokers (IBs) that operate under an open agency contract model. We are talking about companies that position themselves as clearing agents, conducting transactions on behalf of the company. Broker agent clearing model: transactions are broadcast to the interbank market This unconfirmed model is based on...
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Leverage is precisely the tool which transforms foreign exchange trading from an internal game of commercial and central banks into an activity available to the widest range of individuals. Thanks to an interest-free loan provided by a broker, traders' positions are brought to the necessary minimum and brought to the market, while the broker himself receives the right to charge spread and SWAP as payment for his services. Therefore, reasoning about the usefulness of leverage seems to be superfluous. It is known that margin trading has not only advantages, but also risks, and traders often lose deposits because they use too much leverage. In this case the credit provided, regardless of...
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January 2015 will be remembered by traders for a long time. It was a month that would absolutely turn the currency market industry upside down. One hour and one unexpected decision of a major financial and political player made speculators and brokers alike nervous; some traders were instantly made the king of the world and rich, while others were made losers and bankrupt. Both of them were enough for even the largest and most eminent brokers to declare the most serious losses multiple of 6-8 zeros in dollar equivalent. "Black Thursday" for brokers If you have been reading the text all this time surprised and missed the trading day of January 15, I remind you that in connection with the decision of the National...
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The beginning of a new year is a good time to take stock and make plans for the future. You are probably expecting something like this from me, reading the New Year's Eve blog. But this time I would like to surprise you and talk about... trade practices. And I got such thoughts from ongoing disputable situations in the branches with brokers' comments, where on one side are traders who try to earn on arbitrage, and on the other side brokers, who do not allow reaping huge dishonest profits by any means. Other articles on the topic Arbitrage systems - big and illegal profits on Arbitrage and fair Detail of arbitrage strategies...
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The vast majority of modern brokerage companies develop two lines of business simultaneously: the provision of intermediary services when bringing client transactions to the market and building an affiliate network. And the second does not take away the attention and strength from the main activity of the company, but on the contrary, allows to get even more prepared and interested clients without serious expenses on marketing, active sales or training. The articles of the master-class "The downside of trading" Locking: a hedging method, trick or just an irritating factor for the broker? Verification at the broker: the way to postpone the payment of profit or the protection of clients' investments? Bonuses from brokers: a real benefit or a trap? Company partners do all the work of attracting and motivating clients to deposit...
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In Russia, a stratum of active young people has formed who are focused on creating their own business. They are very familiar with the opportunities offered by the Internet and the Forex market in particular. In this article, we will look at different ways to start their own business on . Starting your own company On many forums you can come across messages from newcomers asking how they can start their own company. Looking ahead, we can say that the order of numbers will be very high, and without a major business investor to embark on this path is almost impossible. And, as practice shows, in the highly competitive brokerage market it is difficult for a newcomer to survive even with a large investment and competent management. To open a company...
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Bonus promotions from brokers and dealing centers have long been a common attribute of working on the market and are often decisive factors when choosing a company or determining the amount to be credited to a trading account. But very often received bonuses turn against the client and instead of increasing his profit only speed up the process of deposit's nullification. How to understand when bonus from broker is just a marketing tool and really can increase your trading efficiency, and when on the contrary - is the signal of the company's unfairness? Take a look at these articles! Locking: a hedging method, a trick or just an annoying factor for the broker? Verification at the broker: a way to postpone the payment of profits...
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Any person, who has taken a great interest in trading on Forex currency market, realizes that this activity is not very simple and it is necessary to receive theoretical knowledge to master it. The Internet is full of advertisements, where experienced traders offer everyone who wishes to learn the basics of currency trading for a certain fee. Brokers companies, on the contrary, offer free education for their clients, as they are interested in the growth of their client base and increase of commission income. How effective is paid Forex education? Let's weigh the pros and cons. training: where to find an experienced teacher? The main postulate, which puts forward the supporters of fee-based training - "good education is expensive. And it's hard to argue with this - a qualified specialist will not conduct training for a "thank you" ....
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Trading in ECN is a new wave of services offered by various companies, DCs and brokers. It has many different advantages for the trader, but sometimes there are hiccups associated with the execution of orders at a price that does not seem to be in the terminal. The reason is the snapshots of quotes. So, the quotes in ECN are snapshots. A snapshot is a slice of the market, quotes of the system at a certain moment of time. For example, the counterparty sends quotes 100 times per second, and the broker shows them only once per second. Many quotes that came from the counterparty between two snapshots do not get into the system....
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As you know, the Islamic world lives according to its laws and principles, which every Muslim is obliged to sacredly observe and honor. Not to mention the everyday and religious life of believers, the prohibitions of Sharia, known as "Haram," also make adjustments in the economic sphere of life. Economic Restrictions in the Islamic World What for the non-Islamic world seems familiar and commonplace is simply impossible for Muslims. For example, many banks in Muslim countries work from Sunday to Thursday, since Friday is considered Friday, so it is not surprising that banks and financial institutions are trying to get out of the situation by introducing their own norms for Muslim clients. Islamic forex accounts (SWAP-free accounts) are not an exception and...
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The market is over-the-counter and based on free currency conversion, so it is characterized by a rather high degree of state non-interference and lack of meticulous control by officials. Nevertheless, there is no complete anarchy in the currency market and this is due to the regulators. UK regulators: FSA For example, in such financially powerful countries as the UK and the U.S. there are long-standing and successful organizations that monitor compliance with the rule of law in a tumultuous flow. In the United Kingdom, the role of strict market regulator is played by the Financial Services Authority (FSA). The purpose of the Committee is to ensure transparency and maximum efficiency of financial markets in the UK, the fight against fraud and crime on it,...
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Once a man wants to try his hand at e, he follows a fairly common scenario. Having familiarized himself with the subject he is interested in, having plunged into the theory, he will soon demand to get acquainted with it in practice. In such cases, for those beginners who do not have a considerable capital or do not wish to risk at once, demo and cent accounts are created. A lot has been said and written concerning the expediency of these initial stages of trading on the exchange market, but most people agree that this stage is useful. Demo and cent accounts help beginners to hone their skills, get used to the terminal interface and gain confidence before making larger transactions. The difference between demo and cent accounts is...
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The first ECN (Electronic Communication Network) appeared in California in 1999 and was called Currenex. This brand is well known to many traders: the system is still the leading one in the ECN niche. In more than a decade of its existence, the technology has attracted millions of users and became the next step in the evolution of the forex trading market. What is an ECN-broker? The main difference between an ECN-broker and a classic dealing center is that the transactions are made directly to the interbank. In this case it is possible to completely exclude the intermediary and the possibility of playing the broker against the trader. With ECN the user gets access to the real market, where liquidity is supplied by the broker's counterparties...
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One way or another, everyone, who has faced a real account on the market, wondered the question: "How to choose a broker? How not to make a mistake, which will cost not only profit and spent time, but sometimes also the initial deposit. How to choose the broker, which will not be the next obstacle for earning in trading, but will become your friend, support and colleague, with whom it is pleasant to work? Traditionally everything that is presented with the label "Western" - products, services, software, entertainment industry projects - is considered better and of higher quality than their domestic counterparts. Not surprisingly, this stereotype, often justified, is reflected on e. When looking for something reliable, solid and stable, many...
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Regulation of the foreign exchange market in the U.S. is considered one of the toughest, but at the same time the most reliable in the world. Its mechanism is built on the principle of maximum protection of clients from fraudulent actions, although some features of the regulation are still a topic of active discussion. Today we will look at how regulation functions in the United States. The two most authoritative financial regulators in the United States are responsible for regulating the currency market: the Commodity Futures Trading Commission (CFTC) and the National Futures Association (NFA). The CFTC was created in 1974 with the original function of regulating the futures market. In 2010, the U.S. Congress passed the Dodd-Franc Act of 2010 to reform the futures market...
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Some brokers are proud to announce that they provide their services within the framework of the European regulation. For many traders it is a kind of quality sign - Europe is Europe. It's time to understand how exactly the EU regulation is implemented. The legal basis of regulation in the EU It should be noted at once that in the European Union, unlike other countries, there is no single regulator. Nevertheless, this does not mean that no one controls brokers in Europe. Each member country of the EU has its own organization whose function is to regulate the activity on the financial markets and each of the regulators has its own rules and requirements...
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