That sounds like a loaded question doesn't it? Most would respond that you're trading against other traders or banks; and I believe that this is the case much of the time, but other times...
Does your broker modify the price to take out your stops? This has been discussed more times than I'd care to think about, so I won't go into this here.
But let me pose this to you. I received an "annual notice" from one of my brokers (no, I won't state the name, but it's pretty widely used) on May 30, 2008 and found the following near the bottom:
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THE FOREIGN CURRENCY TRADING YOU ARE ENTERING INTO IS NOT CONDUCTED ON AN EXCHANGE. <company withheld> IS ACTING AS A COUNTERPARTY IN THESE TRANSACTIONS AND, THEREFORE, ACTS AS THE BUYER WHEN YOU SELL AND THE SELLER WHEN YOU BUY. AS A RESULT, <company withheld> INTERESTS MAY BE IN CONFLICT WITH YOURS. UNLESS OTHERWISE SPECIFIED IN YOUR WRITTEN AGREEMENT OR OTHER WRITTEN DOCUMENTS <company withheld> ESTABLISHES THE PRICES AT WHICH IT OFFERS TO TRADE WITH YOU. THE PRICES <company withheld> OFFERS MIGHT NOT BE THE BEST PRICES AVAILABLE AND <company withheld> MAY OFFER DIFFERENT PRICES TO DIFFERENT CUSTOMERS.
IF <company withheld> ELECTS NOT TO COVER ITS OWN TRADING EXPOSURE, THEN YOU SHOULD BE AWARE THAT <company withheld> MAY MAKE MORE MONEY IF THE MARKET GOES AGAINST YOU. ADDITIONALLY, SINCE <company withheld> ACTS AS THE BUYER OR SELLER IN THE TRANSACTION, YOU SHOULD CAREFULLY EVALUATE ANY TRADE RECOMMENDATIONS YOU RECEIVE FROM <company withheld> OR ANY OF ITS SOLICITORS.
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Now, trading is NOT gambling if done correctly, but for lack of a better analogy: I really wouldn't walk into a casino if I knew that the casino even had the ability to legally change the outcome of my gains/losses based upon them knowing what cards I held.
Just food for thought.
- Bear
Does your broker modify the price to take out your stops? This has been discussed more times than I'd care to think about, so I won't go into this here.
But let me pose this to you. I received an "annual notice" from one of my brokers (no, I won't state the name, but it's pretty widely used) on May 30, 2008 and found the following near the bottom:
----------------------------
THE FOREIGN CURRENCY TRADING YOU ARE ENTERING INTO IS NOT CONDUCTED ON AN EXCHANGE. <company withheld> IS ACTING AS A COUNTERPARTY IN THESE TRANSACTIONS AND, THEREFORE, ACTS AS THE BUYER WHEN YOU SELL AND THE SELLER WHEN YOU BUY. AS A RESULT, <company withheld> INTERESTS MAY BE IN CONFLICT WITH YOURS. UNLESS OTHERWISE SPECIFIED IN YOUR WRITTEN AGREEMENT OR OTHER WRITTEN DOCUMENTS <company withheld> ESTABLISHES THE PRICES AT WHICH IT OFFERS TO TRADE WITH YOU. THE PRICES <company withheld> OFFERS MIGHT NOT BE THE BEST PRICES AVAILABLE AND <company withheld> MAY OFFER DIFFERENT PRICES TO DIFFERENT CUSTOMERS.
IF <company withheld> ELECTS NOT TO COVER ITS OWN TRADING EXPOSURE, THEN YOU SHOULD BE AWARE THAT <company withheld> MAY MAKE MORE MONEY IF THE MARKET GOES AGAINST YOU. ADDITIONALLY, SINCE <company withheld> ACTS AS THE BUYER OR SELLER IN THE TRANSACTION, YOU SHOULD CAREFULLY EVALUATE ANY TRADE RECOMMENDATIONS YOU RECEIVE FROM <company withheld> OR ANY OF ITS SOLICITORS.
----------------------
Now, trading is NOT gambling if done correctly, but for lack of a better analogy: I really wouldn't walk into a casino if I knew that the casino even had the ability to legally change the outcome of my gains/losses based upon them knowing what cards I held.
Just food for thought.
- Bear
Good pips to all ... bye