I am not sure if this topic belongs to Broker Discussion Forum or if it was already discussed.
I can’t find an answer why Liquidity Providers don’t like News traders. Or more specifically, they don’t like traders who enter and exit trades within seconds. Somebody told me that they don’t have time to cover themselves and they lose money, but didn’t explain in detail. Why are they losing money in this case?
I am not talking about market maker brokers. I am talking about true ECN/STP brokers who usually welcome news (and similar) traders, but their Liquidity Providers don't...
What is the difference for LPs when I enter a trade and:
- exit within a second (which is not OK for them) comparing to
- exit the trade after two minutes (which is OK for them)
I appreciate any opinion.
Thank you.
I can’t find an answer why Liquidity Providers don’t like News traders. Or more specifically, they don’t like traders who enter and exit trades within seconds. Somebody told me that they don’t have time to cover themselves and they lose money, but didn’t explain in detail. Why are they losing money in this case?
I am not talking about market maker brokers. I am talking about true ECN/STP brokers who usually welcome news (and similar) traders, but their Liquidity Providers don't...
What is the difference for LPs when I enter a trade and:
- exit within a second (which is not OK for them) comparing to
- exit the trade after two minutes (which is OK for them)
I appreciate any opinion.
Thank you.