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MB Trading really an ECN?

  • #1
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  • First Post: Jun 14, 2006 5:55pm Jun 14, 2006 5:55pm
is MBtrading really an ecn? usually ecns will not let you trade minis and mb does. they also will not disclose the banks they get their feed from nor say anything about a clearing firm. i watched the spread today and it was very similar to fxdd and ibfx.
  • #2
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  • Jun 14, 2006 6:03pm Jun 14, 2006 6:03pm
I've used their demo. Lightning fast with 1-2 pip spreads during high volatlity. I've even seen 0 pip spreads but they only last for a second or so. Pretty cool nontheless!!
  • #3
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  • Jun 14, 2006 7:27pm Jun 14, 2006 7:27pm
I've seen their demo as well. The quotes are very aggressive, they don't seem to just sit there during slow markets like at some market makers. They are also listed as an ECN broker at Go Forex. I've seen 0 - 8 pip spread EUR/USD during high volitility.
  • #4
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  • Jun 14, 2006 9:37pm Jun 14, 2006 9:37pm
Quoting ProdiG
is MBtrading really an ecn? usually ecns will not let you trade minis and mb does. they also will not disclose the banks they get their feed from nor say anything about a clearing firm. i watched the spread today and it was very similar to fxdd and ibfx.
They follow an ECN model...they are not a true ECN. I'm not sure what kind of deal they have going with their various sources, but they do use multiple sources to provide pricing and liquidity.

How they get away from requiring standard lots is beyond me.

Just FYI...Interactive Brokers also allows you to trade in mini-lots...so not sure if they're a true ECN either.
  • #5
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  • Jun 15, 2006 12:27am Jun 15, 2006 12:27am
http://www.goforex.net/forex-broker-list.htm
http://www.goforex.net/recommended-forex-brokers.htm
It listed HotSpotFX as recommended.
Min startup capital is $7500. Pretty higher than other market makers. If they don't accept mini lots, maybe this could be the genuine ECN link to interbank prices.
CCI decipherer
  • #6
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  • Jul 20, 2006 3:24pm Jul 20, 2006 3:24pm
apart from MBTrading, are there any other ECN-style brokers that allow 100:1 leverage?
  • #7
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  • Jul 20, 2006 3:36pm Jul 20, 2006 3:36pm
PropFX has a default leverage of 100:1, they will give 200:1 if requested. Low balance accounts will be set at 50:1 to help prevent a margin call. Minimum deposit is $10,000.
  • #8
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  • Jul 20, 2006 4:13pm Jul 20, 2006 4:13pm
thanks WM,

It says a "division of FXCM", I am curious what this means... if FXCM goes down in some way like Refco did, would PropFX account holders lose their money also?


anyone know of any other 100:1 ECN style brokers?
  • #9
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  • Jul 20, 2006 4:28pm Jul 20, 2006 4:28pm
Yes, PropFX and FXCM are one and the same.
  • #10
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  • Feb 11, 2008 7:50pm Feb 11, 2008 7:50pm
MB Trading has horrible swap rates. I asked customer service how they can offer negative reates on both long and short positions. The guy said the firm is for day traders, not position traders and explained as follows:

MBT Kaine: We are not receiving ideal rates and in exchange getting tighter spreads.
MBT Kaine: which has increased our volume
MBT Kaine: and will give us leverage in negotiating better rates
lowell: So, basically, you cater to day traders and do not provide attractive swap rates to position traders. ANd although you now have increased volume, you have yet to translate that into lower rates?
MBT Kaine: over all yes
MBT Kaine: and we every intention on doing so in the near future
MBT Kaine: it must be negotiated though
lowell: How near?
MBT Kaine: not sure no ETA



Just FYI
  • #11
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  • Feb 11, 2008 8:17pm Feb 11, 2008 8:17pm
that is why you have multiple brokers, and use each for their strengths
  • #12
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  • Feb 12, 2008 7:09am Feb 12, 2008 7:09am
Can you reccomend a good broker for position trading that offers mini accounts? What are the top 3?

Thanks.
  • #13
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  • Feb 12, 2008 11:59pm Feb 12, 2008 11:59pm
Quoting ProdiG
is MBtrading really an ecn? usually ecns will not let you trade minis and mb does. they also will not disclose the banks they get their feed from nor say anything about a clearing firm. i watched the spread today and it was very similar to fxdd and ibfx.
Hi ProdiG ~

Haven’t seen this question in a long time…..not since EFX first started offering Forex. I believed then and still believe to this day the only reason this question even exist is because other Forex brokers have spread this misconception. The fact is, it’s just not true. Let me break it down a bit for you - I’m going to pull from other writings I’ve done in the past.

First, you have to understand that our relationships with the banks (and they are numerous) that provide liquidity into our system are strong enough that those banks have broken up their electronic feeds to allow our customers to interact with their liquidity at any increment. You think about how this works, it isn’t a big leap. If a bank is showing $100,000 of EURUSD at a price, previously, they required that this be purchased as one block of $100,000 because it kept the number of transactions down. However, once they realized that many smaller players could still add up to the same amount and that our system was providing that sort of volume for them, they simply allowed the transactions to be broken up into smaller increments. It has worked out well for them and for our traders. Remember that unlike futures, such as the ES/SP contracts, forex is not traded as a “contract.” The idea of mini versus full is in name only. You are transacting actual cash, so the only limitation is what the entities on both sides set as a minimum.

Second, it should also be clear that our ECN falls under a different name (TDFX), but it shares many of the same owners as MB Trading. In other words, the same people, and some more, were involved in the investment of starting the ECN technology. Let me give you an example. At this time, we use TDFX exclusively as our ECN. When you trade stocks, you open an account with someone like Cybertrader or MB Trading or E-Trade. When you buy or sell a stock, it is often routed to an ECN like ARCA or ISLD. In other words, an ECN is a technology company set up to put customer orders together. The same is true here. EFX/MBTF is the actual FCM. Order routing is handled by TDFX. It has the technology to pass your orders straight to a bank without deal desk intervention at ANY increment. It also has the core technology to allow our customer orders to interact directly. TDFX, the ECN, was set up to create that technology. So if the EURUSD is 1.2685 by 1.2686, and a customer of EFX/MBTF places an order to buy the EURUSD at 1.26841 (note the fifth decimal place for a tenth of a pip), since that order is not marketable at the time (the price of the EURUSD is higher), that order is routed to the TDFX ECN to sit on its server. If the EURUSD quote moves down to 1.2684 by 1.2685 on the EFX/MBTF system, that ECN quote at 1.26841 becomes the best bid. If another customer at that point chooses to sell the EURUSD at the market, their order is routed to the ECN and hits the buyer limited at 1.26841. Both customers get that price. The spread is irrelevant. No deal desk interaction occurs.

To put it in one sentence, “We are a true, non-dealing desk direct access platform that accepts any order size equally into our marketplace and incorporates true customer-versus-customer ECN technology down to the tenth of a pip via the TDFX ECN, which we currently use exclusively.”

I hope this helps.
  • #14
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  • Feb 13, 2008 1:16am Feb 13, 2008 1:16am
Thanks for the interesting and informative post, Justin.

How do you respond to being described as "much (more) expensive" than Hotspot or IB. Is it a fair comparison?
  • #15
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  • Edited 10:31am Feb 13, 2008 9:11am | Edited 10:31am
Quoting opie999
Thanks for the interesting and informative post, Justin.

How do you respond to being described as "much (more) expensive" than Hotspot or IB. Is it a fair comparison?
At Interactive Broker you are charged 2.50 minimum commission for each trade, even if the trade is smaller volume. It might be disadvantage depending on the volume you trade with each transaction and your risk management. Also One of the good thing a broke can offer is a deal desk that you can contact to modify or close your position or orders if need.y


For Hotspot it is not possible to place or modify an order at less than 10 pips from the market which can become costly. You cannot open an order in the spread or even at the current price the order needs to be open 10 pips from the price.


It all depends on what you need study the brokers well and find the broker that match your needs



Edit: Thanks to shrike I have corrrected the fees information that was for stocks
  • #16
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  • Feb 13, 2008 9:40am Feb 13, 2008 9:40am
Quoting phil90
Well I don't totally agree with the fact that they are more expensive for example at Interactive broker does only allow to close an order if you contact them on the phone and they charge a fee for that. Also each time you cancel or modify an order on the software at Interactive broker they charge you. At Interactive broker there are also Smarrouting fee that are added to the commission so it means that you pay a routing fee as well. Also at Interactive broker the minimum they charge for commission is 2.50. So if you have a small order well you still pay 2.50 and not the commission that match the volume you traded.


For Hotspot it is not possible to place or modify an order at less than 10 pips from the market which can become costly. You cannot open an order in the spread or even at the current price the order needs to be open 10 pips from the price.


It all depends on what you need study the brokers well and find the broker that match your needs
Sorry, but the only correct thing in the above post is the IB $2.50 minimum per order. You dont have to call them to close a position (??), no routing fee and no fees to change/cancel FX orders. Hotspot had this 10 pip rule some time ago, but nowadays you can place orders whereever you want. You have always been able to post bid/offers inside the spread, the 10 pip rule only aplied for resting orders (stop, limit TP).
  • #17
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  • Feb 13, 2008 10:20am Feb 13, 2008 10:20am
Quoting shrike
Sorry, but the only correct thing in the above post is the IB $2.50 minimum per order. You dont have to call them to close a position (??), no routing fee and no fees to change/cancel FX orders. Hotspot had this 10 pip rule some time ago, but nowadays you can place orders whereever you want. You have always been able to post bid/offers inside the spread, the 10 pip rule only aplied for resting orders (stop, limit TP).

I apologize It seem like the order modification fees are only for Stock.

p.s I have corrected my post above to mention this
  • #18
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  • Feb 13, 2008 11:08am Feb 13, 2008 11:08am
Smartrouting is only for exchange-traded instruments (except futures) too. You can also correct the Hotspot 10 pip rule.
  • #19
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  • Feb 13, 2008 11:20am Feb 13, 2008 11:20am
Quoting phil90
At Interactive Broker you are charged 2.50 minimum commission for each trade, even if the trade is smaller volume. It might be disadvantage depending on the volume you trade with each transaction and your risk management. Also One of the good thing a broke can offer is a deal desk that you can contact to modify or close your position or orders if need.y


For Hotspot it is not possible to place or modify an order at less than 10 pips from the market which can become costly. You cannot open an order in the spread or even at the current price the order needs to be open 10 pips from the price.


It all depends on what you need study the brokers well and find the broker that match your needs



Edit: Thanks to shrike I have corrected the fees information that was for stocks
Phil,

Being able to contact a trade desk to modify your trades is not a product of deal desk or no deal desk; this is simply a function that all Forex brokers should offer their clients. With a true ECN broker you should also be able to place stops and limits at any price or in our case between the current markets bid/ask - if the broker truly isn't making money on the spread then there should be no restrictions.
  • #20
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  • Feb 13, 2008 11:32am Feb 13, 2008 11:32am
Quoting jleblang
Phil,

Being able to contact a trade desk to modify your trades is not a product of deal desk or no deal desk; this is simply a function that all Forex brokers should offer their clients. With a true ECN broker you should also be able to place stops and limits at any price or in our case between the current markets bid/ask - if the broker truly isn't making money on the spread then there should be no restrictions.
Thank you for that explanation I tought the office you contact to get assistance in modifying your trades over the phone was called a deal desk.
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