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Broker Cheating Me?

  • #1
  • First Post: Edited Apr 16, 2018 1:54pm Apr 12, 2018 5:39pm | Edited Apr 16, 2018 1:54pm
Hi,
I'm still trying to get my head around if this is even possible, I'd appreciate everyones feedback and any assistance with testing/proving this is possible/happening.
I have a dedicated server in New Jersey, NY so as to be close to my broker's server located in Equinix NY4 (at least that's what they told me...).
So I'm seeing latencies of 100ms+ in MT4, while if I ping the login server I get a consistent 7ms.
Attached Image (click to enlarge)
Click to Enlarge Name: Q - Broker Latency Arbitrage Against Me.png Size: 13 KB

Could the broker be using some form of latency arbitrage or similar to work against me?

I've obfuscated the details in the screen capture, but should it be proven to be happening I will provide details of the broker so others can avoid.
I contacted the broker about it already, but didn't receive any response, so that's why I've become suspicious.
thanks all..
  • #2
  • Apr 12, 2018 8:55pm Apr 12, 2018 8:55pm
Could be, but 100ms doesn't seem to be much delay. I run about 200ms with my broker. Never really considered it a scam. If it were seconds, as often reported by people with shady brokers then I'd be concerned.
  • #3
  • Apr 13, 2018 12:31am Apr 13, 2018 12:31am
Quoting drayzen
Hi, I'm still trying to get my head around if this is even possible, I'd appreciate everyones feedback and any assistance with testing/proving this is possible/happening. I have a dedicated server in New Jersey, NY so as to be close to my broker's server located in Equininx NY4 (at least that's what they told me...). So I'm seeing latencies of 100ms+ in MT4, while if I ping the login server I get a consistent 7ms. {image} Could the broker be using some form of latency arbitrage or similar to work against me? I've obfuscated...
Possibly, but there are many explanations like - where do they get the feed from originally? Probably IB in the US, not too srue? Maybe that's the server you need to be close to but NY sounds like a good bet.

Very hard to know as ping isn't usually a massive issue for clients tbh unless it's very large.
  • #4
  • Apr 14, 2018 4:53am Apr 14, 2018 4:53am
More likely they just mixed up sh*t by accident and gave you wrong informations. I would bet, they are located in LD4 instead of NY4. Give it a try and connect from a european based VPS ..
  • #5
  • Apr 14, 2018 5:20am Apr 14, 2018 5:20am
for all orders use take-profit orders in conjunction with stop-loss orders to manage open positions....
or use limits orders with TP & SL points...
the broker can't do anything with such orders
  • #6
  • Apr 14, 2018 6:54am Apr 14, 2018 6:54am
Quoting drayzen
Hi, I'm still trying to get my head around if this is even possible, I'd appreciate everyones feedback and any assistance with testing/proving this is possible/happening. I have a dedicated server in New Jersey, NY so as to be close to my broker's server located in Equininx NY4 (at least that's what they told me...). So I'm seeing latencies of 100ms+ in MT4, while if I ping the login server I get a consistent 7ms. {image} Could the broker be using some form of latency arbitrage or similar to work against me? I've obfuscated...
if u r on d same data center, ur latency should be around 2ms
WaBaS Where are Buyers and Sellers
  • #7
  • Apr 15, 2018 9:55pm Apr 15, 2018 9:55pm
I guess the just give you an incorrect information.
  • #8
  • Edited 1:50pm Apr 16, 2018 3:12am | Edited 1:50pm
So I've heard back from the broker, which I'll let you all know now is FXOpen.
Apparently what's happened is they've moved their servers to Latvia to be near their liquidity aggregator, Soft-FX.
I had already confirmed this with my own IP testing but had thought it was either an error with the IP locator, a hack, or a temporary fix after a recent data feed outage:
Attached Image (click to enlarge)
Click to Enlarge Name: FXOpen Server Location.png Size: 122 KB

As I'm based in AU I've put some more questions to them to see if it's the same for other FXOpen subsidiaries and will update if I hear more.
But as it's stands, for AU customers at least, FXOpen is looking like a bust if you want to use a dedicated server to get low latency with them.
To be fair they did offer to set me up with a VPS in Latvia, though I've tried VPS's in the past and found their performance substantially lacking.
I'd have to still question even if you did get a VPS in Latvia, you're still a long way from either NY or London where the bulk of transactions are happening.
  • #9
  • Apr 16, 2018 4:19am Apr 16, 2018 4:19am
FXOpen = typical bucket shop scammers

You better take your money and run.
  • #10
  • Apr 16, 2018 1:47pm Apr 16, 2018 1:47pm
Quoting The-Flipper
FXOpen = typical bucket shop scammers You better take your money and run.
I gather by that you mean they're a 'market maker'. I'm using their ECN account (https://www.fxopen.com.au/en/trading-accounts/).
Are you saying even with one of those accounts they're still trading against me?
If that's true then where do I go?
I thought by selecting an ECN account from an ASIC regulated broker I would be all good, no?
  • #11
  • Apr 16, 2018 4:58pm Apr 16, 2018 4:58pm
Quoting drayzen
{quote} I gather by that you mean they're a 'market maker'. I'm using their ECN account (https://www.fxopen.com.au/en/trading-accounts/). Are you saying even with one of those accounts they're still trading against me? If that's true then where do I go? I thought by selecting an ECN account from an ASIC regulated broker I would be all good, no?
No you wouldn't.
Most ASIC or other regulated brokers are just fraudulent "companies".
They are neither ECN, STP, DMA, nor NDD brokers.
More than 95% of all "brokers" are scammers without liquidity providers.
They will sabotage and trade against you even when they claim otherwise.

I've only found a handful trustworthy, real fx brokers which i can recommend at the moment:

In that order, but the regulation differs, so keep that in mind!

1. (IB) Interactive Brokers, LMAX (or based)
2. FX Pig (spa feed)
3. Varianse (Prime feed)
4. Darwinex, JFD Brokers, Global Prime
5. Dukascopy (or based)
6. Tradeview Forex

That's it.
  • #12
  • Apr 16, 2018 5:23pm Apr 16, 2018 5:23pm
Quoting drayzen
So I've heard back from the broker, which I'll let you all know now is FXOpen. Apparently what's happened is they've moved their servers to Latvia to be near their liquidity aggregator, Soft-FX. I had already confirmed this with my own IP testing but had thought it was either an error with the IP locator, a hack, or a temporary fix after a recent data feed outage: {image} As I'm based in AU I've put some more questions to them to see if it's the same for other FXOpen subsidiaries and will update if I hear more. But as it's stands, for AU customers...
You deal with NY4 or LD4 and perhaps TY3.

Liquidity providers to the brokers have their set ups in both .

Anything outside of this will be cross connected and that will have latency involved.

If the broker is B booking you it doesn't matter where u are as that order isnt hitting the market.
  • #13
  • Apr 17, 2018 11:50am Apr 17, 2018 11:50am
Quoting drayzen
Hi, I'm still trying to get my head around if this is even possible, I'd appreciate everyones feedback and any assistance with testing/proving this is possible/happening. I have a dedicated server in New Jersey, NY so as to be close to my broker's server located in Equinix NY4 (at least that's what they told me...). So I'm seeing latencies of 100ms+ in MT4, while if I ping the login server I get a consistent 7ms. {image} Could the broker be using some form of latency arbitrage or similar to work against me? I've obfuscated...
You have definitely a space to improve your connection speed, because the one what you get is true speed of connection.
I would say it depends on MT4 probably it imposes some speed restrictions or simply inefficient. Try to work out some API solutions for your trading.
  • #14
  • Apr 18, 2018 4:22am Apr 18, 2018 4:22am
Quoting The-Flipper
{quote} No you wouldn't. Most ASIC or other regulated brokers are just fraudulent "companies". They are neither ECN, STP, DMA, nor NDD brokers. More than 95% of all "brokers" are scammers without liquidity providers. They will sabotage and trade against you even when they claim otherwise. I've only found a handful trustworthy, real fx brokers which i can recommend at the moment: In that order, but the regulation differs, so keep that in mind! 1. (IB) Interactive Brokers, LMAX (or based) 2. FX Pig (spa feed) 3. Varianse (Prime feed) 4. Darwinex,...
Out of these, JFD Brokers really stands out to me. I am quite happy with my experience with them. good trading conditions in terms of spreads and latency, relatively low commissions, good customer support.
Also I was very impressed by their Post Trade Transparency report.

As per the connection speed, a VPS as close to broker’s server is the best possible solution I know.
  • #15
  • Apr 18, 2018 4:39am Apr 18, 2018 4:39am
Quoting The-Flipper
{quote} No you wouldn't. Most ASIC or other regulated brokers are just fraudulent "companies". They are neither ECN, STP, DMA, nor NDD brokers. More than 95% of all "brokers" are scammers without liquidity providers. They will sabotage and trade against you even when they claim otherwise. I've only found a handful trustworthy, real fx brokers which i can recommend at the moment: In that order, but the regulation differs, so keep that in mind! 1. (IB) Interactive Brokers, LMAX (or based) 2. FX Pig (spa feed) 3. Varianse (Prime feed) 4. Darwinex,...

It's true that a lot claim to be ECN or whatever and in reality, they aren't - they use an ECN broker so they put it on their website like they are the connection. They are pretty much all trading against you, though I really don't care about that as I am not trying to move the market anyway.

Good list of brokers.
  • #16
  • Last Post: Edited Apr 20, 2018 2:28am Apr 19, 2018 9:38pm | Edited Apr 20, 2018 2:28am
Quoting The-Flipper
{quote} No you wouldn't. Most ASIC or other regulated brokers are just fraudulent "companies". They are neither ECN, STP, DMA, nor NDD brokers. More than 95% of all "brokers" are scammers without liquidity providers. They will sabotage and trade against you even when they claim otherwise. I've only found a handful trustworthy, real fx brokers which i can recommend at the moment: In that order, but the regulation differs, so keep that in mind! 1. (IB) Interactive Brokers, LMAX (or based) 2. FX Pig (spa feed) 3. Varianse (Prime feed) 4. Darwinex,...
Hey The-Flipper, thanks for that, extremely helpful!
Now I'm seeing it's only a very small percentage of the 100's out there that's aren't in business to lighten your load, so I guess the traditional understanding I held of "broker" (i.e. someone who profits from your success) in this space would be more correctly referred to as "bookie"...
It's funny, I'd seen FX Pig in the past and wrote them off just by the name, instead going for a broker that looked more technically proficient, to my detriment.
Who's the dick that invented hindsight?

Having another read through documentation (that I should have been more thorough with originally), it's basically declared they're a market maker, quite deceptive advertising really with all that 'ECN' stuff.
------ provides OTC FX Contracts, CFD and PM Derivatives under the Market Maker (MM) model. This means that ------ acts as counterparty to each CFD, FX Contract and PM Derivative you enter into with ------ and this creates a direct financial exposure for ------. In its sole discretion ------ may hedge client orders, which involves ------ placing corresponding orders with third party liquidity providers. However, ------ will remain the counterparty to your contract and will remain responsible for meeting the obligations of your contract.

I did get a response from FXOpen about their server situation, sort of - it was very brief and formal, just saying that they're planning on having an LD4 POP but for the next few months it will be Latvia only.
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