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  • #23,761
  • Oct 7, 2023 8:46am Oct 7, 2023 8:46am
Quoting TrAndy1
{quote} What I do not like is, that you as trader can make so many errors, and then get denied your payout. It should be all built-in the platform. For example auto-closing all your trades when daily loss limit is reached, without saying that you have violated anything. Also no news trading should be realized in that way, that no new orders can be opened on the Metatrader platform for limited time span and so on. So basically you can concentrate on trading and do not need to bother on breaking any rules, because you cannot, except max. overall loss....
Exactly what I think. That's why yesterday I gave the example of how Finotive handles de 60s SL (bad) rule vs CTI or Funded Pips (good)

If you really care about traders then you should present solutions to make them succeed and not rules to make them fail.
  • #23,762
  • Oct 7, 2023 8:47am Oct 7, 2023 8:47am
Quoting Takisd
{quote} There are many order flow strategies that are not a book. A book is copying a traders trade back to back. What if you have behavioral analysis to do other things to the trade in order to make money. For example, what if you net and hedge the entire db? Scalper flow is useless in this instance, but if you have plenty of regular flow you can effectively make more money than the winning traders will make. It requires you to accurate shape the flow that is produced and have a strategy around it. I have spent the last 6ish months working on this,...
You can forget this. There is no way any prop, except FTMO maybe, is that smart that they can make out of orderflow with certain strategies. That is like a very clever market maker behavior. The big banks might be doing this. But the retail prop cannot do this. There is no way, they can hire PHDs to have intelligent Quants who then can develop profitable strategies around orderflow. That is by far too complex and also too complicated in most cases. Because you need to outsmart each trader or the partial sum of any group of traders so that you can make money with an overlay strategy on their orderflow, which means the prop needs to have a strategy to each/sum of strategy/-ies from traders. That is by far too much. That cannot be realized. Forget this. I would not trust any such prop, because how they want to do this?
  • #23,763
  • Oct 7, 2023 8:48am Oct 7, 2023 8:48am
Quoting Capablanca
{quote} Exactly what I think. That's why yesterday I gave the example of how Finotive handles de 60s SL (bad) rule vs CTI or Funded Pips (good) If you really care about traders then you should present solutions to make them succeed and not rules to make them fail.
It should always be a "pay and go away" kind of scenario i think. At a minimum a refund.
  • #23,764
  • Oct 7, 2023 8:50am Oct 7, 2023 8:50am
The big banks in Forex who are doing most of all orderflow needs to have strategies to make more money out of it than competitors so they can offer better bid ask spreads with more offered volume on each side. They have the capacity to do so. They have a lot of people. All the other ones cannot do this.
  • #23,765
  • Oct 7, 2023 8:51am Oct 7, 2023 8:51am
Quoting Takisd
{quote} You forget 1 thing, the cost of doing business. It will be far greater than the revenue received if you use this distribution model. The reason why the prop space as is has an expiry date is because in has to be greater than out. External revenue sources are the only means of fixing that.
The percentage of the cut the prop firm takes from the bucket can be bigger, to cover the expenses. But ya, if there are no losers/customers in that month, the firm will have to make a loss for the fixed cost. I don't know much about how the inside of prop firms operates, so this is just me rambling lol

The idea that Trandy1 raised, can even be turned into some sort of lottery/powerball concept. People know the chance of them getting the unclaimed lottery price is close to zero, yet they are still tempted to do it because the cost to the potential massive price is negligible. But in trading, pure luck isn't the only factor. Trading skills play a big part too. Human psychology is always fascinating
memento mori
  • #23,766
  • Oct 7, 2023 8:52am Oct 7, 2023 8:52am
Quoting Takisd
{quote} It should always be a "pay and go away" kind of scenario i think. At a minimum a refund.
No, a refund is not enough. If you need to flip your account first, then this needs to be fully recognized on any refund, so that the refund is at least 200% or better 300%. Then this would mathematical equivalent. Otherwise this is loosing business for the trader, so why he should sign up with such a challenge structure ? No.
  • #23,767
  • Oct 7, 2023 8:52am Oct 7, 2023 8:52am
Quoting TrAndy1
{quote} You can forget this. There is no way any prop, except FTMO maybe, is that smart that they can make out of orderflow with certain strategies. That is like a very clever market maker behavior. The big banks might be doing this. But the retail prop cannot do this. There is no way, they can hire PHDs to have intelligent Quants who then can develop profitable strategies around orderflow. That is by far too complex and also too complicated in most cases. Because you need to outsmart each trader or the partial sum of any group of traders so that...
So what you are saying is you need to be smarter than a dumb person? You still don't seem to get it. 95% of traders lose. Full stop, there is no argument to be had on that fact. How is it hard to be smarter than them? There are behavioral measurements where you don't even need to analyze the market in order to manage the order flow.

Yes, MFF and FTMO are smart enough to resolve this via money and paying the right people to work for them to build these things. And AFAIK, they both have. I have been working on this myself on a tiny small itty bitty scale, but with small sample size as i have no access to massive data and there are many viable options so long as you can get the right price feeds, margin agreements, the right execution and make sure that you are doing it only to the right pairs (in this case you absolutely have to figure it out on gold as its most of the retail flow).

The one place all this is not viable is index CFDs. I believe this is because of liquidity issues but without a bigger data set i cannot confirm it.

That being said, i do not feel comfortable building a prop firm based on my small sample data. But the one thing I do know is that its viable.

You are right though, 99% of these prop firms do not have the know how or where with all to do it. But you should never assume a retail trader is smart.
  • #23,768
  • Oct 7, 2023 8:52am Oct 7, 2023 8:52am
Quoting Takisd
{quote} What about this then. So in the dashboard it reports to you if we are making money on your flow, on a W/W basis and also logs if each week the company made money on you or not. If for 3 months over 50% of the time the company doesn't they pay you out and also say sorry but thanks?
I would not go for it because I would probably not understand why and when my order flow was / was not worthwhile.

There's also another point: my order flow may be interesting in one market conditions and not interesting in another.

For example, in a trading range we can make more trades fading supports and resistance levels (high lots, shorter SLs, shorter TPs, lot of frequency, R/R = 1) but in trending markets maybe we use few lots, wider stops and even wider TPs, little frequency, high R/R.

The change of market conditions can make our previous rich flow in something useless for you.
  • #23,769
  • Oct 7, 2023 8:54am Oct 7, 2023 8:54am
Quoting TrAndy1
The big banks in Forex who are doing most of all orderflow needs to have strategies to make more money out of it than competitors so they can offer better bid ask spreads with more offered volume on each side. They have the capacity to do so. They have a lot of people. All the other ones cannot do this.
You are comparing market makers to market takers. The two things aren't even remotely similar in how they handle orders and how they execute positions. One makes price, other takes price. The two are not remotely similar nor are their methods to handle order flow with the exception of last-look.
  • #23,770
  • Oct 7, 2023 8:57am Oct 7, 2023 8:57am
Quoting Takisd
{quote} You are comparing market makers to market takers. The two things aren't even remotely similar in how they handle orders and how they execute positions. One makes price, other takes price. The two are not remotely similar nor are their methods to handle order flow with the exception of last-look.
Can you say what kind of strategies it should be (overall) to make some money out of orderflow then for the prop firm ?
  • #23,771
  • Oct 7, 2023 8:57am Oct 7, 2023 8:57am
Quoting TrAndy1
{quote} Can you say what kind of strategies it should be (overall) to make some money out of orderflow then ?
If you had something of value, would you give it to me for free?
  • #23,772
  • Oct 7, 2023 8:58am Oct 7, 2023 8:58am
Quoting Takisd
{quote} If you had something of value, would you give it to me for free?
You do not have to be specific, I did not ask for that. I only wanted to get an impression how this could be done. Sorry.
  • #23,773
  • Oct 7, 2023 9:01am Oct 7, 2023 9:01am
Just to give you my idea for free. I think the edge ratio would be very useful to determine if a trader can be A-booked or has useful orderflow. The edge ratio means, how one can enter and exit a trade in relation to its high (profit) and low (drawdown) [in average of all his trades]. So the max. edge ratio would be if one entered for a long position on the low, and it never went any X pips below and entered at the high of this trade (where no further profit could be made on this trade). That would be my two cents here. For free of you all, you see. I only want to make from trading, so I do not bother about how to create strategies out of orderflow, this is not in any interest to me, as I only want to do profits from my trades. So I would not hesitate to share any ideas here about the orderflow matter or anything else (like the prop score I developed and shared here).
  • #23,774
  • Oct 7, 2023 9:07am Oct 7, 2023 9:07am
So that you all understand what is the edge ratio, here are two good articles on it.

https://strategyquant.com/blog/edge-...rategyquant-x/

https://tradingtact.com/edge-ratio/
  • #23,775
  • Edited 9:20am Oct 7, 2023 9:10am | Edited 9:20am
Quoting Takisd
{quote} If you had something of value, would you give it to me for free?
YES! As long as I can make money from trading the answer is yes. I only care about my trading profits. Anything else is meaningless to me. I would share any other ideas.

And this orderflow thematic you cannot make money as trader out of it. You need to be a broker or prop firm, to make any use out of it. So You can share your ideas here, as you cannot make money out of it with your trading, or ?
  • #23,776
  • Oct 7, 2023 9:29am Oct 7, 2023 9:29am
Quoting Takisd
{quote} So what you are saying is you need to be smarter than a dumb person? You still don't seem to get it. 95% of traders lose.
And there's the rub. Fact is this space is filled overwhelmingly with yolo degen gamblers. Same degen gamblers who will never pull a profitable trade, but will spend their hard earned money chasing it. These prop firms wouldn't exist without their steady flow of retries.
Trade with confidence, trade without fear.
  • #23,777
  • Oct 7, 2023 9:31am Oct 7, 2023 9:31am
It's prob not my place to say this as I am relatively new here. But sometimes words can be easily misunderstood when it's not face to face, and real intentions can be lost in translation (great movie btw, love bill murray). So I am gonna quote what someone has said earlier, both are valuable members on this thread that have contributed a lot. We wouldn't know all these updates on MFF if it weren't for him. He's never under any obligation to give us all these info. And I believe he did try his best to hint to us what might be coming. And we also benefited from the shared first hand experience from another member with prop firms. I am thankful to both.

Have a lovely weekend everyone!
memento mori
  • #23,778
  • Oct 7, 2023 10:22am Oct 7, 2023 10:22am
[quote=Takisd;14608414] The problem is in order to avoid the CFTC I Would have to ignore US citizens because the CFTC, regardless of virtual, sim or geo location, requires these entities to be registered with them. NO MATTER WHAT. The same goes for 5ers ftmo etc who arent in the US or Canada. That tidal wave is coming, you can see it on the horizon.

Exacly what they did with the brokers. At one point, there were 70+ brokers available to US residents. Many great brokers, fully regulated (but in other jurisdictions). That number is now 3. However, if you can prove 10 million net worth, you can trade anywhere you'd like.
For those of you who say it's not about the money, it's not about keeping the little, middle guy down.....can you see how this is complete BULLSHIT?
In no way, shape or form is the CFTC protecting anyone, it's all about the money BEING DIRECTED WHERE THEY WANT IT TO GO.
If it was what they are claiming, why can't we trade with an ASIC regulated broker such as IC Markets, or a UK or EU regulated broker? Certainly better options than Oanda or Forex.......hell, most folks don't even realize the CFTC offers absolutely ZERO protection of funds in forex accounts....what exactly is the protection?
Protecting us from BETTER trading conditions, protecting us from having our funds insured?
The props were the escape from all of that, not only the added value of 15-20x what you could do on your own, but, more importantly, the freedom to trade like the rest of the civilized world.
Don't get me wrong, 90% of these firms should be shut down, most of us know which ones....
  • #23,779
  • Oct 7, 2023 10:26am Oct 7, 2023 10:26am
FXIFY does not have a chance to survive if that number is correct interpreted that they had -40% lower income from challenge fees in September like CableJ has shown. All the other prop firms except US based TFT and MFFX and of course MFF had gained. So FXIFY exception is a clear warning signal that there are lot of wrongdoings.
  • #23,780
  • Oct 7, 2023 10:38am Oct 7, 2023 10:38am
The only way FXIFY could survive would be my above described model in some posts earlier. Then they only need to adjust profit split to survive, from lower incomes.
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