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Oanda vs. Interbankfx for Scalping

  • #21
  • Mar 7, 2008 10:55pm Mar 7, 2008 10:55pm
Moe - When I said the big boys, I meant private professional traders. I would not expect a large hedge fund, CTA's and other large institutions to be scalping - but do we really know what they do and how they do it? Dont they have a team of professional traders at their disposal? May be they do a bit of both?

Scex - Scalping is a hit and run type of trading. You spend little time in the market and from my personal viewpoint there are less risks. A good scalper will take 5-10 pips at a time but will immediately close for few pips loss if he is wrong. A scalper that lets his losses run and allows a scalping trade to become a swing trade is just not a good scalper.
I feel swing traders because they are in the market for longer periods, take more risks and are more subject to emotional decisions. Like seeing their positions whipsaw between profit and loss, averaging their trades and eventually letting their losses run.
  • #22
  • Mar 8, 2008 12:07am Mar 8, 2008 12:07am
Quoting PipStar
Moe - When I said the big boys, I meant private professional traders. I would not expect a large hedge fund, CTA's and other large institutions to be scalping - but do we really know what they do and how they do it? Dont they have a team of professional traders at their disposal? May be they do a bit of both?

Scex - Scalping is a hit and run type of trading. You spend little time in the market and from my personal viewpoint there are less risks. A good scalper will take 5-10 pips at a time but will immediately close for few pips loss if he is wrong. A scalper that lets his losses run and allows a scalping trade to become a swing trade is just not a good scalper.
I feel swing traders because they are in the market for longer periods, take more risks and are more subject to emotional decisions. Like seeing their positions whipsaw between profit and loss, averaging their trades and eventually letting their losses run.

Actually come to think of it, major banks probably do a bit of scalping, but not much. Certainly not in the service of central banks, but just for profit.

Interesting points on scalping. However, think of the mathematics involved. It is really hard to consistenly rake in those small profits. I for one am not good it!

On the emotional point, I can't really agree with you. Swing traders have much more time to analyse a trade and even diversify their portfolio.
Scalping can be very stressy from day to day even if you are successful.

I also don't see the problem with letting a longer time frame trend pickup a shorter term scalp (unless you are scalping against the general trend).

Also, technical indicators become more accurate on the higher time frame due to less market noise (in my experience).

Considering your points, it is hard for me to deceide on which one is riskier (assuming one is good at both).

In general, swing traders proably should not leverage as highly as scalpers do.

For me as a long term trader, I don't feel rushed to trade everyday and can wait until the setup is just how I like it.. this means I don't have to be right as often.
  • #23
  • Mar 8, 2008 11:11am Mar 8, 2008 11:11am
Quoting scexglobal
Actually come to think of it, major banks probably do a bit of scalping, but not much. Certainly not in the service of central banks, but just for profit.
What makes sense for a private trader, doesnt necessarily make sense for an institution. 'Scalping for a few pips using high leverage' isnt infinitly scalable, infact it isnt really at all. The bigger the positions are, the higher the spread/slippage will get, and the bigger the account is, the lower the obtainable leverage will be. For a fund with several hundred millions+ AUM the archivable profits would be a negligible. This is really a game for the small guy, relativly speaking, for whom the archivable profits are not negligible.

Many institutional FX platforms have special features for this problem, for example 'Clearview' for HotspotFXi or 'Powerfill' on Barx are designed to work such big orders. This isnt only a problem in FX, it is in all markets, and it also lead to the first steps of algorithmic trading(equities were first in this), which aimed to minimize market impact/improve fills/prevent front running etc. on big orders.
  • #24
  • Mar 8, 2008 11:35am Mar 8, 2008 11:35am
( Sniper Protection detects possible abuse of liquidity by predators ), you get label as a predator if you scalp large order's on currenex, they will kick you out.
If I Go Broke Trying Then I Will die happy.
  • #25
  • Mar 8, 2008 5:02pm Mar 8, 2008 5:02pm
shrike - in general, you are 100% right. But, around news times bank do get involved and this can only be considered a scalp.

moe - yup! That's why aggregation is good!
  • #26
  • Apr 28, 2008 1:01pm Apr 28, 2008 1:01pm
Quoting FrankTheTank
If you are a scalper, why not choose the broker with lowest commission? I dont think either Oanda or IBFX is good in that area.
Hi Frank, can you name any brokers that have lower comissions than Oanda? I heard about ECN-like brokers, that offer spreads as low as 1/10 pip, but when I calculated their comission + spread I got the same 1,5-2 pips on euro/usd, and more than 1,5-2 pips for other pairs. and Oanda offers 0.9 pip on euro usd. so it is cheaper.
  • #27
  • Last Post: Apr 28, 2008 1:21pm Apr 28, 2008 1:21pm
Quoting resol
Hi Frank, can you name any brokers that have lower comissions than Oanda? I heard about ECN-like brokers, that offer spreads as low as 1/10 pip, but when I calculated their comission + spread I got the same 1,5-2 pips on euro/usd, and more than 1,5-2 pips for other pairs. and Oanda offers 0.9 pip on euro usd. so it is cheaper.
Depending on the amount of money you plan on opening an account with; if you have 5k or more I would go with Interactive Brokers anything less I would go with oanda. I personally like both of these brokers and use them. I also have accounts with Interbank, Fxdd, and Gain and they are all ok but they have downfalls as with any of the brokers. Out of these that I use I prefer Interactive Brokers and Oanda but this is just my opinion of which some probably disagree....
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