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Can Brokers see your MT4 EA/Indicators and Codes?

  • #1
  • First Post: Mar 13, 2007 11:22am Mar 13, 2007 11:22am
I am beginning to wonder that Brokers can actually see our EA and Custom Indicators codes.

This one is very difficult to prove/disprove because sniffing at the internet packets without the knowing how data is passed between client to server is like barking at the wrong tree - therefore purely "argumentative".

Do you have the same thought?
  • #2
  • Mar 13, 2007 11:50am Mar 13, 2007 11:50am
BK,

I'm not sure exactly to the answer, but my inclination is to say "no" they can't.

What I think they CAN do is determine IF you're using an EA to trade.

If you're wondering about brokers turning on and off (or screwing with EAs), my guess is that most brokers genuinely don't really care as long as their per trade cost is kept at a certain level.

I was told once by someone close to the broker industry (he had clients that were brokers), that what ticks brokers off more than anything is unexecuted orders (ie pending orders that get canceled). Apparently, there are some trading costs associated with this (although I couldn't really determine what they were).

Therefore, when an EA produces a bunch of orders that get quoted on the market, but don't get filled, that's a cost to the broker (albeit, probably small), that doesn't necessarily get passed to the consumer. Hence the reason why some brokers don't like EAs because EAs CAN create and cancel orders more rapidly than humans, which can lead to higher per trade transaction costs on the broker side.

Quoting BurgerKing
I am beginning to wonder that Brokers can actually see our EA and Custom Indicators codes.

This one is very difficult to prove/disprove because sniffing at the internet packets without the knowing how data is passed between client to server is like barking at the wrong tree - therefore purely "argumentative".

Do you have the same thought?
  • #3
  • Mar 13, 2007 12:46pm Mar 13, 2007 12:46pm
  •  tesla
  • | Joined Oct 2006 | Status: Friendly Neighborhood Programmer | 533 Posts
Quoting BurgerKing
I am beginning to wonder that Brokers can actually see our EA and Custom Indicators codes.

This one is very difficult to prove/disprove because sniffing at the internet packets without the knowing how data is passed between client to server is like barking at the wrong tree - therefore purely "argumentative".

Do you have the same thought?
First off, I believe they CAN see when an order is from an EA.

But... I can't see the average retail broker giving a rats-ass what logic their average client uses to enter a trade. If your EA starts spamming pending orders or does something else obnoxious that costs them money then they'll step in and disable automated trading on your account. Unless you're pushing huge volume the broker has puh-lenty of better things to do than watch your account and say "Hey... that guy we like to screw with just added another moving average to his EA." If you're really that paranoid, build all your logic into a dll and reference it from a "shell" EA.
  • #4
  • Mar 13, 2007 3:21pm Mar 13, 2007 3:21pm
Quoting tesla
First off, I believe they CAN see when an order is from an EA.

But... I can't see the average retail broker giving a rats-ass what logic their average client uses to enter a trade. If your EA starts spamming pending orders or does something else obnoxious that costs them money then they'll step in and disable automated trading on your account. Unless you're pushing huge volume the broker has puh-lenty of better things to do than watch your account and say "Hey... that guy we like to screw with just added another moving average to his EA." If you're really that paranoid, build all your logic into a dll and reference it from a "shell" EA.

Let me ask you this, then. I had an instance recently where an EA i was running on a demo account opened about 1600 trades (both Sell and Buy on the same pair) during the night -- I live in US EST. 500 closed at take profit levels. The sell orders closed at take profit levels and the buy orders closed out NOT at the SL. They closed mysteriously because there was plenty of margin available. Could the Brokerage have closed them? And if so, what recourse do we as investors have against them because if those buy orders had not closed the would have closed at their take profit levels about 2 hours later. Just curious why my orders mysteriously closed. Any insight?
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  • #5
  • Mar 13, 2007 3:25pm Mar 13, 2007 3:25pm
Quoting stacy
Let me ask you this, then. I had an instance recently where an EA i was running on a demo account opened about 1600 trades (both Sell and Buy on the same pair) during the night -- I live in US EST. 500 closed at take profit levels. The sell orders closed at take profit levels and the buy orders closed out NOT at the SL. They closed mysteriously because there was plenty of margin available. Could the Brokerage have closed them? And if so, what recourse do we as investors have against them because if those buy orders had not closed the would have closed at their take profit levels about 2 hours later. Just curious why my orders mysteriously closed. Any insight?
Most MT4 brokers have a limit on how many orders can be open at any given time. I think you may have been over the limit. You can look in the docs they list on their web site and find out what the limit is. In regards to what you can do about it? Find a broker, (if you can) that allows unlimited orders...
  • #6
  • Mar 13, 2007 4:02pm Mar 13, 2007 4:02pm
  •  tesla
  • | Joined Oct 2006 | Status: Friendly Neighborhood Programmer | 533 Posts
Quoting stacy
Let me ask you this, then. I had an instance recently where an EA i was running on a demo account opened about 1600 trades (both Sell and Buy on the same pair) during the night -- I live in US EST. 500 closed at take profit levels. The sell orders closed at take profit levels and the buy orders closed out NOT at the SL. They closed mysteriously because there was plenty of margin available. Could the Brokerage have closed them? And if so, what recourse do we as investors have against them because if those buy orders had not closed the would have closed at their take profit levels about 2 hours later. Just curious why my orders mysteriously closed. Any insight?
None, sorry. I can tell you that a broker has about zero incentive to screw with an EA running on a demo account unless it's causing network/server issues. Opening 1600 trades might just do that.
  • #7
  • Mar 13, 2007 4:02pm Mar 13, 2007 4:02pm
Quoting stacy
Let me ask you this, then. I had an instance recently where an EA i was running on a demo account opened about 1600 trades (both Sell and Buy on the same pair) during the night -- I live in US EST. 500 closed at take profit levels. The sell orders closed at take profit levels and the buy orders closed out NOT at the SL. They closed mysteriously because there was plenty of margin available. Could the Brokerage have closed them? And if so, what recourse do we as investors have against them because if those buy orders had not closed the would have closed at their take profit levels about 2 hours later. Just curious why my orders mysteriously closed. Any insight?
Now that is interesting. Why would the brokerage close your DEMO trades??? That's like blaming the broker for losing fake money lol.
  • #8
  • Mar 13, 2007 6:08pm Mar 13, 2007 6:08pm
Quoting mrmikal
BK,

I'm not sure exactly to the answer, but my inclination is to say "no" they can't.

What I think they CAN do is determine IF you're using an EA to trade.
Last September, I was trading at IBFX. The helpdesk specifically asked me if I was using EA to trade... Hmm they know I was using EA? Last Nov, I have to request MIGFX to enable EA trading (after my EA failed to execute). After then, I believe that they can know/determine if the trade is from EA or not.

Quote
If you're wondering about brokers turning on and off (or screwing with EAs), my guess is that most brokers genuinely don't really care as long as their per trade cost is kept at a certain level.

I was told once by someone close to the broker industry (he had clients that were brokers), that what ticks brokers off more than anything is unexecuted orders (ie pending orders that get canceled). Apparently, there are some trading costs associated with this (although I couldn't really determine what they were).

Therefore, when an EA produces a bunch of orders that get quoted on the market, but don't get filled, that's a cost to the broker (albeit, probably small), that doesn't necessarily get passed to the consumer. Hence the reason why some brokers don't like EAs because EAs CAN create and cancel orders more rapidly than humans, which can lead to higher per trade transaction costs on the broker side.

Interesting insight.

Does it cost the brokers to have STOP/LIMIT Orders?
ie, when we post them, waiting for price to hit our entry prices?
Or does it cost them if we have these orders deleted?
If we put our Entry Orders, the broker should match same order with the bank... perhaps this action cost the broker money to put such order with the bank? Hmmm... Seems possible.

My original thought for the thread is simple. Many traders make good money with their "secret EA"; I bet if a trader is winning a lot, the brokers would be very curious of the strategy. Heck, when I first started live forex with FXCM, my 1st week alone made more than 25% profit and they immediately called me asking what trade I was doing (I was not trading news then - just plain gut trades). So this sprung the thought that brokers are interested wiht our trading style and therefore knowing the EA/custom indicators we use is something they want.
  • #9
  • Mar 13, 2007 7:39pm Mar 13, 2007 7:39pm
Quoting tesla
None, sorry. I can tell you that a broker has about zero incentive to screw with an EA running on a demo account unless it's causing network/server issues. Opening 1600 trades might just do that.

Tesla,
I see your point but all the trades were open for more that 4 hours. with every up and down, oscillating back and forth of the pair price my EA opened a trade. You can know how many that can be if you have watched a chart at all with a price moving up and down 1 to 2 pips for an hour or so. I understand that a broker would not have any incentive to f@#$ with an my trades. That would lead to serious issues for them if the "word got out". anyway....thanks for the words.
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  • #10
  • Mar 13, 2007 7:41pm Mar 13, 2007 7:41pm
Quoting zawodowiec
Now that is interesting. Why would the brokerage close your DEMO trades??? That's like blaming the broker for losing fake money lol.
zaw...i would hope that a broker treats a demo account EXACTLY the same as a live account. what trust can we place in a broker if they don't. we forward trade and test strategies in demo accounts. if their methods are different for each type of account then we can't rely on testing.
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  • #11
  • Mar 13, 2007 8:34pm Mar 13, 2007 8:34pm
Quoting stacy
Tesla,
I see your point but all the trades were open for more that 4 hours. with every up and down, oscillating back and forth of the pair price my EA opened a trade. You can know how many that can be if you have watched a chart at all with a price moving up and down 1 to 2 pips for an hour or so. I understand that a broker would not have any incentive to f@#$ with an my trades. That would lead to serious issues for them if the "word got out". anyway....thanks for the words.
I think they would be happy to get the word out. They sent out emails to live account holders who had a number of open EA trades last year notifying us that they would limit the number of open and I think pending orders a customer could have on one account.

They may treat demos the same as live accounts so you get a more honest feel for how EAs trade on their accounts.
  • #12
  • Mar 14, 2007 7:28am Mar 14, 2007 7:28am
Quoting nvwine
I think they would be happy to get the word out. They sent out emails to live account holders who had a number of open EA trades last year notifying us that they would limit the number of open and I think pending orders a customer could have on one account.

They may treat demos the same as live accounts so you get a more honest feel for how EAs trade on their accounts.

I think the broker I was using was forex.com -- whoever the folks at strategybuilderfx.com are affiliated with. Anyway, I have no problem if a broker wants to limit the number of open trades......just don't let me open more trades than allowed and then close them for no apparent reason. I guess the moral of the story here is "limit the number of trades", right?
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  • #13
  • Mar 14, 2007 7:38am Mar 14, 2007 7:38am
Quoting stacy
I think the broker I was using was forex.com -- whoever the folks at strategybuilderfx.com are affiliated with. Anyway, I have no problem if a broker wants to limit the number of open trades......just don't let me open more trades than allowed and then close them for no apparent reason. I guess the moral of the story here is "limit the number of trades", right?
So is this a qustion of morals, or did you want to know the reason? The reason is probably over limit on orders. I have never been good at figuring out someone else's morality. LOL
  • #14
  • Mar 14, 2007 7:47am Mar 14, 2007 7:47am
Quoting stacy
I think the broker I was using was forex.com -- whoever the folks at strategybuilderfx.com are affiliated with. Anyway, I have no problem if a broker wants to limit the number of open trades......just don't let me open more trades than allowed and then close them for no apparent reason. I guess the moral of the story here is "limit the number of trades", right?
My last post would not apply to you since you are not using IBFX. I misunderstood. As far as EAs go check with the broker before opening a live account. Some brokers have specific rules pertaining to EAs. For example:
Quote
Customers who request a position several times before accepting one, also pose a problem. Some Expert Advisors are programmed in a way that they make some 100 requests each trade to find the best position. Have you ever called a phone broker for a buy on 100 Microsoft shares and rejected his offer two times? He will not even take the phone a third time.

Why is requesting a problem you may say. Well – we have a fully automated risk and money management in our backoffice software which executes our customer’s trades. Each request is a potential trade and leverages our risk and money management. And suddenly the hedging is bigger then the open positions. This costs us money and brings problems to the money and risk management. So one or two requests are ok but if an EA makes such a noise before accepting a position we have to treat him as a scalper. Even if these positions are long term positions.

Another thing is hunting for outstanding prices. When you follow the chart you see the peaks in a candle – these peaks come from deals in the interbank market where the big guys play (between 10- and 20-Million-trades or even higher. What if a Mini Lot tries to catch this peak?

By hand trading you will not get this offer. But those nice little EAs may hunt these prices and get a position there. Why? Because our trading server guarantees execution and the EAs are damned fast and catch them. But is not really possible to trade it. So we have to pay it. Which is not in our interest (and thus long term not in the interest of our customers) – it is no real deal – it is something like a ghost deal. The result is that we talk to this respective customer and explain it to him. If he does not change his style – respectively his EA – we will block his account and close it, if he is not willing to follow our advice. We have to protect our company against any loss to stay in the market for our customer’s security.
  • #15
  • Mar 14, 2007 7:55am Mar 14, 2007 7:55am
Broker CAN see you're using EA, where your EA have a magic number, that column only will be filled by the EA. Thats how to figure out. Another way is, their server has statistic data to collect your TP/SL and Entry. When they see 1 week in a row, all SL/TP are plot at the same pips from your entry price, they'll send you an email to ask whether you're using EA. Then they'll warn you EA trading needed atleast 10k! The server has another routine to MANAGE your statistics. If your trade has oftenly place TP at the same pip, they'll widen the spread at your TP once in a while(so your position wont get close). Same as stop loss, your stop loss will be oftenly kick in due to widen spread. eg.
You have a consistant EA working on 1:1 RRR, 50pips

Buy USDJPY at 115.00 TP 115.50 SL 114.50
When price at 115.46/49, widen ask, maintain bid at 115.46/52, cant close!
When price at 114.52/55, widen bid, maintain ask at 114.49/55. Congratulations!!! our company is honest, you've been honoured with stop loss.

There is 2 types of tricks broker's server use. One mentioned above, another type is freeze the price, so you cant blame them widen spread. Their OPTIMIZATION is good, I think better then any of the EA available here. Best works EA I've seen is Bag-it, never been hunt so far. Fuki, you rock! Hope this help explain what broker's EA did.

Regards,

David
  • #16
  • Mar 14, 2007 8:06am Mar 14, 2007 8:06am
Quoting BurgerKing
I am beginning to wonder that Brokers can actually see our EA and Custom Indicators codes.

This one is very difficult to prove/disprove because sniffing at the internet packets without the knowing how data is passed between client to server is like barking at the wrong tree - therefore purely "argumentative".

Do you have the same thought?
I don't think they can see your EA and anything else. That wouldn't be profesional, on the first hand, and the the other you only send buy/sell data, nothing else.
"Abandon all hope, you who enter here" La Divina Commedia, Dante Alighieri
  • #17
  • Edited 8:42am Mar 14, 2007 8:17am | Edited 8:42am
Quoting tesla
First off, I believe they CAN see when an order is from an EA.

This is not a question of belief. They CAN. I know.
I think IsTradeAllowed( ) is the function to check whether you can use experts or not:
http://docs.mql4.com/check/IsTradeAllowed


I have tried a broker myself that didn't let to use experts. You couldn't use scripts either to send orders.
  • #18
  • Mar 14, 2007 8:43am Mar 14, 2007 8:43am
Quoting davidke20
Their OPTIMIZATION is good, I think better then any of the EA available here. Best works EA I've seen is Bag-it, never been hunt so far. Fuki, you rock.
I second that motion.
Do not focus on making money; focus on protecting what you have.
  • #19
  • Mar 14, 2007 8:45am Mar 14, 2007 8:45am
Quoting semar
I don't think they can see your EA and anything else. That wouldn't be profesional, on the first hand, and the the other you only send buy/sell data, nothing else.
I disagree. I know they can. Just use an EA that doesn't include them.
Do not focus on making money; focus on protecting what you have.
  • #20
  • Mar 14, 2007 8:52am Mar 14, 2007 8:52am
There was a question in MQL4.com forum whether brokers can "see" the sources of indicators and experts of their clients or not. Unfortunately this thread seems to be deleted. At least I couldn't find it.

But their answer was that they can't. So, this is the "official" answer.

Technically, this is possible of course to program such an "option" for a broker that they can. I don't know if we should believe their official answer or not, but if you would be a programmer of MetaTrader, wouldn't you write this little backdoor into it? Or if you would be the owner of MetaTrader, what would you do?

I wouldn't make this option public for each and every broker, because this info would leak sooner or later. But I would think about making such an option somehow.
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