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If you could be a forex market maker?

  • Poll

  • If you could be a Market maker for a low entry fee then you will think....
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  • #1
  • First Post: Jan 18, 2009 1:46pm Jan 18, 2009 1:46pm

Hi Everyone,

I have a questions + short poll i would like you to answer and participate in.

First here are some assumptions we are using for this questioner/poll

The industry statistics say that most traders fail (90-95% blowup their account within 2-4 months) and will lose their money

Market Makers such as FOREX.COM, GFT etc (NOT ECN's type hotspot, currenex or similar),make money when traders lose money- the amount of money made is based on how often they hedge their positions vs. total clients positions

Some brokers use STP i.e. every order is hedged , in this case the broker only makes money of the bid/ask spread (this is what fxcm uses)

My Questions-

These are targeted at any traders that has some trading experience in forex and understanding on how the business work
Or any trader that has some online marketing experience


1.Would you be interested in becoming a market maker (i.e. you control the spread and can benefit from trades loss/volume ) if the entry fee was around $5,000 (For margin)


2.Would you offer your services to your friends (instead of them going to other brokers)


3.Do you think that such business where you have complete control of the trading term offered (under your brand) will be lucrative for traders?


4.Would you say that traders are more likely to trade knowing that there is a fellow traders offering him the prices then a MM like the above or others

  • #2
  • Jan 18, 2009 2:53pm Jan 18, 2009 2:53pm
Its probably a good money maker, however its not somthing you cud just start up over night.
To answer ur questions, I wud never attempt to become a market maker.
If i did I wud of course offer it to my friends, in fact everyone I possibly could with incentives.
It wud be lucrative for some traders, but for most we already know it would not.
I think as long as you have a proffesional and regulated business then people would trade with you.

A few other things to consider is that you would need massive capital to get somthing like this up and runing.
To generate a decent enough income you would have to have staff for such a variety of things (telephone, order control, website, technical etc) , trading terminal software license, advertising costs, office space rental, electricity, computer hardware, paying tax, the list could go on.

If you think you cud just do this at home by your self you will never ever make decent money doing it. I dont know if this is what you are getting at though?
  • #3
  • Jan 19, 2009 8:46am Jan 19, 2009 8:46am
Guys.

What do you think? will this type of opportunity interest you?
Instead of funding an account with $5K, for trading , you can use the funds to offer trading terms to other clients (trading smaller size)?
  • #4
  • Jan 19, 2009 6:20pm Jan 19, 2009 6:20pm
I think the answer is ..tell me more.. LoL
  • #5
  • Jan 20, 2009 12:11am Jan 20, 2009 12:11am
Quoting fry2010
Its probably a good money maker, however its not somthing you cud just start up over night.
To answer ur questions, I wud never attempt to become a market maker.
If i did I wud of course offer it to my friends, in fact everyone I possibly could with incentives.
It wud be lucrative for some traders, but for most we already know it would not.
I think as long as you have a proffesional and regulated business then people would trade with you.

A few other things to consider is that you would need massive capital to get somthing like this up...
I totally agree wit fry2010. Its not so easy to become a market maker in few days. Huge amount of capital along with all technological equipment and staff is needed.
  • #6
  • Jan 20, 2009 4:38am Jan 20, 2009 4:38am
Exactly-- this is what i am asking , if you were given the infrastructure (virtual) to offer your own prices to other clients.

For example , if you had $5000 you can then provide MM services to smaller accounts (micro lots for example) , if you had $50,000 you can offer MM services to mini account holders etc

The point i am making is that you will be able to collect fees both on spreads (that you can custom set) and or clients losses (if you don't hedge their position and wait for them to bust)

This is different them becoming an IB of a broker, here you can make fees on the rev share.. Of course if you dont hedge clients position and they make money- you loose your margin
  • #7
  • Aug 11, 2010 3:33am Aug 11, 2010 3:33am
I try again, because my last post was not posted yet.

hello Oded

are You still here in this forum? I would like to talk about Your posting

"For example , if you had $5000 you can then provide MM services to smaller accounts (micro lots for example) , if you had $50,000 you can offer MM services to mini account holders etc

The point i am making is that you will be able to collect fees both on spreads (that you can custom set) and or clients losses (if you don't hedge their position and wait for them to bust)

This is different them becoming an IB of a broker, here you can make fees on the rev share.. Of course if you dont hedge clients position and they make money- you loose your margin"
  • #8
  • Aug 11, 2010 5:02am Aug 11, 2010 5:02am
A while ago I stumbled upon this site - there are complete packages for starting your own MetaTrader brokerage. No wonder there is a new MetaTrader broker every week. Etoro, Forexyard to mention but two. Like they're coming out of the walls.
I don't see the costs listed but I'm sure it was there somewhere. Find it if you're interested.
forget about tomorrow, just steal away into the night
  • #9
  • Aug 11, 2010 9:27am Aug 11, 2010 9:27am
Quoting spekitox
A while ago I stumbled upon this site - there are complete packages for starting your own MetaTrader brokerage. No wonder there is a new MetaTrader broker every week. Etoro, Forexyard to mention but two. Like they're coming out of the walls.
I don't see the costs listed but I'm sure it was there somewhere. Find it if you're interested.
thanks for the help.

I actually would like to start with metatrader or similar software and offer demo accounts only. only when I will get what I am looking for (brokerage/MM) I would start to switch to live accounts.
any ideas or comments?

still would like to talk to Oded.
  • #10
  • Aug 12, 2010 1:56am Aug 12, 2010 1:56am
Just a comment - you will have to advertise massively and /as pointed out in the documents/ make them punters trade all day so you make money on spreads. So, please don't put smiling ladies in your ads, don't put in messages like "you can make 50% a month", don't tell "trading the euro is easy". Whenever I see such messages, I surf away because they're big lies imho.

Quoting eli
thanks for the help.

I actually would like to start with metatrader or similar software and offer demo accounts only. only when I will get what I am looking for (brokerage/MM) I would start to switch to live accounts.
any ideas or comments?

still would like to talk to Oded.
forget about tomorrow, just steal away into the night
  • #11
  • Aug 12, 2010 2:58am Aug 12, 2010 2:58am
Quoting spekitox
Just a comment - you will have to advertise massively and /as pointed out in the documents/ make them punters trade all day so you make money on spreads. So, please don't put smiling ladies in your ads, don't put in messages like "you can make 50% a month", don't tell "trading the euro is easy". Whenever I see such messages, I surf away because they're big lies imho.
thanks again for posting and trying to help.

You are 100% right regarding the advertising. but as a Market Maker You don't only make money on the spreads.
and this is what Oded Rochman meant with his postings, imho. and thats the reason why I liked his idea.
  • #12
  • Aug 12, 2010 3:42am Aug 12, 2010 3:42am
another simple example.

everyone should know that the casino's make the money and the gamblers are losing in the long run. if I could get a chance to get a legal license for a land casino(=moneymaker), I would take it.

the same with forex trading. more than 90% of the forex traders losing their money. if I could get my own Brokerage/Market Maker(=moneymaker),
I would take it.
  • #13
  • Aug 12, 2010 4:19am Aug 12, 2010 4:19am
Well we could say money attracts money. Running a Metatrader bookies is just another type of business. If you have the funds, and you like the idea, why not.

Actually it's a well oiled machine running at 10000 rpm - heard about the Virtual Dealer plugin for Metatrader servers? Why would you sit and wait for the traders to lose their money the traditional way. Make the process faster with random requotes, delayed execution, preset slippage, etc etc. whatever you can imagine to make sure the client loses all his money.



Quoting eli
another simple example.

everyone should know that the casino's make the money and the gamblers are losing in the long run. if I could get a chance to get a legal license for a land casino(=moneymaker), I would take it.

the same with forex trading. more than 90% of the forex traders losing their money. if I could get my own Brokerage/Market Maker(=moneymaker),
I would take it.
forget about tomorrow, just steal away into the night
  • #14
  • Aug 12, 2010 4:55am Aug 12, 2010 4:55am
Forget about the Virtual Dealer.
Anti Scalper plugin sounds better ... but ...
Trader Abuse Plugin is the real thing!

"The system alerts in case of making more than X successful trading operations in less than specified time limit.
The system alerts in case of crossing the X profit percentage or value in less than specified time limit."

Oh, so making profits IS an abuse, you see.
Attached File(s)
File Type: pdf MT_plugins.pdf   93 KB | 1,626 downloads
forget about tomorrow, just steal away into the night
  • #15
  • Aug 12, 2010 9:44am Aug 12, 2010 9:44am
yes I would like to run a Metatrader bookies
  • #16
  • Aug 12, 2010 10:08am Aug 12, 2010 10:08am
This takes the cake. Seen the virtual dealer plugin before, but here they are explicit: "Trader Abuse" = trader success. "Love" the criterion for freezing the system (reminds me of GFT Dealbook).

Is this criminal or what? Where is NFA? Why isn't the software app co. charged with facilitating, or as accessory to, fraud?

Should we laugh or cry?

Quoting spekitox
Forget about the Virtual Dealer.
Anti Scalper plugin sounds better ... but ...
Trader Abuse Plugin is the real thing!

"The system alerts in case of making more than X successful trading operations in less than specified time limit.
The system alerts in case of crossing the X profit percentage or value in less than specified time limit."

Oh, so making profits IS an abuse, you see.
  • #17
  • Aug 12, 2010 1:31pm Aug 12, 2010 1:31pm
I think EVERY single MT4 broker has the possibility to cheat, use dirty tricks like the "Trader wins too much" plugin. I'm not saying any of them uses these but ... honestly ... if you had the chance, would you do it or not? Good old greed.

Quoting bit9ret
This takes the cake. Seen the virtual dealer plugin before, but here they are explicit: "Trader Abuse" = trader success. "Love" the criterion for freezing the system (reminds me of GFT Dealbook).

Is this criminal or what? Where is NFA? Why isn't the software app co. charged with facilitating, or as accessory to, fraud?

Should we laugh or cry?
forget about tomorrow, just steal away into the night
  • #18
  • Aug 12, 2010 2:03pm Aug 12, 2010 2:03pm
Quoting spekitox
I think EVERY single MT4 broker has the possibility to cheat, use dirty tricks like the "Trader wins too much" plugin. I'm not saying any of them uses these but ... honestly ... if you had the chance, would you do it or not? Good old greed.
to tell you the truth, I have lost a lot of money with all those dirty tricks, thats another reason to change sides.

am I the only one??
  • #19
  • Aug 12, 2010 2:24pm Aug 12, 2010 2:24pm
very interesting, i am going to check with nfa and others about legalities and complaints
  • #20
  • Aug 12, 2010 3:48pm Aug 12, 2010 3:48pm
Quoting spekitox
Forget about the Virtual Dealer.
Anti Scalper plugin sounds better ... but ...
Trader Abuse Plugin is the real thing!

"The system alerts in case of making more than X successful trading operations in less than specified time limit.
The system alerts in case of crossing the X profit percentage or value in less than specified time limit."

Oh, so making profits IS an abuse, you see.
And where are the SL-hunting plugin and the creation-of-huge-spikes-to-margin-call-before-the-trader-places-a-SL plugin? It would be interesting having them to the case one day I have the money enough to open a broker and begin to SL hunting you all.

I know these plugins exist because many brokers who post here are using them, you can go to the broker forum and look at these markets how aus customers talk about spikes of more than 300 pips with proves, images and even with the recognition of the broker representant that they exist.

It's without any doubt the best way to make money in Forex.

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