demo account and live account differ in slippage? FXCM | Forex Factory

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demo account and live account differ in slippage? FXCM

  • #1
  • First Post: Jan 26, 2010 3:45am Jan 26, 2010 3:45am
Hello,

I'm using demo account of FXCM, it looks like it works perfect, even in news time, there's no slippage, just wondering it that true if I switch to a live account? FXCM.

anyone has experience?

Thanks.
  • #2
  • Jan 26, 2010 4:46am Jan 26, 2010 4:46am
Quoting rootkit
Hello,

I'm using demo account of FXCM, it looks like it works perfect, even in news time, there's no slippage, just wondering it that true if I switch to a live account? FXCM.

anyone has experience?


Thanks.
Most probably not..
All live accounts suffer some kind of slippage.
But if the demo runs fairly smooth then the live account probablly run smooth as wel.
  • #3
  • Jan 26, 2010 5:22am Jan 26, 2010 5:22am
I would be more worried if the live account DIDN'T have slippage. As demo accounts don't have real money, there is no liquidity question involved in being filled or not hence no slippage.
  • #4
  • Jan 26, 2010 6:46am Jan 26, 2010 6:46am
Quoting rootkit
Hello,

I'm using demo account of FXCM, it looks like it works perfect, even in news time, there's no slippage, just wondering it that true if I switch to a live account? FXCM.

anyone has experience?

Thanks.
no its not true... Not only fxcm but even every broker have a slippage problem... demo is totally different from live account... trade on live with a micro lot to test you will know the difference...
  • #5
  • Jan 26, 2010 8:41am Jan 26, 2010 8:41am
Quoting rootkit
Hello,

I'm using demo account of FXCM, it looks like it works perfect, even in news time, there's no slippage, just wondering it that true if I switch to a live account? FXCM.

anyone has experience?

Thanks.
Hi rootkit,

Oakmonster is right on this. Demo trades are not executed against actual liquidity being offered by the banks, so the demo cannot simulate slippage in the event liquidity has dried up. Slippage can occur in a live account.

Jason
  • #6
  • Jan 29, 2010 5:16pm Jan 29, 2010 5:16pm
Expect to loose a couple pips on the majors.
"Vidi, Vici"
  • #7
  • Feb 5, 2010 12:27pm Feb 5, 2010 12:27pm
I'm not sure about that - I appeared to be slipped 18 pips today over news on a demo trade. S/L was 20 pips, was stopped out for -38.3. Can't see that far back now in the tick data to see if the market gapped but it amounts to 'slippage' anyway. And a good thing too imo.
  • #8
  • Feb 6, 2010 2:24am Feb 6, 2010 2:24am
Quoting nunrgguy
I'm not sure about that - I appeared to be slipped 18 pips today over news on a demo trade. S/L was 20 pips, was stopped out for -38.3. Can't see that far back now in the tick data to see if the market gapped but it amounts to 'slippage' anyway. And a good thing too imo.
Nunrgguy,

I don't trade news events. It''s extremely difficult to beat the market makers at their own game. Quote servers get taxed and slow down or stop and spreads widen. Either they give you a fill that's so bad it's practically obscene or your trade gets busted. You might make some money this week and then lose it all and then some next week. I recommend trading breakouts off daily bars or 30 minutes to 4 hour bars and was referring to slippage off those time frame breakouts. A good news event should be utilized for a trend day not a quick scalp.
"Vidi, Vici"
  • #9
  • Mar 7, 2010 4:08am Mar 7, 2010 4:08am
Tell me something I DON'T know .

This is an aside and a complete tangent, another thread in itself really but tell me this:

Generally the consensus on most sites, including this one is that strategies should be back tested to measure statistics to define future probabilities. Now, I'm talking intraday trading here as that's how I trade.I really do not appreciated a total stranger telling me that I should only trade dailies as they do because they are not able to trade intraday profitably. That's their problem, not mine. I do not scalp generally, although I'm not averse to taking 1 and 2 pip winners while waiting for a runner!

Now, in backtesting to any significant statistcal degree, say over 4 years, would you agree that the data may include some news event bars? Does anyone when anaysing backtest data go back through it all and remove all trades that would have occured on news bars? How do you find out when the news bars were? I would imagine most people do not even consider the hours of the day they would be trading when back testing. For a valid test they should do both but I doubt if many actually do it. Therefore any back testing is intrinsically flawed right from the word go. They then go ahead and base a system around totally scewed statistics. Statistics which include trading during Asian session (which they don't trade live), and news releases (which they don't trade live). They then wonder why they lose, why the system breaks.

I know all about NOT trading during a news release so why did I do it on a demo platform? Because I was interested to see how the platform itself behaves at those times, does it lock up etc. because if it does on demo, guess what?
  • #10
  • Mar 17, 2016 5:21pm Mar 17, 2016 5:21pm
FXCM is a scam broker - check the complaints filed against them at the CFTC. Go to cftc.gov and type in "fxcm" and see what I mean.

These guys are NOTHING but CROOKS.

FXCM = SCAM BROKER
  • #11
  • Mar 17, 2016 6:00pm Mar 17, 2016 6:00pm
Quoting gravitist
FXCM is a scam broker - check the complaints filed against them at the CFTC. Go to cftc.gov and type in "fxcm" and see what I mean. These guys are NOTHING but CROOKS. FXCM = SCAM BROKER
Hi Gravitist,

Perhaps you weren't aware, but you responded to a thread that is over 6 years old. You can find a more up-to-date discussion on this topic here: http://www.forexfactory.com/showthre...35#post8816235

In it, I explain that no demo account can fully replicate the liquidity (or lack thereof) of live trading during major news events or other times when prices change quickly. Therefore, it's important to understand that slippage is a risk of live trading with any broker.

For this reason, you should appreciate the fact that FXCM's demo does its best to tell you (via the "Off quotes" message) when the price available in the market is beyond your chosen Maximum Deviation range. Isn't it better for you to have such information than to be given false confidence by a demo from some other broker that fills all your demo orders with no regard for whether those prices were truly available in the real market?

It's also worth noting that as an industry leader, FXCM is subject to a greater level of scrutiny than smaller, less-regulated forex brokers. We are one of the only retail forex brokers in the world that's regulated on three continents and a publicly-traded company averaging $14.7 billion per day* in retail customer trading volume. We welcome this position of responsibility, and our retail clients who place 654,287 trades through us per day* are glad we do.

FXCM takes regulations very seriously and believe it is in the best interest of our clients for us to have regulatory oversight and transparency. That's why we have over 80 employees in our compliance department as mentioned by our CEO Drew Niv in a recent earnings call. That's not to excuse previous regulatory actions, but rather to emphasize how we actively work with our regulators to resolve issues and ensure the best trading environment possible for our clients.

At FXCM, we take great pride in the quality of our execution. A yearlong study of orders placed through FXCM shows our clients received positive slippage as often as they received negative slippage: http://bit.ly/1KWaV8g

  1. 76.2% of all orders had NO SLIPPAGE.
  2. 13.5% of all orders received positive slippage.
  3. 10.2% of all orders received negative slippage.
  4. Over 58% of all limit and limit entry orders received positive slippage.
  5. 52% of all stop and stop entry orders received negative slippage.


In addition, FXCM provides you with unique tools to help you minimize your negative slippage and still receive the full benefits of any positive slippage that's available in the market:

  1. Market Range (AKA Maximum Deviation^ on our MT4 platform) lets you specify how much negative slippage you are willing to accept on a market order. If you set a Market Range of 2, then 2 pips is the most negative slippage you could get on the order. Otherwise it will be canceled to protect you from unwanted negative slippage. However, you could still receive 3 pips or even more positive slippage on the order, if a better price is available in the market.
  2. Range Entry works like Market Range but for pending orders (stops and limits) and is only available on our Trading Station platform (not MT4). In this earlier post, I show an example of how to use the Range Entry feature: http://www.forexfactory.com/showthre...22#post8552322



* As of the latest publicly available data from February 2016

^ Many MT4 brokers do not support the Maximum Deviation feature at all. Some brokers that do offer Max Dev use it to limit both your positive slippage and your negative slippage equally. By contrast, FXCM enhanced the Max Dev functionality of our MT4 platform to limit only negative slippage. That means, you can still receive the full benefits of any positive slippage that's available in the market when you use the Max Dev feature to minimize your negative slippage with FXCM.

  • #12
  • Mar 17, 2016 8:39pm Mar 17, 2016 8:39pm
Quoting Jason Rogers
A yearlong study of orders placed through FXCM shows our clients received positive slippage as often as they received negative slippage:
http://bit.ly/1KWaV8g 76.2% of all orders had NO SLIPPAGE.
13.5% of all orders received positive slippage.
10.2% of all orders received negative slippage. O
ver 58% of all limit and limit entry orders received positive slippage.
52% of all stop and stop entry orders received negative slippage.
Do you also have numbers of the total amount amount (or a factor) of slippage generated not only the % of occurrences? As within trading results strike rate isn't everything if the average loss is much greater than the average win. I have talked to an FXCM rep at a trading convention a few months ago and he pointed me to the stats showing the % of winning and loosing traders dependent on timeframe and pair traded. Are there more up to date statistics available? Those are always pretty interesting and I would like to see a bigger picture about which pairs are traded profitably/unprofitably at what session.
  • #13
  • Mar 21, 2016 3:21pm Mar 21, 2016 3:21pm
Quoting Kilian19
{quote} Do you also have numbers of the total amount amount (or a factor) of slippage generated not only the % of occurrences? As within trading results strike rate isn't everything if the average loss is much greater than the average win.
Hi Kilian,

While I don't have to those specific numbers, I have no reason to believe the amount or factor of slippage differs depending on whether it is positive or negative. That's because the same principles of FXCM's order execution apply in both cases:

 

  1. Example 1: I have a limit order to sell EUR/USD at 1.1300 and the market gaps through that price level over the weekend to start trading at 1.1350 at the start of the new week.
  2. Result 1: My limit order will be filled with 50 pips of positive slippage at the best available price in the market which is 1.1350.

  1. Example 2: I have a stop order to buy EUR/USD at 1.1300 and the market gaps through that price level over the weekend to start trading at 1.1350 at the start of the new week.
  2. Result 2: My stop order will be filled with 50 pips of negative slippage at the best available price in the market which is 1.1350.


With FXCM, traders have the added advantage of tools like Market Range and Range Entry which limit your negative slippage, but not your positive slippage. In Example 2 above, if I had set a Range Entry of 10 pips on my stop order to buy EUR/USD at 1.1300, then my order would have been canceled instead of getting filled with 50 pips of negative slippage.


Quoting Kilian19
I have talked to an FXCM rep at a trading convention a few months ago and he pointed me to the stats showing the % of winning and loosing traders dependent on timeframe and pair traded. Are there more up to date statistics available? Those are always pretty interesting and I would like to see a bigger picture about which pairs are traded profitably/unprofitably at what session.
You're referring to the Traits of Successful Traders reports by our DailyFX research team: http://bit.ly/1Tpimqa

We published the first version of those reports in 2011. The latest version was published last year, so that's probably the one my colleague shared with you.

This report discusses the P/L percentages by currency pair: http://bit.ly/1RTo0kx

This report discusses the best times of day to trade: http://bit.ly/1XI81Wc
  • #14
  • Mar 21, 2016 8:28pm Mar 21, 2016 8:28pm
Thank you for the reports. I will look through all of them and take a look at the old reports as well. Those are the real numbers every trader should be concerned about and they are much more valuable than some unemployment figures...

Quoting Jason Rogers
{ Hi Kilian, While I don't have to those specific numbers, I have no reason to believe the amount or factor of slippage differs depending on whether it is positive or negative. That's because the same principles of FXCM's order execution apply in both cases:
While the same principles apply in both cases, traders do not act the same way regarding placing their stop loss and take profit resulting in the sl being hit much more frequently during news events or spikes. This is at least my assumption as you see that the average profit is lower than the average win -> either people trade with no take profit or their rr is not being 1 thus resulting in an asymmetric sl and tp placement.
  • #15
  • Edited 4:56pm Mar 22, 2016 4:43pm | Edited 4:56pm
Quoting Kilian19
Thank you for the reports. I will look through all of them and take a look at the old reports as well. Those are the real numbers every trader should be concerned about and they are much more valuable than some unemployment figures...
It's my pleasure, Kilian

Quoting Kilian19
While the same principles apply in both cases, traders do not act the same way regarding placing their stop loss and take profit resulting in the sl being hit much more frequently during news events or spikes. This is at least my assumption as you see that the average profit is lower than the average win -> either people trade with no take profit or their rr is not being 1 thus resulting in an asymmetric sl and tp placement.
You are making two assumptions which could be influencing your conclusions.

First, you are assuming that trades are closed by stop loss or take profit orders. Many trades are closed by market orders which are just as likely to receive positive slippage as negative slippage with FXCM. In fact, our clients can use the unique Market Range feature of our Trading Station platform to limit the amount of negative slippage they get.

Second, you are assuming that stop orders are used to close losing trades and limit orders are used to close winning trades. That might be the case for the majority of such orders, but I know traders who use trailing stop orders to close their profitable trades. I also know traders who use limit orders to try to exit a losing trade for a smaller loss than is currently available in the market.

The stats show positive and negative slippage are symmetrical with FXCM. However, positive slippage is more common with limit orders, while negative slippage is more common with stop orders. That's due to the momentum of price movement when each of those order types is triggered.
  • #16
  • Last Post: Dec 19, 2018 3:45am Dec 19, 2018 3:45am
Quoting Kilian19
Thank you for the reports. I will look through all of them and take a look at the old reports as well. Those are the real numbers every trader should be concerned about and they are much more valuable than some unemployment figures... {quote} While the same principles apply in both cases, traders do not act the same way regarding placing their stop loss and take profit resulting in the sl being hit much more frequently during news events or spikes. This is at least my assumption as you see that the average profit is lower than the average win ->...
Kilian19, as said Jason, its a different orders. limit will have likely positive slippages, stop orders likely negative. Its a very important to know the numbers of course. Anyway fxcm has, perhaps, the best liquidity in the world. I have been using them for a long time.
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