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Is MBT really an ECN ?

Quoting jleblang
Flotsam,

Sorry buddy but what you are saying is completely inaccurate
No problem, I was just quoting word for word from your printed legal terms. I may have misinterpreted them as I am not a lawyer, but they do appear to say in plain English that you take the opposite side of every trade

I was merely trying to point out that most retail traders are under the impression that when using an ECN they as trading individuals are trading directly on the market against banks etc. As your terms clearly state, this is not the case. The misunderstanding may be entirely the fault of the inexperienced individual, but nevertheless the misconception is still widespread. When the opening post asked if MB Trading was a real ECN, I got the impression they were asking whether you were involved in the trade in anyway or whether you were simply providing a bridge between the trader and the banks. Your terms and your post here explains the situation very well. You may well be an ECN but most retail traders completely miss the true meaning of that, particularly with US based brokers, as I believe the opening poster has.
Based on the post from jleblang i have to revise my first answer.

Now MBT is a bucketshop.
Quoting jleblang
Asalada,

Can you please identify for me what you think an ECN means exactly? Let’s start there.
Still no response from anyone as to what an ECN means exactly? I think this is an important question so that I can further the conversation in order to answer/clarify all questions.
Quoting flotsom
No problem, I was just quoting word for word from your printed legal terms. I may have misinterpreted them as I am not a lawyer, but they do appear to say in plain English that you take the opposite side of every trade

I was merely trying to point out that most retail traders are under the impression that when using an ECN they as trading individuals are trading directly on the market against banks etc. As your terms clearly state, this is not the case. The misunderstanding may be entirely the fault of the inexperienced individual, but...

thanks flotsom,

I completely agree that much of the problem is the fact that traders are either inexperienced or don't fully understand the mechanics of the back office - this was a perfect example.

We will touch on ECN more shortly, but I'd like to hear from the experts first.
Hi Jleblang,
Could you also comment on the Ninja trader connection issue someone posted above? I got exactly the same problem here. Actually even worse because I was running an automated system when MBT got disconnected. Once it happened, I had to reboot Ninjia then lost the status the system depends on. This normally happens around 5pm, which is right in the middle of my trading time. I already contacted the Ninja trader support, their said the problem is on MBT side. Once it's disconnected, the COM object cannot be reused for reconnecting. Actually they even added a popup to remind me reboot Ninjia because I was unluckily using MBT. I also have IB and PFG accounts, neither of them have this. IB is the most reliable one, PFG got disconnected sometimes but could always reconnect automatically. Since you lowered down your commission recently, this connection issue is the only thing prevent me from trading MBT now.
I would simply love to see the faces of the traders who thinks its sounds cool to be the direct counter party at 100:1 leverage, when the next "Lehman Brothers" happens...
Hi Justin - I have heard a lot that your net cap requirement would be higher than $20 mil if the NFA didn't think you were actually STP/ECN. Can you point to some documentation from the NFA that states this. My understanding is that your net cap requirement doesnt start to go up unless you have over $10 mil in client deposits.

I remember talk a couple years back of two types of FDMs - FDMa and FDMb - where one would have less stringent requirements because they are proven to be STP - but I dont recall ever seeing this beyond speculation and I cant find it anywhere on the NFA website.

Re definition of ECN - my understanding is that technically it is an electronic communication network that allows end users to trade directly with counterparties without the need for a middleman - and specifically in forex it is usually defned by a platform which shows depth of market - i.e. the best bid ask spread, or top of book, and what quanitty in millions is available at that price.
Quoting jleblang
Asalada,

Can you please identify for me what you think an ECN means exactly? Let’s start there.
In Forex, ECN = Market Making, the only difference is that the counterparty instead of being the broker are other clients of the broker (a very few times) or most of times the providers of liquidity of the broker, in both cases, brokers, banks or dark liquidity pools want to be the counterparty because the fixed rule since markets exist is that in the long run, always, in any market, the 90% of traders end up losing all their money.

In Forex specially this percentage is higher, because of the high leverage, the leverage is so high because we aren't exchange stocks or futures, but just money, money from one country to another, and there is a lot of money deposited in banks that is don't be used for anything, so, in forex, near 97% of traders lose, that's the reason because there are so many forex brokers out there. Forex is the biggest business right now, and also the biggest casino
Wow, no/very limited slippage on MBT?

Do realise that the time a tick takes to register on a broker that is connected via the internet is approximately 4 ticks. Thus every trader is getting current price 4 ticks late (a few ms) and MBT doesn't slip on ticks? Billion dollar infrastructure?

A small slippage is acceptable to most true ECN traders. Remembering its a completely different market to MM, with orderbook scalpers and the likes trading for firms and eating up entire level liquidity.

From what was posted from your own terms, it clearly states that you trade AGAINST your clients, not that you are a bridge for client orders. Perhaps your legal team should check that out, or learn english... One or the other will suffice.

Your chasing the common retail traders for the explanation of an ECN, which you have twisted the meaning.

What you described was STP, not ECN. Which in itself is a good service sure, but the form in which you presented it to clients was defensive. Which is never a good image for a company.

STP means you do have a dealer, and if you are executing orders on behalf of clients, you HAVE to have a dealer. The connection is not free flowing (you admitted this yourself) therefore you are not ECN, and you should re-label yourself STP..

That is all from me in this thread.
What I think about ECN is that a broker that dont trade against us, and dont take any profit from the spread, only from commission. I think that's the simplest I can get on ECN by my point of view.

So the problem is you may not admit taking profit from spread, but your liquidity provider could be a Market Maker which wont make sense to advertise yourself as a true ECN provider. That is why it's strange to me to see 1.9pips spread almost all times on GBPUSD which you clarified.

So based on this point of view, I can see we will not be able to prove it. But I need to let you know I'm not an expert on ECN or STP technically behind the scene.



Quoting jleblang
Still no response from anyone as to what an ECN means exactly? I think this is an important question so that I can further the conversation in order to answer/clarify all questions.
Quoting Mr-Forex
In my opinion they're the worst ECN broker.

I've noticed price and spread manipulation all the time.

Looks like they don't get the real tight spreads from their LP or they have no interest in offering best spreads to the clients.
I don’t get how people feel safe sending their funds to FXPro. There’s a risk level there that exceeds all other risk to me. I have two friends that traded small accounts there and the execution went downhill after three months, which seems to be the norm with deal desks. They make it look great and give you good execution hoping to get more of your funds deposited and then suddenly the executions get worse. I assume they must have some formula for amount of time they want to see pass and then they don’t think people will deposit more funds. And then just wait for the day when they are gone overnight with all your money and there’s nothing you can do about it. I have zero interest in trading with a firm like FXPro, but people will do what they want. To me, it comes down to MBT and IB. I haven’t had problems with either. MBT feels more like an ECN but IB is slightly cheaper. MBT has more order types. To me, these are the only two options out there that meet my criteria of solid firms that are regulated where I feel safe and know that I’m not working against the desk. My limit orders definitely show properly on MBT so I know they aren’t playing games and are definitely an ECN.
Your profile lists you as living in the US. FxPro doesn't open live accounts from US residents, so did you open a demo your account with different country name, or do you have citizenship with another country?

Quoting asalada
What do you guys think about FXPRO?

I have some problems with requotes on FXPRO during fast market, but not news time, and my lack of discipline makes me wait for better price to get out, but then it happened, it goes against me more and more. I know this is my stupid mistake but that requote things that happen many times does make me loses much more than it should.
Quoting asalada
What I think about ECN is that a broker that dont trade against us, and dont take any profit from the spread, only from commission. I think that's the simplest I can get on ECN by my point of view.

So the problem is you may not admit taking profit from spread, but your liquidity provider could be a Market Maker which wont make sense to advertise yourself as a true ECN provider. That is why it's strange to me to see 1.9pips spread almost all times on GBPUSD which you clarified.

So based on this point of view, I can see we will not be able to prove...
That’s an interesting answer. First of all, an STP broker doesn’t trade against you. Takisd had a horrible post right above yours that doesn’t even grasp the concept of an ECN, but yours is closer. But let’s clarify the process.

An STP broker is one that has multiple liquidity providers and routes your order to the best price available at the time. Now, there is a difference between that and a broker that has only one or two liquidity providers and routes your order to them. Remember that what most banks want is to capture BOTH sides of your trade. That’s worth a lot of money to them. That’s what deal desks used to do. The reason is that the average person loses money over time. SOMEONE wants to be the opposite of everything you do. So in the current environment, if a firm a not a deal desk, many of them have essentially one liquidity provider that they send all orders to. This gives that provider both sides of the trade. Might as well be a desk. This is not STP. STP (Straight Through Processing) means that we have multiple providers and route your order to the best price available without bias. If you just take that sentence alone, you eliminate 95% of FX brokers from doing their best for you. Most have one LP or are a desk themselves.

That’s STP. Now, ECN adds a significant piece to the puzzle. Remember, we can be a firm that shows one bank’s quotes. We can hold your orders and route to that bank when they are marketable. We aren’t taking any risk in that case, and that matches the concept of STP. But ECN is a whole different piece. The key components of ECN are that your Limit orders are shown immediately to the whole market and that other customers of ours can hit you directly. That’s what ECN means. Period. Anyone that tells you different is selling you a newer desk model. If the GBPUSD is 1.5000 by 1.50015 and you place a trade to buy 10 at 1.50005, then your buy order should become the bid for all to see for 10 at 1.50005. That doesn’t mean they should know who you are. It isn’t about displaying the size, although we do. The key is that we don’t do anything but show the market your order. That’s ECN. If another customer sells GBPUSD at the market while you are the top bid, they hit you. That’s ECN.

A lot of people try to make it out to be something different. It isn’t. ECN means that we take your order, immediately reflect it to the market if it is a limit, and you can be hit by other traders on our system. We are not holding that order in any manner for ourselves.
Quoting Gidyup
I don’t get how people feel safe sending their funds to FXPro. There’s a risk level there that exceeds all other risk to me. I have two friends that traded small accounts there and the execution went downhill after three months, which seems to be the norm with deal desks. They make it look great and give you good execution hoping to get more of your funds deposited and then suddenly the executions get worse. I assume they must have some formula for amount of time they want to see pass and then they don’t think people will deposit more funds. And...
I've said everything about MBT.Nothing more to say.
Quoting jleblang
That’s an interesting answer. First of all, an STP...
Lol... My post is horrible because it exposed your defensive lies. Enjoy manipulating peoples words in the forum.

ECN is not just limit orders, stop orders, or direct market execution. Its a connection.

For all your clients know, their limit orders are being shown internally only.

I suppose you are going to tell me that on ECN market price has no available volume? Seeing as though you can only see a market executed order the tick that it happens.

No wonder the NFA and CFTC have started strict regulation in the US. Brokers are dishing our all sorts of animal food in order to get clients on board...

You are a counter party to all trades, this has been shown, therefore, your service is STP... Nothing more.

Good luck with long term business.
Quoting Cocoflanel
Justin,
when I watch the spread on IB , it varies constantly between 0.2 and 0.8 pips
How can that be if they smallest price increment is 0.00005 or half ( 0.5 ) the pip?
Quoting Takisd
Lol... My post is horrible because it exposed your defensive lies. Enjoy manipulating peoples words in the forum.

ECN is not just limit orders, stop orders, or direct market execution. Its a connection.

For all your clients know, their limit orders are being shown internally only.

I suppose you are going to tell me that on ECN market price has no available volume? Seeing as though you can only see a market executed order the tick that it happens.

No wonder the NFA and CFTC have started strict regulation in the US. Brokers are dishing our all...
You really have no clue, do you?
I agree with you on price and spread manipulation! I got stopped out of a trade on AUDUSD when price was 5 pips off! Now considering on a short, like I had, you have to add spread, the spread wouldve had to be 5 pips for my stop to get hit, not likely! Another time, my stop got hit but the trade didnt close, and as I watched price move for 2 minutes, it finally closed 20 pips furthor in the red. I contacted mbt and with a bunch of hasle, about 5 emails later, they refunded my account back to where my SL had been set. Im disapointed in what I've perceived as I wanted to believe they wouldn't do such things! This all happened on my Metatrader account. I dont know if the same is true on their Navigator platform or not. It seems they are run by entirely different people.


Quoting Mr-Forex
In my opinion they're the worst ECN broker.

I've noticed price and spread manipulation all the time.

Looks like they don't get the real tight spreads from their LP or they have no interest in offering best spreads to the clients.
Quoting dbeach777
I agree with you on price and spread manipulation! I got stopped out of a trade on AUDUSD when price was 5 pips off! Now considering on a short, like I had, you have to add spread, the spread wouldve had to be 5 pips for my stop to get hit, not likely! Another time, my stop got hit but the trade didnt close, and as I watched price move for 2 minutes, it finally closed 20 pips furthor in the red. I contacted mbt and with a bunch of hasle, about 5 emails later, they refunded my account back to where my SL had been set. Im disapointed in what I've...
I have heard this time and again. I use the MT4 for charting and trade on the Navigator and have had no such problems. Just my experience.
Quoting dbeach777
I agree with you on price and spread manipulation! I got stopped out of a trade on AUDUSD when price was 5 pips off! Now considering on a short, like I had, you have to add spread, the spread wouldve had to be 5 pips for my stop to get hit, not likely! Another time, my stop got hit but the trade didnt close, and as I watched price move for 2 minutes, it finally closed 20 pips furthor in the red. I contacted mbt and with a bunch of hasle, about 5 emails later, they refunded my account back to where my SL had been set. Im disapointed in what I've...
Sir,

Many brokers stop hunt, this is common knowledge.

That said, this is why you swing/position trade, and give your stops plenty of room. So even 10-15 pip spreads wouldn't close you out.

Keep reading around, you will see former big traders like 'Trader888' among others have a common theme and advice on their posts.
The best is summed up at the end of this post:
http://www.forexfactory.com/showpost...8&postcount=35

"I hope all you guys and girls enjoy your trading and dont allow it to rule your world. If I can give one word of advice to any new trader it would be this: TRADE THE LONG TERM FORGET ABOUT INTRADAY YOU WILL LOSE YOUR MONEY BEFORE YOU HAVE LEARNED WHAT TRADING IS ABOUT."

Take care.
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