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Market Makers & ECN’s, Is the grass greener?

  • #221
  • May 19, 2010 5:20am May 19, 2010 5:20am
Hi all,

there is many brokers such as MR Trading and Interbank Fx, they all say that their MT4 is an ECN system but this is not true. I have contacted metaquotes and they said that the mt4 is not an ECN.

As they explained to me, the mt4 takes only 1 feed at the time. and the customer trades on one price only and not many banks.

So i would stay very far from does mt4 brokers that say that their mt4 is ECN.

Please to confirm my post or correct me if i am wrong.

Alek
  • #222
  • Jun 2, 2010 1:44pm Jun 2, 2010 1:44pm
Don't forget also that ECN brokers charges overnight Rollover fees when you hold positions open past a cutoff time, usually 5:00 pm EST whereas MM brokers don't usually charge you and many even pays you interest, many times competitive interest.

Although the interest doesn't amount to much, but is usually worths commissions of several trades and even more if you hold large positions and over several days to catch a big wave. And it's downright annoying.

Found that out the hard way.
Make your losses in demo. Earn your profits live.
  • #223
  • Edited 3:55pm Jun 2, 2010 3:24pm | Edited 3:55pm
Quoting Alek
Hi all,

there is many brokers such as MR Trading and Interbank Fx, they all say that their MT4 is an ECN system but this is not true. I have contacted metaquotes and they said that the mt4 is not an ECN.

As they explained to me, the mt4 takes only 1 feed at the time. and the customer trades on one price only and not many banks.

So i would stay very far from does mt4 brokers that say that their mt4 is ECN.

Please to confirm my post or correct me if i am wrong.

Alek
Hi Alek,

As far as I know, MT4 is a trading software with charts, trading interface, Account Management and etc. It wouldn't indicate whether your broker is an ECN or not. Any broker can use MT4. And there are genuine ECN brokers who DO use MT4. ECN and MM really refer to how our orders/trades are handled/routed by the brokers.

This is only according to what I know. I stand to be corrected. Please feel free to post.
Make your losses in demo. Earn your profits live.
  • #224
  • Jun 7, 2010 9:47am Jun 7, 2010 9:47am
This only depends on the type of position you are holding and the interest rates attached.

Market maker's do charge negative rolls on positions held overnight.

Quoting Forexia
Don't forget also that ECN brokers charges overnight Rollover fees when you hold positions open past a cutoff time, usually 5:00 pm EST whereas MM brokers don't usually charge you and many even pays you interest, many times competitive interest.

Although the interest doesn't amount to much, but is usually worths commissions of several trades and even more if you hold large positions and over several days to catch a big wave. And it's downright annoying.

Found that out the hard way.
XAU-XAG/USD_Gold n Silver Trader's Thread = Technicals, Fundamentals & News
  • #225
  • Jun 7, 2010 4:23pm Jun 7, 2010 4:23pm
Quoting XTrade
This only depends on the type of position you are holding and the interest rates attached.

Market maker's do charge negative rolls on positions held overnight.
True but I find that MM's rate is more competitive than ECN's for the same positions held.

Just my observation. I stand to be corrected.
Make your losses in demo. Earn your profits live.
  • #226
  • Edited Jun 8, 2010 1:54am Jun 7, 2010 10:34pm | Edited Jun 8, 2010 1:54am
Quoting Bollocks
the fight is usually as a result of people not trading correctly and blaming the broker. sure there are terrible brokers out there. but the level of quality is measurable by their customer service levels and uptime. other aspects such as slippage happens at all brokers and is usually due to volatile markets or low liquidity. another regular complaint is stop hunting, there is no such thing from a brokers standpoint. this is a result of bad trading or volatile markets. brokers would lose business if they hunted stops.

in conclusion, judge a broker...
STOP!!! You're killing me! You think Brokerages don't run (push) price.

Brokerages don't calling it "stop hunting" so to speak but they will run the market past a swing high or a swing low once they see a significant amount of stops close to said swing. They will collect the stops and then they'll ride it back the original direction for additional profit.

Yes, I would call it poor trading on the traders part to put a stop rather close to a SH or SL but don't fool yourself into believing market makers are saints.

Trade to trade well.
JD
It's Easy To Get In;.. It's Hard To Get Out
  • #227
  • Edited 11:26pm Jun 7, 2010 11:16pm | Edited 11:26pm


Hysterical!
Yes, stop hunting exists.

Let me just remind everyone (shopping for a brkr) that The Broker KNOWS where all it's clients stops are. Obviously, you have only told them in a specific order for another trade. When markets slow, for a "tick or two" LOL and the broker has seen multiple collected stops (no matter larger or small) they will then go into the REAL - not retail - interbank market - (No IBFX is not a member of the inner bank circle) depending on market volatility and place a market Moving order just enough to Wipe out the stops in obvious levels as graciously mentioned below, 2 pips below / above swing high / low.

This is why part of the reason it is hunting, I would venture to state that large FX knowledgeable institutions (banks) stop hunt the market at times as well.

Try placing a 67 pip stop on an average EUR/USD trending trade and see if it is hit. Nope. (NOT on NEWS) now place that same 20 pip (or one of the lesser joke values MT4 has plugged in! and surely you will be stopped out.
at a loss.

One thing they can't do is flat out lie about the price - now the spread is another thing.

I,m sure there are a slew of other tactics employed by market makers to stop hunt I would love to hear some of the others.
Widening spreads, Faulty X00 pip spikes.....

Quoting John D
STOP!!! You're killing me! You think Brokerages don't run (push) price.

Brokerages don't calling it "stop hunting" so to speak but they will run the market past a swing high or a swing low once they see a significant amount of stops close to said swing. They will collect the stops and then they'll ride it back the original direction for additional profit.

Yes, I would call it poor trading on the traders part to put a stop rather close to a SW or SL but don't fool yourself into believing market makers are saints.

Trade...
XAU-XAG/USD_Gold n Silver Trader's Thread = Technicals, Fundamentals & News
  • #228
  • Jun 25, 2010 12:19am Jun 25, 2010 12:19am
Well Said and Well done....

I think this is a piece of inspiration for me, may be some one doesn't agree with it or may be i am new in this business.

Adnan Ahmad.
  • #229
  • Jul 13, 2010 9:08am Jul 13, 2010 9:08am
Hi,

bit of a newb to fx trading. Just wanted to ask (since the front post on market makers (i assume this means the sites that offer metatrader based platforms) and ECNs dates back to 2006)) whether you think the conclusions are still valid? assume technology must have progressed since?

thx
  • #230
  • Jul 16, 2010 2:32pm Jul 16, 2010 2:32pm
Agree, as with ECN at least it's the whole market move that get some slippage. Less random & not stop hunting or spikes from no where to help market maker fill the pip bank.

We can't accept fair trades from some one we are trading against & have controle on price feed. Market maker will always make money, if we are good all they will do is then push a button & hop a spike we are out. Also they see stops & limits, & if you move manually you will get delayed execution so they can screw you all the way.

BUT theyre very very few number of real ECN arround. Many now are getting in the hype & claiming being an ECN, NOT true. Take big care.

Regards
FX 13
Brokers are angels
  • #231
  • Jul 17, 2010 8:17pm Jul 17, 2010 8:17pm
After trying to decide for a long time on the broker to use, I went with IB and have been using them for a couple weeks with Ninjatrader for execution. I havent had any bad fills, and no suspicious stops (has come within a couple ticks with no fill). The spreads are great, and if I need customer service, I can use the online chat. I use Tradestation for charting, however. Most importantly my account is up so far. Im not sure why so many choose to go with these market maker scammers other than the inital deposit requirement. Commissions are about $4 round trip for a lot, that is a lot cheaper than dealing with a dishonest broker who doesnt charge commissions.
  • #232
  • Jul 27, 2010 11:19pm Jul 27, 2010 11:19pm
Quoting ForexGuyNYC
After trying to decide for a long time on the broker to use, I went with IB and have been using them for a couple weeks with Ninjatrader for execution. I havent had any bad fills, and no suspicious stops (has come within a couple ticks with no fill). The spreads are great, and if I need customer service, I can use the online chat. I use Tradestation for charting, however. Most importantly my account is up so far. Im not sure why so many choose to go with these market maker scammers other than the inital deposit requirement. Commissions are about...
I traded with IB until I switched over to a FXPrimus ECN account. The reason for my switch was that FXPrimus' MT4 platform offers me the ease and flexibility to program my EAs for automated trading.
  • #233
  • Jul 27, 2010 11:38pm Jul 27, 2010 11:38pm
Quoting John D
STOP!!! You're killing me! You think Brokerages don't run (push) price.

Brokerages don't calling it "stop hunting" so to speak but they will run the market past a swing high or a swing low once they see a significant amount of stops close to said swing. They will collect the stops and then they'll ride it back the original direction for additional profit.

Yes, I would call it poor trading on the traders part to put a stop rather close to a SH or SL but don't fool yourself into believing market makers are saints.

Trade to trade...
The only brokerages that push prices are desks. Do you really think a bank is going to buy or sell millions and millions to get through size on an ECN to sweep a few 10 lots orders? LOL. Get a real platform and the "sweeping" will disappear.
  • #234
  • Jul 28, 2010 12:40pm Jul 28, 2010 12:40pm
well there's one broker, (fxopen) that actually gives you the option of trading a normal account with fixed spreads, or an ecn account with variable spreads, so take your pick.
  • #235
  • Mar 27, 2014 4:27pm Mar 27, 2014 4:27pm
Hello all,

Thanx forex opportunist for your post it made things clear to me.

Hope you or anyone can answer my question, I am about to open a live account with what seems to be a reliable broker with good reviews on the net especially peaceforex. They claim to be an ECN but then in the terms of conditions it states clearly that when you open a position the broker reserves the right to open an opposite position on their side. Is this standard terms and contract conditions or does this mean they are not a true ECN and will take positions against me?

If this is the case then I am doubtful to do business with a company that will make money when I lose as it would be appropriate for the business to make sure I lose.

Thanks for the one who is answering my question.

Kind Regards

Bully K

South Africa
  • #236
  • Mar 28, 2014 1:40am Mar 28, 2014 1:40am
Quoting Bully
Hello all, Thanx forex opportunist for your post it made things clear to me. Hope you or anyone can answer my question, I am about to open a live account with what seems to be a reliable broker with good reviews on the net especially peaceforex. They claim to be an ECN but then in the terms of conditions it states clearly that when you open a position the broker reserves the right to open an opposite position on their side. Is this standard terms and contract conditions or does this mean they are not a true ECN and will take positions against me?...
Whats the name of the broker?
  • #237
  • Mar 28, 2014 1:45am Mar 28, 2014 1:45am
Hi Mitch,

The name is excel markets... Anther note I asked them why it is stated in their contract and they replied:

...... Excel Markets is ECN broker, we will never take the opposite position side of a trade unless we had a technology failure that caused it. During normal circumstances, we do not take the opposite position. However, there may be some special circumstances, such as technology failure. As we stated before, we are trying to cover any "unforeseeable” event, so it is impossible to provide you with a full list to all these circumstances...........

Why would they take a position when they had a technology failer?....

Kind regards

Bully
  • #238
  • Sep 27, 2014 1:15pm Sep 27, 2014 1:15pm
it depends with your trading strategy.if you swing trade then spreads mean nothing and you can go with a MM but if you are a scalper you can use ECN
  • #239
  • Sep 28, 2014 6:31pm Sep 28, 2014 6:31pm
Quoting Bully
Hi Mitch, The name is excel markets... Anther note I asked them why it is stated in their contract and they replied: ...... Excel Markets is ECN broker, we will never take the opposite position side of a trade unless we had a technology failure that caused it. During normal circumstances, we do not take the opposite position. However, there may be some special circumstances, such as technology failure. As we stated before, we are trying to cover any "unforeseeable” event, so it is impossible to provide you with a full list to all these circumstances..............
They are a STP broker.

In other words no B book.
If there is a price failure then they will honour the trade and internalise flow until pricing comes back up (Im guessing)

An true ECN broker permits you to bid and offer inside the spread and also allows all their clients to trade against each other.
In other words its an exchange .
MT4 doesn't have this capacity as yet .
  • #240
  • Oct 30, 2014 8:27am Oct 30, 2014 8:27am
How come? SO you mean for example if i trade with Armada Markets which is ECN and offer MT4 then there is no ECN actually? It is a nonsense dude.. MT4 do support ECN cross-match order execution, because it is two different features of the broker platform and don't depend on each other.
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