Is MBT really an ECN ? | Page 4 | Forex Factory

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Is MBT really an ECN ?

  • #61
  • May 19, 2010 4:39am May 19, 2010 4:39am
Quoting pipmutt
That's the bottom line, that and......

MB TRADING FUTURES (MBTF) AS COUNTERPARTY
THE FOREIGN CURRENCY TRADING YOU ARE ENTERING INTO IS NOT CONDUCTED ON AN EXCHANGE. MBTF IS ACTING AS A COUNTERPARTY IN THESE TRANSACTIONS AND, THEREFORE, ACTS AS THE BUYER WHEN YOU SELL AND THE SELLER WHEN YOU BUY. THE PRICES MBTF OFFERS MIGHT NOT BE THE BEST PRICES AVAILABLE.


Fair enough, as long as we all know where we stand.
Since forex is not exchange traded there is no NBBO like in US equities. Therefore a forex broker cannot guarantee that somewhere on this planet someone is willing to offer a better price than the one you get at the broker.
  • #62
  • Jul 26, 2010 8:05pm Jul 26, 2010 8:05pm
I don't know what wrong with MBT PRO chart ,Ican't find Daily candle

in for23/7/10 .26/7/10 also can't see have gap .what kind of chart is this.

Other broker chart don't have this problem.
  • #63
  • Jul 27, 2010 5:31am Jul 27, 2010 5:31am
Hello,
Ijust want to say thankyou to jleblang for answering in great detail all the queries that have been posted. I have been searching for a broker for quite some time . I like the platforms that have the dom style that are used in futures .
is there a reason fx brokers dont seem to have the dom style ladder platform.To me it make things so much easier with the one click operation. I will be getting ninja trader to use with you as the broker for this reason. Is there any plans to introduce a dom so i wouldnt need ninja?
thanks again .
making green pips large and red pips small this is my goal.
  • #64
  • Nov 19, 2010 5:48pm Nov 19, 2010 5:48pm
Quoting jleblang
As I stated (I thought very clearly), we ARE the counter party to 100% of our customer trades because we have the clearing arrangements with the liquidity providers in our system.
If you were the counter party to 100% of your customers trades solely for the purpose of clearing you would have stated clearly the reason for taking opposite side of the trade in your agreement. You did not state this in an explicit way in your agreement. You therefore should not be surprised that people do not buy your 'ECN' story.

Quoting jleblang
You (the customer) does not. You can’t trade with XYZ bank directly. You don’t have a signed document with them that says that at the end of the day, one of us will pass so many Euros or Dollars or Pounds to the other based on the net of trades that matched off during the day.
I suppose he does not have any documents signed either with millions of Johns Smiths that he trades stocks with on a daily basis, yet his stock broker does not take the opposite side of his trades.

The purpose of his stock broker is only to facilitate the trade between him and millions of other Johns Smiths without the need to sign any documents.

The purpose of an ethical ECN forex broker is that he does not need to sign any documents with other forex traders (Johns Smiths, banks, etc.). An ethical and true ECN broker is not the counter party.

The purpose of an non-ethical forex broker is to claim to be ECN and to take the opposite side of the trade.

Quoting jleblang
So, no, there is nothing to question about the way the agreement is written. It’s very clear and 100% accurate.
Yes, your agreement is fair and easy to understand. You trade against your customers. The problem is your agreement contradicts your advertising. In your advertising you claim something else.

Quoting jleblang
WE are the counter-party to all customer trades. That doesn’t mean that we trade against you.
Hahahaha, this is pure-nonsens from logical standpoint.

Being a counterparty means taking the opposite side of the trade, ergo you trade against your customers.

Similarily, not being a counterparty equals not trading against customers.

Quoting jleblang
That simply means that .....
Please do not tell us what it means. You failed on basic logic.

Quoting jleblang

Now, if you want to choose to believe ....
He does not choose to believe. If he wanted to believe he would have believed your marketing gibberish. Faith is for non-rational human beings.

Instead he based his knowledge on your agreements in which you state you are a counter party to his trades which is synonymous with trading against him. It has nothing to do with his faith. It has to do with empirical evidence that you delivered in your agreement.

Quoting jleblang
But I would say that, per wannatradefx’s prior post, it isn’t hard to prove that we are what we say we are.
The problem is you suffer from schizophrenia:
a) in your marketing documents you claim to be ECN
b) in your legal documents you claim to be a market maker who trades against customers

Quoting jleblang
The other thing that would disprove what I am saying is if you got a fill on our system during the day, and then at the end of the day ...
I cared not to read the rest. What you are saying was already put to test. It was tested against what is written in your legal documents. And I'm afraid what you say failed the test OR you have problem with your legal department!
  • #65
  • Edited 9:11pm Nov 19, 2010 8:58pm | Edited 9:11pm
Quoting Karl_Vosp
Being a counterparty means taking the opposite side of the trade, ergo you trade against your customers.
Technically, yes.

"What Does Counterparty Mean?

The other party that participates in a financial transaction. Every transaction must have a counterparty in order for the transaction to go through. More specifically, every buyer of an asset must be paired up with a seller that is willing to sell and vice versa." - Source: Investopedia


However, he did provide a logical explanation and you completely ignored it.

To my understanding of Justin's explanation, MBT has to deal with the true counterparty which is a bank/liquidity provider for you (because you can't deal directly with the bank), and you on the other hand are dealing with MBT.

The liquidity provider here is the one on the opposite side of your trade not MBT; but it's MBT that is handling the transaction to/from the liquidity provider to/from you. Therefore, legally speaking, they are your direct counterparty and are required to state so (even though they're not the ones on the other side of the trade but the bank is, through MBT). Again: Counterparty is "The other party that participates in a financial transaction".

They are approved and regulated by the NFA as an ECN broker, and personally, I don't think they would risk their business license by making such a serious lie claiming to be an ECN when they're not. So get your facts straight folks before jumping to accusations.
  • #66
  • Nov 19, 2010 9:14pm Nov 19, 2010 9:14pm
Quoting Marv
Technically, yes.

[color=Navy]"What Does Counterparty Mean?

The other...
The problem is that you used sound logic and make sense. Karl has no idea what that means.
  • #67
  • Nov 19, 2010 9:18pm Nov 19, 2010 9:18pm
Quoting Karl_Vosp
I cared not to read the rest. What you are saying was already put to test. It was tested against what is written in your legal documents. And I'm afraid what you say failed the test OR you have problem with your legal department!
Then don't trade with them. Nobody from MB Trading will shoot you for not choosing this broker.

Gee, where have I heard that before.....



Quoting Karl_Vosp
Nobody from Exness will shoot you for not choosing this broker.
  • #68
  • Nov 20, 2010 1:31am Nov 20, 2010 1:31am
Quoting Karl_Vosp
Being a counterparty means taking the opposite side of the trade, ergo you trade against your customers.
Are you suspecting the pizza boy of eating your pizza everytime you order it ..? It's him (not the pizzeria) who's your physical counterparty.
:-anything
  • #69
  • Nov 20, 2010 7:00am Nov 20, 2010 7:00am
Quoting asalada
Is mbt really an ECN? if so then why the GBPUSD spread is at 1.9pips...
No they are not
  • #70
  • Nov 20, 2010 7:01am Nov 20, 2010 7:01am
Quoting Marv
Technically, yes.
Good.

Quoting Marv
However, he did provide a logical explanation and you completely ignored it.
He provided a fairy tale that contradicts his legal documents. I suspect in case of a dispute the written agreement prevails, not stories from internet fora.

Quoting Marv
They are approved and regulated by the NFA as an ECN broker, and personally, I don't think they would risk their business license by making such a serious lie claiming to be an ECN when they're not.
They don't lie in legal documents. The regulator should be okay with them.
  • #71
  • Nov 20, 2010 7:03am Nov 20, 2010 7:03am
Quoting steve930
Then don't trade with them. Nobody from MB Trading will shoot you for not choosing this broker.

Gee, where have I heard that before.....

Idiot!
  • #72
  • Nov 20, 2010 7:13am Nov 20, 2010 7:13am
Guys this is all my fault!

This thread has been dead for almost four months, but then somebody on the Dukascopy thread asked the same counterparty question because Dukascopy has the same paragraph in their papers.

Dukascopy's answer was a little bit too "professional" so I gave a link to Jeblang's post since it was addressing the same concern.

I thought it would be helpful...
  • #73
  • Nov 20, 2010 9:16am Nov 20, 2010 9:16am
Quoting Karl_Vosp
He provided a fairy tale that contradicts his legal documents.
Care to elaborate?

What is so fairy-taly about his explanation?

No silly "broker conspiracy theories" please.

Quoting Karl_Vosp
Idiot!
"you never win an argument until they attack your person." -Nassim Taleb

Quoting dma
somebody on the Dukascopy thread asked the same counterparty question because Dukascopy has the same paragraph in their papers.
I guess Dukascopy is lying about its being an ECN too, right Karl?

Not too many years ago, we normal guys couldn't dream of trading Forex in an ECN environment. Now that we can with as little as $400, we chose to whine and bash brokers.

What's funny is that you almost never hear a big pro trader doing this, it's always the smallest of traders.
  • #74
  • Nov 20, 2010 10:20am Nov 20, 2010 10:20am
Quoting Marv
Care to elaborate?

What is so fairy-taly about his explanation?

No silly "broker conspiracy theories" please.
NO THEORY BUT THE REALITY: MBT is a marketmaker that trades against you. This is written in their agreement that they trade against their clients. This is not a conspiracy unless somebody misquated MBT's legal documents.


Quoting Marv
"you never win an argument until they attack your person." -Nassim Taleb
My bad. Point for you.


Quoting Marv
I guess Dukascopy is lying about its being an ECN too, right Karl?
I never said MBT was lying in their documents. I said that MBT delivered an evidence for being a non-ECN broker (counterparty to 100% of your trades).

As far as Duka goes, they are partly ECN and partly non-ECN. In some cases they are a counterparty and sometimes they are not a counterparty to their clients trades. You can read it in Duka's agreement.

Quoting Marv
Not too many years ago, we normal guys couldn't dream of trading Forex in an ECN environment. Now that we can with as little as $400, we chose to whine and bash brokers. What's funny is that you almost never hear a big pro trader doing this, it's always the smallest of traders.
Dream on
  • #75
  • Edited 12:24pm Nov 20, 2010 12:11pm | Edited 12:24pm
Quoting Karl_Vosp
MBT is a marketmaker that trades against you. This is written in their agreement that they trade against their clients.
Here's what's written:

MB TRADING FUTURES (MBTF) AS COUNTERPARTY
THE FOREIGN CURRENCY TRADING YOU ARE ENTERING INTO IS NOT CONDUCTED ON AN EXCHANGE. MBTF IS ACTING AS A COUNTERPARTY IN THESE TRANSACTIONS AND, THEREFORE, ACTS AS THE BUYER WHEN YOU SELL AND THE SELLER WHEN YOU BUY.

Again: They do this because there is no centralized exchange and you can't deal with the bank directly, you can only deal with MBT as the counterparty of your transactions, and then (behind the scenes) MBT deals with the bank which is your real (albeit indirect) counterparty.

Perhaps you still don't understand how an ECN actually works and think that you're trading in the actual interbank market? If that's what you think, then here's a little something that may help you:

"An ECN operates similar to a Tier 2 bank, but still exists on the third tier. An ECN will generally establish agreements with several tier 2 banks for liquidity. However instead of matching orders internally, it will just pass through the quotes from the banks, as is, to be traded on. It’s sort of an EBS for little guys. There are many advantages to the model, but it is still not the Interbank. The banks are going to make their spread or they’re not going to waste their time. Depending on the bank this will take the form of price shading or widened spreads depending on market conditions. The ECN, for its trouble, collects a commission on each transaction." - Source: Darkstar from ForexFactory

For more good info: http://www.forexfactory.com/showthread.php?t=7484
  • #76
  • Nov 20, 2010 12:47pm Nov 20, 2010 12:47pm
Quoting Marv
Again: They do this because there is no centralized exchange and you can't deal with the bank directly ... blah blah blah
Again: they say they do so because... blah blah blah

You can either believe what they say in which case you would be a believer or you can verify what they say in which case you would be a rational guy.

It took me a few minutes to verify http://www.forexfactory.com/showpost...38&postcount=5

THE PRICES MBTF OFFERS MIGHT NOT BE THE BEST PRICES AVAILABLE.

The above quote from MBT is contradictory to being an ECN. What the above may mean is that a trader with a $400 deposit is given an 'ECN evironment' with a market maker prices and execution.

Try to understand:
a) your argument is based on what is said by a guy who says he works in MBT
b) my argument is backed by the content of MBT's original documents
  • #77
  • Nov 20, 2010 1:15pm Nov 20, 2010 1:15pm
Quoting Karl_Vosp
THE PRICES MBTF OFFERS MIGHT NOT BE THE BEST PRICES AVAILABLE.

The above quote from MBT is contradictory to being an ECN. What the above may mean is that a trader with a $400 deposit is given an 'ECN evironment' with a market maker prices and execution.
FX market is not centralized. Therefore no broker (ECN or not), for example MBT, can offer best prices as there might be some other venue - let's call it LAVA for example - where some other participant is providing liquidity that is not available at MBT because they are not using MBT (disclaimer: I have no idea if MBT is actually aggregating LAVA).

It's not really that hard to understand.
  • #78
  • Nov 20, 2010 1:33pm Nov 20, 2010 1:33pm
Quoting Karl_Vosp
THE PRICES MBTF OFFERS MIGHT NOT BE THE BEST PRICES AVAILABLE.

The above quote from MBT is contradictory to being an ECN.
You need to do some homework buddy. (the Darkstar thread is a good start)

No broker can guarantee to offer you the best prices in the market, it all depends on what their particular liquidity providers chose to offer.

Also, any liquidity provider is free to pull out his liquidity at any moment during certain market conditions.
  • #79
  • Nov 20, 2010 1:33pm Nov 20, 2010 1:33pm
Quoting mikkom
FX market is not centralized. Therefore no broker, for example MBT, can offer best prices as there might be some other venue - let's call it LAVA for example - where some other participant is providing liquidity that is not available at MBT because they are not using MBT (disclaimer: I have no ide if MBT is actually aggregating LAVA).

It's not really that hard to understand.
Your argument makes sense unless you further investigate what is not precisely stated in MBT's clause. My experience with brokers offering 'ECN environment' is that depending on how much money you deposit you are given 'ECN account specific' data feed and execution.

The factual meaning of the clause 'the prices a broker XYZ offers might not be the best prices available' is NOT the best prices available on the market, otherwise the broker would have stated this.

The factual meaning is: we XYZ broker trade against you (which you agree to in the agreement - you cannot sue us for being a market maker) and we XYZ broker deliver you non-ECN data feed (which you acknowledge without realizing whether we mean not the best prices on the market, not the best prices in MT4, not the best prices on Monday, etc. - you cannot even sue us if you find better prices in second-rate broker in Papua New Guinea).
  • #80
  • Nov 20, 2010 2:10pm Nov 20, 2010 2:10pm
I have had a live account with MB Trading for years. Actually, I started with an EFX account that became MB Trading.

The number one thing that sucks about them is that the platform goes down for 10-60 minutes every day at New York close. However, in the grand scheme of things, it's not really that big of a deal. I'm just aware of it and work around it.

While we are on cons, I'll also mention the "awaiting messages from server" issue, that feels a little like slippage, but occurs rarely and could be my internet connection or a number of factors. It costs me a little profit from time to time, but again, in the big picture, not that big of a deal.

Now, let's move to the pros:

1. There is a phone number that I can call and talk to a 100% english fluency person/trader to open/close or do anything that I need to do on my account if my computer connection is not operating properly.

2. I feel like my deposit is safe. MBT is probably not going to close up shop tomorrow and take my money.

3. At the end of every trading week, I assess my profit and request a check withdrawal(If there's profit!). A few days later, I get a check from MB Trading. No worries about if that check will even come from Cyprus or Myanmar!

4. Customer service at MB is fantastic. I have never been disappointed any time I have contacted them. They are very good(and AVAILABLE) about communication, both electronic/email and telephone. And again, I have never had to deal with anyone that is not fluent in english or that I felt did not completely understand me.

5. MBT Desktop Pro is evolving as a platform and I am really liking what I am seeing. It's not totally ready for prime time, but it is an impressive effort and I am happy to be using it. When they get all the little issues worked out, it will be my favorite platform/charting package. Their dev team is very open and responsive as well (thanks, Ross)

Semantic analysis of ECN vs STP and the legal disclosure in their documents has no bearing on if I will continue to use MB or not. I use them because I am happy with their SERVICE(yes, we are paying them for their services, they are not leeching off of us.) and will continue to do so until I feel my relationship with them is no longer positive for me!
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