The Really Useless Thread

That is from the FF (Forex Factory ) Trade Explorer. Whenever I make a substantial withdrawal, I just change the Custom Start date so I kind of "reset" my totals. You find it in the "Options" section of your Trade Explorer...



You can flip back and forth between the FULL history and your Custom date.

Negatory.

Holding Long, you lose a very slight amount. BUT...I held for 4+ months and I think I paid less than 3% of my total close. Negligible, I would almost say.

I could have answered this MUCH better about 5 years ago. I used to trade at an algo shop in Chicago. Maybe someone else here can do better.

Basically, you aren't trading directly with the clearing houses. At the hedge fund, we were and we got much better swaps. But think of your broker as the middle man: they have to pay swaps on the positions they hold. Well, you can bet your butt that these guys aren't going to pay out of pocket for this... they pass that cost on to us little guys. In fact, most of the time they turn just push it a bit negative so they can actually make money on the swaps.

I can't fault them too much for this. They're running a business and they have to make a buck. Without them, we're not trading but I try to be as conscious about rollover as I can when I enter trades. For example, I tend to avoid long positions in E/A due to rollover, and I usually stay away from short in AUD/USD.

Just said that a little while ago.

In an ideal world...fo sho! But...Forex and brokers are far from that!

Dog walking. Beer collecting.

Back in a bit.

Does look strange!

Some monkey probably fat-fingered it!

Thanks mate. Makes sense. Yeah, I totally understand them wanting to make a buck, but they end up gouging us in the end as usual. Without us, their is no them. Oh well, I should probably stop whining about crumbs anyways... but yes, I also do the same... avoid a/u shorts. I don't go off majors that often, so not much to pay attention too, but I do love me some aussie longs.

Asian pop on metals?

Time will tell...but I guess they were sleeping when Benny spilled his beans.

No more milf!

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Sadly, most retail traders obsessive over the costs/benefits of swaps and pay much lesser attention to the costs/benefits of spreads and commissions.

The spread is a trader's largest cost, and most have no clue. Not sure what I mean? Let's take a quick look... (my apologies if this post gets a bit lengthy).

Let's look at the spreads for EUR/USD for two different brokers:

MBTrading: typical spread = 0.8 pips commission = $2.50 per $100k traded

FXCM: typical spread = 2.6 pips commission = $0

To a newbie, the choice seems apparent... "why would I pay a commission... let's do this FXCM!"

But let's see what happens if Mr. Newbie buys $100k of EUR/USD at 1.2900 before BennyB drops money from his heli.

MBTrading: Mr. Newbie is immediately in the hole $2.50 hard money and $8 on paper (0.8 pips *$10/pip)

FXCM: Mr. Newbie is immediately in the hole $0 hard money, but $26 on paper. Ouch!

Now remember, buying at 1.2900 means that Mr. Newbie can only get out of the trade at a lose if he were to immediately get out. So, he can bail at a price of 1.28992 on MBT and 1.28976 on FXCM.

These are important numbers to note. It's bad enough that Mr. Newbie is in the more then 2x with FXCM, but it gets much worse.

But before we talk about that, let's look at the total costs for each broker if Mr. Newbie goes for just a 10 pip gain:

MBT: -$12.50 from entry plus another $2.50 for getting out, total cost = $15

FXCM: -$26 from the entry, nothing from exit, total cost = $26

Now, it's bad enough that most people don't realize that even by paying a commission with MBT, Mr. Newbie is better off. But check this out.

To make 10pips, Mr. Newbie actually needs the market to move 12.4 pips while trading with FXCM and only 10.8 pips with MBT. That's a HUGE deal.

When the price trades at 1.2910 (Newbie's target) one of two things happens:

- He gets his target filled on both MBT and FXCM
- He gets his target filled on ONLY MBT

Think about it. If the spread price on FXCM is printing 1.2910, that means that the price on MBT is printing 1.8 pips higher (the difference in the two spreads), or 1.29118. This means, Mr. Newbie is giving up a cost of another 1.8 pips on the exit, or $18. Now, Mr. Newbie's total cost for trading on FXCM is actually $44, nearly 3x the $15 it costs to trade on MBT.

But let's think about scenario #2 for a moment. What if, the price on MBT trade to say 1.2911 and then reverses. Well, if Newbie is trading on MBT, he barely gets filled (by a pip) and is happily out of his trade and headed to the bank.

If, however, Mr. Newbie is on FXCM, the story is quite different. When MBT is printing 1.2911, FXCM is printing 1.29092. Remember, price now reverses... Mr. Newbie never gets his target, missing by a paltry 0.8 pips and costing him who knows how much.

You might be thinking, "how often does that really happen?". Well, asking anyone who has been in this business awhile and they'll tell you they've had a SL or TP hit or missed by 1 pips or less enough times to remember. The opportunity cost in those situations can be immeasurable.

My goal here is not to get anyone to switch to MBT, but please... be educated on what your true trading costs are. I could build in more scenarios. For example, MBT actually pays me a rebate for limit orders. That means, if Mr. Newbie puts his entry and TP in as limit orders, MBT will actually pay him a commission of $1.00 per order, making Mr. Newbie's costs just the $13 that's baked in to the spread.

Back in the day, FX brokers didn't even have variable spreads. I remember EUR/USD being fixed at somewhere between 3-5 pips. There was no 5 decimal pricing. Brokers made a KILLING. The money isn't in the swaps, not by a long shot.

If you really can't get your mind wrapped around paying a commission, at least make sure you're getting the lowest spread possible. MBT even offers a "FREE" account without commissions. They show a comparison of their spreads to other brokers with a live chart here:

http://mbtrading.com/freeEXN.aspx

However, you can be sure that this "Free" account nets MBT more than their commission ones. I hope everyone is educating themselves about what their true costs of trading are, especially you short-term scalper types... YOWZA!!

Ok, rant over.

WTF... Ken!!!11!
At least use Avast as a virus-scanner...

i just had a seizure from reading geppy's post

Just found a nice little calc for you guys:

http://mbtrading.com/savingscalculator.aspx

too long? sorry.

ken is computer jesus.

he fixed my laptop remotely from toronto. my laptop was worthless and by the end of the weekend she was brand new..

Ken, I need some of that Jesusness!!!

Yep...good stuff.

Another enemy is...slippage! (Advertised) Best spreads in the world don't mean shite if your broker is a bastard and slipping you, or not filling you at all!

Generally...and I've been around (whore...cough, cough)...I've always been more satisfied (spread, fills, slippage/execution...customer service etc...)when I'm paying a commission. Find an introducing broker that offers (or be with your broker for a long time and ask them for) rebates on your commissions...and you're ahead of the game again. When I'm trading like a lunatic, my rebates will easily more than cover my rent!

Rebates + positive swaps == the shit!

More often than not, I get positive slippage with MBT... still puts a smile on my face every time.

In the arsenal, Hatches!

Every tool I have finds nothing! I could list off everything I have ran, but that would get old...very quick!

Had never heard of the Safety Scanner from MS that pipper suggested. Gave it a whirl...yielded no fruit...er...disease-ridden bollocks!

I'll track it down this weekend...or tomorrow if I close up early. Will post what I find in case anyone else has come across it. At least ONE person that PM'ed me has.

Is that a good thing?