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Is anyone here an institutional trader?

  • #461
  • Jul 3, 2014 4:57am Jul 3, 2014 4:57am
Quoting limprobable
Hello, Thanks a lot for this intersting thread. What do you think about metal, gold especially ? Is there something particular to know about trading this strange beast?
I don't trade gold, Ihave enough trouble trying to figure out the FX markets
  • #462
  • Edited 10:16am Jul 3, 2014 9:02am | Edited 10:16am
Quoting Ck87
{quote} Read everything you can about and from Jesse Livermore and manage your money better than he did. Don't even think about day trading, bypass that noise and focus on big moves/big trends. If you pay attention to stock markets, currencies and commodities there will be a couple a year max. You'll be able to live a good life and not deal with the day to day emotions and hell of day trading, which is just way too much to go through imo. The real money is in the big moves. Don't let the hype and excitement of day trading lure you in. It's not worth...

Hi Mate,

My suggestion is to read the book "Global Expertise in the Foreign Currency Markets" whereby the author follows institutional traders around at a key bank for a long period, and clearly demonstrates they are trading intra- day.

Please see below for great review on above book. This review provide very good analysis about the book.

http://2ndskiesforex.com/forex-tradi...rency-markets/
  • #463
  • Jul 4, 2014 1:51pm Jul 4, 2014 1:51pm
Do your clients want to trade currencies for profit or hedge? Can you divide customers percentage for their goal in trading?
  • #464
  • Jul 4, 2014 2:33pm Jul 4, 2014 2:33pm
Quoting Naokia980
Do your clients want to trade currencies for profit or hedge?
Whats the difference?
  • #465
  • Jul 4, 2014 9:57pm Jul 4, 2014 9:57pm
Hi skenobi and Jacob. I was just wondering if you would know why any given forex pair almost always returns to any given price level within a short period of time, e.g. a few hours to five days?
  • #466
  • Jul 5, 2014 3:26am Jul 5, 2014 3:26am
Here is an interesting presentation.

http://issuu.com/instituteoftrading/...sity_tour_2013

If you prefer videos, start here.

Inserted Video
If you are good at something, never do it for free--Joker
  • #467
  • Jul 5, 2014 4:10pm Jul 5, 2014 4:10pm
Quoting Stinky
Hi skenobi and Jacob. I was just wondering if you would know why any given forex pair almost always returns to any given price level within a short period of time, e.g. a few hours to five days?
Hi, I really wouldn't know other than a lack of a strong underlining trend
  • #468
  • Jul 6, 2014 1:08am Jul 6, 2014 1:08am
Quoting Stinky
Hi skenobi and Jacob. I was just wondering if you would know why any given forex pair almost always returns to any given price level within a short period of time, e.g. a few hours to five days?
Depends on how robust price discovery was.
The road to pipland is arduous and fraught with challenge.
  • #469
  • Jul 6, 2014 6:33am Jul 6, 2014 6:33am
Quoting Stinky
I was just wondering if you would know why any given forex pair almost always returns to any given price level within a short period of time, e.g. a few hours to five days?
The sunday open gap...
  • #470
  • Jul 6, 2014 6:45am Jul 6, 2014 6:45am
Quoting FlashCall
{quote} Whats the difference?
when their is corporate flow, (around 10% at our desk) they don't care about MTM p/l, hence they don't feel squezzed if the trade goes against them because presumably its a hedge and the p/l is netted out with higher sales (or whatever it is that they do).

However if they are speculating, they clearly do care about MTM p/l and are going to be in-and-out of the market a lot more. And will feel squeezed at certain levels, especially if they have stop loss orders.

It is very important for news flow traders to know if its corp flow or leveraged / real money demand etc.

For example, lets say back when EURUSD was just shy of 1.4 a few weeks ago. clearly someone bought at 1.3990 and if it was a speculator, you would expect them to cover the trade when it turns lower (hence further downside). where as if it was corporate buying, they won't be covering that trade, they'll just leave it as its a hedge.

all in all, its very, very important.
  • #471
  • Jul 6, 2014 1:21pm Jul 6, 2014 1:21pm
Quoting Aws1962
{quote} when their is corporate flow, (around 10% at our desk) they don't care about MTM p/l, hence they don't feel squezzed if the trade goes against them because presumably its a hedge and the p/l is netted out with higher sales (or whatever it is that they do).
So they do hedge to maintain profits...just not more (or the same) profits...

Quoting Aws1962
{quote}It is very important for news flow traders to know if its corp flow or leveraged / real money demand etc. For example, lets say back when EURUSD was just shy of 1.4 a few weeks ago. clearly someone bought at 1.3990 and if it was a speculator, you would expect them to cover the trade when it turns lower (hence further downside). where as if it was corporate buying, they won't be covering that trade, they'll just leave it as its a hedge. all in all, its very, very important.
Where does the news trades comes in play with that?
  • #472
  • Jul 6, 2014 1:25pm Jul 6, 2014 1:25pm
Quoting FlashCall
{quote} So they do hedge to maintain profits...just not more (or the same) profits... {quote} Where does the news trades comes in play with that?
- my point is that they don't really care about trading profits or losses. They care about their final profit/loss which comes from selling their product/service. Hence why they hedge and don't care in the slightest if the EUR drops 3% against their long position.

- I am sorry, I am not quite sure what you are asking on that second point :/
  • #473
  • Jul 6, 2014 1:41pm Jul 6, 2014 1:41pm
Quoting Aws1962
{quote} It is very important for news flow traders to know if its corp flow or leveraged / real money demand etc.
How to figure out if its corporate flow or leveraged accounts? Does price behave differently?

Quoting Aws1962
{quote}
(around 10% at our desk)
How much volumes your trade desk do on average a day? Is it gradually distributed during the day?
  • #474
  • Jul 6, 2014 2:06pm Jul 6, 2014 2:06pm
Quoting dns_di
{quote} How to figure out if its corporate flow or leveraged accounts? Does price behave differently? {quote} How much volumes your trade desk do on average a day? Is it gradually distributed during the day?
1st - you know who was on the other end of the trade, its not anonymous. So you know if its a corporate or a fund for example. Price doesn't behave differently, but you can use that information to trade differently from their on.

gradually distributed, hell no.

volume, can't say. (also don't know the most recent numbers)
  • #475
  • Jul 6, 2014 3:38pm Jul 6, 2014 3:38pm
Quoting Aws1962
{quote}It is very important for news flow traders to know if its corp flow or leveraged / real money demand etc.
...

- I am sorry, I am not quite sure what you are asking on that second point :/
Why is it important for news flow traders to know if its corp flow or leveraged / real money demand etc?
  • #476
  • Jul 6, 2014 3:43pm Jul 6, 2014 3:43pm
Quoting FlashCall
{quote} Why is it important for news flow traders to know if its corp flow or leveraged / real money demand etc?
Oh right, Because if its corporate buying, they aren't going to be forced out of a position on a slight drop etc. where as leveraged flow might be buying, but as soon as it turns (for whatever reason*) they will start to sell.

* Normally news related, hence its good for market makers to know if they need to aggressively position / force someone's hand. if its corporate, it aint gonna work.
  • #477
  • Jul 6, 2014 4:09pm Jul 6, 2014 4:09pm
Quoting Aws1962
{quote} Oh right, Because if its corporate buying, they aren't going to be forced out of a position on a slight drop etc. where as leveraged flow might be buying, but as soon as it turns (for whatever reason*) they will start to sell. * Normally news related, hence its good for market makers to know if they need to aggressively position / force someone's hand. if its corporate, it aint gonna work.
Im not getting this - why would corporates would be in the market (hedging?) during news? But anyway...never mind...its not really important...
  • #478
  • Jul 6, 2014 4:15pm Jul 6, 2014 4:15pm
Quoting FlashCall
{quote} Im not getting this - why would corporates would be in the market (hedging?) during news? But anyway...never mind...its not really important...
its not that they trade during news. its whether or not there has been large corp flow *before* news events, but yeh, to a dealer this information may be worth a mere pip, nothing to really care abt
  • #479
  • Jul 6, 2014 6:57pm Jul 6, 2014 6:57pm
Quoting dns_di
@Jacob and skenobi, well, you both excluded other, which is not by rules , discretionary, is other substantial contributor to the budget?
I think I get what you mean now by "other" (you should have put the word in quotes ). Anyways, as far as I'm concerned, your item "c" (in your original post) should be part of market making, I'm afraid. As for items "a" and "b", those are the sorts of things that bring my Profits to over and above my target to ensure my bonuses are beyond any doubt. No percentages can ever be applied to that, therefore my original answer of not including "other" stands.

Sorry, mate. In the markets, you don't make the rules.

Quoting dns_di
@skenobi Was the size of your bonus dependant on your performance, if yes, how?
Yes.

How? If you make X amount of profit, you get Y amount of bonus. It's that simple. Were you expecting a complicated answer?
I'm not trying to convince anyone. I'm not in the "convincing" business.
  • #480
  • Edited 7:43pm Jul 6, 2014 7:27pm | Edited 7:43pm
Quoting Naokia980
Do your clients want to trade currencies for profit or hedge? Can you divide customers percentage for their goal in trading?
Quoting FlashCall
{quote} Whats the difference?
Exactly. What IS the difference? And in what way does knowing the percentage help make money in any way, shape, or form?

Anyways, to answer the question directly: We have clients (or customers) and we have counterparts (Other Banks). Customers want to hedge; Counterparties want to profit. I don't have percentages for you and see no further point in even knowing them as the effects on the markets (as indicated by support and resistance) is the same.

Quoting Stinky
Hi skenobi and Jacob. I was just wondering if you would know why any given forex pair almost always returns to any given price level within a short period of time, e.g. a few hours to five days?
That's a leading question i.e. it assumes that the original premise (that pairs will frequently return to given price levels within a short time period) is true.

I prefer not to answer leading questions, and in any case, I don't even think the premise is consistently true.

It's just like playing backgammon against a seemingly cheating computer: you always wonder why the computer seems to get good doubles while conveniently forgetting that the computer gets some pretty useless doubles themselves half the time; consequently, you always remember the bad throws you got, while conveniently forgetting the good doubles you DID in the end-games.

What I'm trying to say is this: your original premise is not always true. But if you can prove that premise (that pairs will frequently return to given price levels within a short time period) and have the statistics to back it up, why not use those statistics to help you make money instead of asking "why"?

Quoting FlashCall
{quote} Im not getting this - why would corporates would be in the market (hedging?) during news? But anyway...never mind...its not really important...
I'm not trying to convince anyone. I'm not in the "convincing" business.
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