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Broker reverses $20K winning trades for alleged latency arbitrage

  • #41
  • Oct 24, 2014 9:46am Oct 24, 2014 9:46am
By coincidence a few days back I was reading about this. My luck that I have come across a real incident scenario.
This latency advantage is called 'sniping' and it is different from scalping. All brokers other than Fxopen (there may be other brokers I don't know) are prepared for this by adding a VDP (Virtual Desk plugin) to your mt4. This delays trade execution time. Don't know why this didn't happen with your trades.
Do go for legal steps and get your money back.
Striving to Develop & Implement Innovative Ideas
  • #42
  • Oct 24, 2014 11:49am Oct 24, 2014 11:49am
Quoting Kong
{quote} Well they have seized your profits on the grounds that you broke one of the clauses in the agreement you signed when you registered with them. If you can prove otherwise (that you were not profiting from price latency arbitrage) then you could take that to the authorities and hopefully recover your money. If you were profiting from price latency arbitrage (if this was your trading method) then unfortunately they are in their rights to do what they have done. I wish you the best of luck with it
IF the have the rights to seize profits from one type of trading, they would have the obligation to cover the losses on this same ground too!!!
Since they took all profit away but left the guy with all the trading losses for the same time,...now, that is a scam in my vocabulary!
there is always, always another trade!!
  • #43
  • Oct 24, 2014 1:09pm Oct 24, 2014 1:09pm
is forex.com a scam?

http://www.elitetrader.com/et/index....a-scam.173200/

http://www.forexpeacearmy.com/public.../www.forex.com

with so many bad reviews one has to wonder why anyone trades with them
  • #44
  • Oct 24, 2014 1:28pm Oct 24, 2014 1:28pm
Have you been aware that their system was lagged?

Out of interest i have plotted the best 2 winners and worst 2 losers on my charts. The winners are definitely off-market trades, and the losers would both be even 20 pips worse on real quotes.

What i find funny is that between about 13:35 and 13:50 you suddenly ramp up from sub 1 lot to trading 5 to 20 lot and making 95% of your Profits in 10 minutes (between 13:40 and 13:50). It looks a bit like you knew they had a lagged system and went in with bigger size to take advantage of that.

To me it now looks like that Gain thinks you deliberately tried to screw them over (if its true or not is anyones guess) and they are now screwing you back.
  • #45
  • Oct 24, 2014 1:42pm Oct 24, 2014 1:42pm
Quoting shrike
Have you been aware that their system was lagged? Out of interest i have plotted the best 2 winners and worst 2 losers on my charts. The winners are definitely off-market trades, and the losers would both be even 20 pips worse on real quotes. What i find funny is that between about 13:35 and 13:50 you suddenly ramp up from sub 1 lot to trading 5 to 20 lot and making 95% of your Profits in 10 minutes (between 13:40 and 13:50). It looks a bit like you knew they had a lagged system and went in with bigger size to take advantage of that. To me it now...

Please note my trading strategy is counter trend / bounce back/settles, pyramid 1min/5min. I did this way for over 4 years. You can check my other trade records. My trading style is consistent with previous records. my losing trades and winning trades are a series of my strategy. and the trading size is not excess for my fund.

They can suspect but if they want to take away fund, they need proof. Also they need tell all their server got problem sometimes and should cancel all trades during that period not just profiting trades. If they don't announce, it means they just make excuse.
  • #46
  • Oct 24, 2014 1:47pm Oct 24, 2014 1:47pm
Im just saying that is what gain is maybe thinking. Of course, even if true, the right thing to do would still be to cancel everything or nothing - and not beeing incompetent on the technology level in the first place.
  • #47
  • Oct 24, 2014 2:01pm Oct 24, 2014 2:01pm
Sorry to hear about this situation Yunben.

What strikes me as unusual that the broker is arguing that the latency problems only affected your profitable trades.

I never knew latency issues discriminated between profitable or non-profitable trades!

Best of luck and please keep us posted on the progress with how you pursue this.
Follow me on twitter @FxLester
  • #48
  • Oct 24, 2014 2:21pm Oct 24, 2014 2:21pm
Can i write my last post, some thoughts.

As shrike say:

"What i find funny is that between about 13:35 and 13:50 you suddenly ramp up from sub 1 lot to trading 5 to 20 lot and making 95% of your Profits in 10 minutes (between 13:40 and 13:50). It looks a bit like you knew they had a lagged system and went in with bigger size to take advantage of that."

Come on... they surely know how to do their job, and if they just catch you on your lag-trading.
As they say also:

"Gain Capital has conducted an audit of the trading activity on account 11112780. The result of this audit determined that the trading on 15 October 2014 was conducted on price latency arbitrage. In accordance of section 28.5 of the Customer Agreement you hold with Gain Capital"

The normal thing to do here would be (as it has been) to cancel your "illegit" trades, and of course them was all profitable trades.
I have a feeling that if they would have to correct also your losing trades, that would mean bigger losses for you, and NOT the refund of such losses.

You really need to keep it silent and just go on with your trading life, before they change their mind and start to check all and every trades that have ever been opened/closed in your account, and God only know what the results would be!

As someone once said: "don't wake up the sleeping dog"

(and let's not talk about the title of this thread, "robbed all profit left losses")
  • #49
  • Edited 2:49pm Oct 24, 2014 2:39pm | Edited 2:49pm
Quoting tunera
Can i write my last post, some thoughts. As shrike say: "What i find funny is that between about 13:35 and 13:50 you suddenly ramp up from sub 1 lot to trading 5 to 20 lot and making 95% of your Profits in 10 minutes (between 13:40 and 13:50). It looks a bit like you knew they had a lagged system and went in with bigger size to take advantage of that." Come on... they surely know how to do their job, and if they just catch you on your lag-trading. As they say also: "Gain Capital has conducted an audit of the trading activity on account 11112780....
I dont think my strategy will lose at that moment. I am making consistent profits over years.
As I had said above, my other account is making money while forex.com loses, so I increase trading size. That's their latency problem. if I still make money even at the price latency period, they can't just simply rob it as punishment due to their server problem.
I don't understand why you don't call it rob. My account was making money, they simply take it away without reasonable or fair excuse. That is rob! They do have audit but their result is all in their own interests.
  • #50
  • Oct 24, 2014 2:57pm Oct 24, 2014 2:57pm
[quote=tunera;7822331]Looking your trades, many profitable ones was opened and closed within one minute, it is not hard to figure out that you was taking advantage of a latency/lag problem of forex.com. Surely you have read and agreed the various agreements at the time you opened yor account, and surely one agreement was that you will not take advantage of this sort of lag problems that may happen from time to time. To sum up, you have violated the agreement between you and your broker, and they closed your account. You are lucky that they give you back most of your money, the best thing you can do now is apologize with them and go find a new broker.[/quote

seems to me as people are saying if their is a problem all trades should have been closed , to me its a scam plain and sure if they had closed all trades then closed his account I would have been on there side BUT THEY DIDNT DID THEY
people leave, but this thread will go on for ever
  • #51
  • Oct 24, 2014 3:10pm Oct 24, 2014 3:10pm
It's a shame that there are still so many regulated brokerage that are doing this. Not sure if complaining works but have they returned back your remaining funds?
  • #52
  • Oct 24, 2014 3:19pm Oct 24, 2014 3:19pm
Excel says they didnt cancel all the profits. Gross win is $19751 and they deducted $19276. So it looks like $475 have not been canceled. Wondering why?
  • #53
  • Edited 3:39pm Oct 24, 2014 3:23pm | Edited 3:39pm
Quoting shrike
Excel says they didnt cancel all the profits. Gross win is $19751 and they deducted $19276. So it looks like $475 have not been canceled. Wondering why?
They only give me a total number. no detail trades. If they give, means there should be a duration when to when and must including profits and losses. However, no answer.

They seems notice this threads. hmm... I have warned them I will post. I will wait two days and reply them and stop posts here.
$20000 is not a small amount but I made more profits and surely will continue to make. I will not lower my head simply for that money.
  • #54
  • Oct 25, 2014 2:46am Oct 25, 2014 2:46am
Quoting yunben
{quote} They only give me a total number. no detail trades. If they give, means there should be a duration when to when and must including profits and losses. However, no answer. They seems notice this threads. hmm... I have warned them I will post. I will wait two days and reply them and stop posts here. $20000 is not a small amount but I made more profits and surely will continue to make. I will not lower my head simply for that money.
rights right,,,,, wrongs wrong in my book keep going mate all the best from Australia we on you side
people leave, but this thread will go on for ever
  • #55
  • Oct 25, 2014 4:08am Oct 25, 2014 4:08am
Quoting shrike
Have you been aware that their system was lagged? Out of interest i have plotted the best 2 winners and worst 2 losers on my charts. The winners are definitely off-market trades, and the losers would both be even 20 pips worse on real quotes. What i find funny is that between about 13:35 and 13:50 you suddenly ramp up from sub 1 lot to trading 5 to 20 lot and making 95% of your Profits in 10 minutes (between 13:40 and 13:50). It looks a bit like you knew they had a lagged system and went in with bigger size to take advantage of that. To me it now...
Hey Shrike, I understand your points, but my feeling is that even if he knew perfectly what he was doing, and knew there was a difference in quotes compared to the actual price, he is still right and GAIN is definitely wrong. This is of course if he didn't cheat one way or another (there was for example a few years back a modified MT4 version that made the system accept a transaction even when it was rejected with a requote).

To me the real question is: Were these quotes he executed his transactions on actually quoted by forex.com ? If yes, he is right. The broker has all cards in hand: They decide of the quotes, they decide to let you enter/exit or not, they decide the requote/slippage. So coming afterwards and saying: "Oh no, that does not please us, we cancel this (and of course only the winning trades)" is wrong.

If there was some differences compared to the actual price he legitimately took advantage of (without cheating), it may be some technical problem like you say, and then forex.com is 100% responsible and may need to find another area to work in. Unless it was maybe exceptionnal circumstances they can explain, apology, and cancel everything because of this really exceptionnal thing, but it doesn't look that's the case here. Or, maybe they were doing it on purpose because they were screwing some of their other customers by chasing some stops or things like this.

To me, market makers are 100% responsible of the prices they quote when someone execute a transaction on it. Don't offer a price if you're not ready to honor it. On our side, we can't cancel a limit order we put anywere when it was executed and it finally doesn't please us.

If you have access to forex.com feed and have time to check it: Were the prices of the trades you spotted actually quoted by forex.com ? If yes, I guess they won't cancel either someone else stoploss hit because of it ... If no, there was some trick somewhere.
  • #56
  • Oct 25, 2014 5:22pm Oct 25, 2014 5:22pm
look here:
Attached Image
Failure, is a wonderful teacher!
  • #57
  • Oct 26, 2014 6:35am Oct 26, 2014 6:35am
Quoting yunben
{quote} even as they said there is a price latency. it is their problem. I am executing my strategy and my trading is partially affected due to their latency. They can list what kind of latency it is. start from what time to what time and which trade got problem. Then I can argue with them. It is surely shameless for them to take all profits and left the loses. I am wondering if there is price latency, Can they publicize it so that all trader know it? there is no public notice from their website and it seems so weird only I have the price latency....
They are a broker and as such want the best of both worlds.
Come with me if you want to live....
  • #58
  • Oct 26, 2014 7:24am Oct 26, 2014 7:24am
Quoting mike1349
look here: {image}
wow.. is that for real ???
that's not an average widen spread..

i check the myfxbook profile,
http://www.myfxbook.com/members/yunb...1068882/655217

but the last activity ae years ago, a withdrawal
08.12.2013 09:45 Withdrawal -117328.00,
or he just put the wrong account ??
  • #59
  • Oct 26, 2014 7:29am Oct 26, 2014 7:29am
i swear some of you guys can't be traders, those are weekend spreads when market close, any real traders undwerstands this
  • #60
  • Oct 26, 2014 8:02am Oct 26, 2014 8:02am
Quoting fxindikator
{quote} wow.. is that for real ??? that's not an average widen spread.. i check the myfxbook profile, http://www.myfxbook.com/members/yunb...1068882/655217 but the last activity ae years ago, a withdrawal 08.12.2013 09:45 Withdrawal -117328.00, or he just put the wrong account ??
That's another account I ever with them. Because I make profit they closed my account. but all fund and profits got returned. There are a lot examples they closed profiting accounts by their compliance department. It means their compliance department wear the same trousers with for ex. Com. You complain to them is useless. Also it means they are your counterpart. You win means they lose.
this case account no. Is 11112780 this time they take away some profits back and ask me to withdraw the rest.
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