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Broker reverses $20K winning trades for alleged latency arbitrage

  • #201
  • Oct 29, 2014 10:10pm Oct 29, 2014 10:10pm
Quoting yunben
{quote} To be frank, I use copy trade in this account. I trade in other account and this account will copy my trade. I noticed my other account is making money. but this account is still losing. I do add more size to trade in this account. But it basically follows my strategy as the market condition gives overall buy signal . No matter what happens I will trade like that at that time.
Yunben - It seems to me that you shot yourself in the foot here, with this statement. You are deliberately using price latency to your advantage, which is against their rules. Correct me if I am wrong, but you are placing your trades with a different broker and then you have those trades automatically mirrored within a forex..com account. You probably figured out that your other broker has a slightly faster feed and forex..com has a slower feed at certain times....it seems that you are certainly engaging in price latency arbitrage...and now you are upset because you got caught. Tough luck I suppose.
  • #202
  • Oct 29, 2014 10:21pm Oct 29, 2014 10:21pm
Quoting NorthShore
{quote} Yunben - It seems to me that you shot yourself in the foot here, with this statement. You are deliberately using price latency to your advantage, which is against their rules. Correct me if I am wrong, but you are placing your trades with a different broker and then you have those trades automatically mirrored within a forex..com account. You probably figured out that your other broker has a slightly faster feed and forex..com has a slower feed at certain times....it seems that you are certainly engaging in price latency arbitrage...and...
This strategy that you mention has both positive and negative results.
So why cancel only the profitable trades and not the loss trades???
Striving to Develop & Implement Innovative Ideas
  • #203
  • Oct 29, 2014 10:22pm Oct 29, 2014 10:22pm
Quoting yunben
{quote} 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...
Yes they can certainly take it away, you have to play by their rules - and again, these are ill gotten gains according to their fine print - you discovered a way to profit using price latency arbitrage. Rules are rules right?
  • #204
  • Oct 29, 2014 10:27pm Oct 29, 2014 10:27pm
Quoting New-Pragati
{quote} This strategy that you mention has both positive and negative results. So why cancel only the profitable trades and not the loss trades???
They probably noticed certain patterns within the account, researched what was going on, figured out that he was breaking the terms of service, seized the ill gotten gains, and then kicked him out. If you lose money by cheating, the casino doesn't care. If you win money by cheating, the casino will certainly care, and they will take your winnings, and they will kick you out. Dealer, brokers, casinos, etc.. all operate like this. Its common sense business practices for them. I am not picking sides...I am simply observing their style of logic.
  • #205
  • Oct 29, 2014 10:27pm Oct 29, 2014 10:27pm
Quoting NorthShore
{quote} Yunben - It seems to me that you shot yourself in the foot here, with this statement. You are deliberately using price latency to your advantage, which is against their rules. Correct me if I am wrong, but you are placing your trades with a different broker and then you have those trades automatically mirrored within a forex..com account. You probably figured out that your other broker has a slightly faster feed and forex..com has a slower feed at certain times....it seems that you are certainly engaging in price latency arbitrage...and...
forex-com infrastructure must be really bad if a lay person manages to outrun and outdo them.

is everyone supposed to have the same price? prices for the same thing do vary a little between banks/suppliers.

is forex-com broker or a casino? casinos are known to ban players who outdo the house.
  • #206
  • Edited Oct 30, 2014 1:41am Oct 29, 2014 10:35pm | Edited Oct 30, 2014 1:41am
Quoting NorthShore
{quote} Yunben - It seems to me that you shot yourself in the foot here, with this statement. You are deliberately using price latency to your advantage, which is against their rules. Correct me if I am wrong, but you are placing your trades with a different broker and then you have those trades automatically mirrored within a forex..com account. You probably figured out that your other broker has a slightly faster feed and forex..com has a slower feed at certain times....it seems that you are certainly engaging in price latency arbitrage...and...
Hi, Northshore:
Did I say forex.com mt4 can stuck for one minute sometimes? their price feed surely can be different by 2-5 pips from other brokers due to just a second different when price was moving very fast. This is not the first time I met this problem. So with a large trading size, you will see the trade different. one account make $500, but the other lose $1000, I increase my trading size just follow my strategy it is still within my control with my account fund. Under the indicator condition and my judgement is that it is a small market clash, it will revert soon. the over all is a buy signal from my strategy at the price spike. The USDCHF price reversed about 100pips in 15 minutes. I've been trading this way for a thousand of times.
as you see their latency cause me lose and profit as well. I am not trying to make use of it deliberately. You know if you try to make use of it, it could be very dangerous, right? meanwhile It is very doubtful, a specialized broker let a latency be over 12 minutes and do nothing.

my trades that day is not different from my previous short term trading style except the size 2-3 times larger. They should tell the regulator what the unusual trading style it is. Is the trade not possible made by an experienced and profitable trader? I don't understand how they say it is illegal.

I still insist if they say there is price latency, they should make open announcement. let all know it at least. not the way just reverse profits only in private manner.
They can be frank because my server failure, all trades are invalid. but you see, there is not even a word. this is surely not the respectful and acceptable way they can solve the problem.

I check Adal's chart, even if they use raw bank data, my overall buy strategy should be still roughly successful, it couldn't be losing at the moment even I trade with forex.com platform using other broker's price feed. This means the 19276.33 is indeed almost all trade profits taken by them.

If they can take away all profits away during the latency and left all losses, and support they were trading with you as a casino does, they will definitely benefit from the latency without risk.
  • #207
  • Oct 29, 2014 10:49pm Oct 29, 2014 10:49pm
Quoting NorthShore
{quote} They probably noticed certain patterns within the account, researched what was going on, figured out that he was breaking the terms of service, seized the ill gotten gains, and then kicked him out. If you lose money by cheating, the casino doesn't care. If you win money by cheating, the casino will certainly care, and they will take your winnings, and they will kick you out. Dealer, brokers, casinos, etc.. all operate like this. Its common sense business practices for them. I am not picking sides...I am simply observing their style of logic....
I understand what you are trying to say but please do understand that there are regulators to see the difference between right and wrong.
Latency has advantage and disadvantage to both brokers and traders. So if latency is used by brokers for their benefits then they will have have to accept losses also.
If they don't want to accept the losses then they should not accept the profits also.
FXCM were fined by 2 regulators for not passing latency advantages to customer and only passing the disadvantage to customers.

http://www.cftc.gov/PressRoom/PressReleases/pr6119-11

http://www.fca.org.uk/static/documen...t-watch-45.pdf
Striving to Develop & Implement Innovative Ideas
  • #208
  • Oct 29, 2014 11:30pm Oct 29, 2014 11:30pm
Quoting NorthShore
{quote} They probably noticed certain patterns within the account, researched what was going on, figured out that he was breaking the terms of service, seized the ill gotten gains, and then kicked him out. If you lose money by cheating, the casino doesn't care. If you win money by cheating, the casino will certainly care, and they will take your winnings, and they will kick you out. Dealer, brokers, casinos, etc.. all operate like this. Its common sense business practices for them. I am not picking sides...I am simply observing their style of logic....
Than forex.com should apply gambling license from gamblingcommission and not hide on fca license to make this kind behavior.
  • #209
  • Oct 29, 2014 11:33pm Oct 29, 2014 11:33pm
Quoting yunben
{quote} Hi, Northshore: Did I say forex.com can stuck for one minute sometimes? their price feed surely can be different by 2-5 pips from other brokers due to just a second different when price was moving very fast. This is not the first time I met this problem. So with a large trading size, you will see the trade different. one account make $500, but the other lose $1000, I increase my trading size just follow my strategy it is still within my control with my account fund. Under the indicator condition and my judgement is that it is a small market...
may be they make profit from latency? may be they take advantage from latency.... will u let a BIG HOLE infront your door if it not for your purpose?
No Pain, No Gain
  • #210
  • Oct 29, 2014 11:38pm Oct 29, 2014 11:38pm
Quoting Mingary
{quote} No corrections needed. You are absolutely correct. http://www.youtube.com/watch?v=-DT7bX-B1Mg
hilarious! thx!
there is always, always another trade!!
  • #211
  • Oct 30, 2014 12:25am Oct 30, 2014 12:25am
put this story on as many bb as possible. let us know and we will go there and support you.
  • #212
  • Oct 30, 2014 12:40am Oct 30, 2014 12:40am
Lets ignore the batty boys who are here to mislead us.
  • #213
  • Oct 30, 2014 12:42am Oct 30, 2014 12:42am
Quoting New-Pragati
We (traders/viewers/posters)may not know each other however we will oppose any wrong doing.
We can oppose all we want...

But let's be real here.

2 weeks from now, nobody will even post in this thread anymore because all that has been said is the same that has been said many times before. Next week, it will be somebody else, and the same thing will happen.

Check out the amount of threads on FF...

Now check out how many of them haven't seen the light of day for days, weeks, months and even years.

Sadly, this thread is destined to be another one of those. May get linked too, from time to time, might even see a few more dozen posts before End of Year. But that's it. Dude ain't getting his money back, no matter how much we post, nor how many times Jack pops back in for a visit. Truth be told, I am actually surprised it has carried on this long and would have probably met with a quicker fate if Jack hadn't bothered posting.

The real truth is...the big losers on this account seemingly are the manual trades...the winners are the latency exploits.

Check it:
26613020 2014.10.15 13:27:26 buy 0.90 usdchfpro 0.94410 0.93914 0.94714 2014.10.15 13:39:20 0.93950 0.00 0.00 0.00 -440.66
26613063 2014.10.15 13:28:02 buy 0.90 usdchfpro 0.94368 0.93864 0.94664 2014.10.15 13:39:21 0.93935 0.00 0.00 0.00 -414.86
26613077 2014.10.15 13:28:11 buy 0.30 usdjpypro 106.043 105.500 106.345 2014.10.15 13:39:33 105.525 0.00 0.00 0.00 -147.26
26613160 2014.10.15 13:29:57 buy 1.50 usdjpypro 105.910 105.431 106.231 2014.10.15 13:40:18 105.493 0.00 0.00 0.00 -592.93
26613200 2014.10.15 13:30:33 buy 0.90 usdjpypro 105.869 105.376 106.176 2014.10.15 13:40:18 105.498 0.00 0.00 0.00 -316.50
26613204 2014.10.15 13:30:36 buy 1.50 usdchfpro 0.94321 0.94180 0.94622 2014.10.15 13:34:07 0.94171 0.00 0.00 0.00 -238.93
26613265 2014.10.15 13:31:49 buy 1.50 usdchfpro 0.94331 0.94000 0.94626 2014.10.15 13:38:35 0.93999 0.00 0.00 0.00 -529.79
26613272 2014.10.15 13:32:06 buy 0.90 usdjpypro 105.886 105.366 106.166 2014.10.15 13:40:17 105.500 0.00 0.00 0.00 -329.29
26613371 2014.10.15 13:34:14 buy 6.00 usdchfpro 0.94156 0.93663 0.94463 2014.10.15 13:40:17 0.93879 0.00 0.00 0.00 -1 770.36
26613474 2014.10.15 13:35:58 buy 3.00 usdjpypro 105.761 105.262 106.062 2014.10.15 13:40:21 105.464 0.00 0.00 0.00 -844.84

These trades were open past what any Latency EA would allow for...these are the manuals...

His scrubbed trades were the ones that won by software.

Really, FOREX.COM, might in fact be another bullshit scumbag bucket shop broker...but they all carry the same rules about arbitrage...accounts will get adjusted, and closed...plain and simple.

Losses on manual trades were allowed to stand...and well they should.
Wins by cheats, were removed, most likely 100% in accordance with the agreement that is authorized upon opening an account.

Much as I love a good tussle...

This one ain't really gunna go no place.

Study the evidence behind the words...come to your own conclusions...may not be about FOREX.COM as a whole, but about this particular case, seems pretty clear cut to me.
Money Can't Buy Happiness. Poverty Can't Buy SHIT! You Choose!
  • #214
  • Oct 30, 2014 1:10am Oct 30, 2014 1:10am
Quoting Magix
{quote} We can oppose all we want... But let's be real here. 2 weeks from now, nobody will even post in this thread anymore because all that has been said is the same that has been said many times before. Next week, it will be somebody else, and the same thing will happen. Check out the amount of threads on FF... Now check out how many of them haven't seen the light of day for days, weeks, months and even years. Sadly, this thread is destined to be another one of those. May get linked too, from time to time, might even see a few more dozen posts...
who cares what you forex.con people have to say. get a life in prison.
  • #215
  • Oct 30, 2014 1:11am Oct 30, 2014 1:11am
why dont you guys use IG or CMC?
  • #216
  • Oct 30, 2014 2:08am Oct 30, 2014 2:08am
Angry!

even any one uses price latency as trading strategy, the broker should warn trader first.
because not everyone knows PRICE LATENCY is prohibition of your trading platform!

And if the broker takes the winning trades money of price latency, it should compensate traders who loses because of price latency!

If Forex.com does not list out/ make a pulic announce that they dont allow price latency as trading strategy
Yuenben, you should go to the court!
  • #217
  • Oct 30, 2014 2:15am Oct 30, 2014 2:15am
hey Ben yun,there something missing here:
1/ you said Forex.com disabled your account before could you tell us their reason? Or you have been use price latency to make money?
2/ you trade with 2 brokers at the same time and coppy trade, so why? Is that you trade with Duskacoppy,oanda,...broker have fast sever and even you know forex.com sever is slower, so you make money from their price latency? It doesn't make any sense that you have to trade with 2 broker at the same time if your trading strategy is profitable.
  • #218
  • Oct 30, 2014 2:57am Oct 30, 2014 2:57am
"Following is their client agreement specific clause"

Quote
Internet, connectivity delays, a
nd price feed errors sometimes create a situation where the
price displayed on the Trading Systems do not accurately reflect the market rates. The
concept of arbitrage and “scalping”, or taking advantage of these internet delays, cannot exist
in an over the counter market where the client is buying or selling directly from the market
maker. Gain Capital UK does not permit the practice of arbitrage on the Trading Systems.
Transactions that rely on price latency arbitrage opportunities may be revoked. Gain
Capital
UK...

The thing is that forex.com server accepts order then its displayed on client terminal , forex.com server matches it with ask and bid provided by the server and then technically should send order to bank or liquidity provider to execute that order , so there should be no question of lag and connectivity issue...

client sends order->
broker forwards it to bank->
bank/liquidity provider executes it->
server tells client order is executed->
client terminal then displays it----

now i cant understand how this whole process could be hijacked.
Price latency seems to a fake and lame excuse to rip client money.
  • #219
  • Oct 30, 2014 3:34am Oct 30, 2014 3:34am
Quoting denwabiz
{quote} Than forex.com should apply gambling license from gamblingcommission and not hide on fca license to make this kind behavior.
Even for casinos rigging their games in order to cheat is illegal.
  • #220
  • Edited 4:26am Oct 30, 2014 3:35am | Edited 4:26am
Quoting Abcxyz77
hey Ben yun,there something missing here: 1/ you said Forex.com disabled your account before could you tell us their reason? Or you have been use price latency to make money? 2/ you trade with 2 brokers at the same time and coppy trade, so why? Is that you trade with Duskacoppy,oanda,...broker have fast sever and even you know forex.com sever is slower, so you make money from their price latency? It doesn't make any sense that you have to trade with 2 broker at the same time if your trading strategy is profitable.

you have to put fund in different brokers in case they go bankruptcy. forex.com provided 3% interest for me. their CFD spread such as brent oil, US oil, is better than lmax.com. lmax allow minimum trading size of 0.2 lot for gold/silver, 0.01 for forex.com

I don't have to answer all your questions again and again. the trading is following my strategy. trading size is still within my control. my trading strategy give an allover buy signal. I took the risk to trade it. that's it. I am a profitable trader and I don't trade latency.
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