DislikedSome brokers simply don't give a shit. Playing with prices and spreads is a huge "no no" in this business, and regulatory bodies, and audits exist to make sure that that isn't happening. FXCM has been fined in the past for this, so at least there is some oversight. (no this is not an invitation to open the debate about regulation). Whether the spikes in this case are driven by FXCM or legitimate pricing errors, I can't say.Ignored
Furthermore, FXCM has not been fined for "playing with prices and spreads". We have offered NDD forex execution since 2007, and client orders have been offset one-for-one with our liquidity providers since that time. The settlement with the NFA was for positive slippage that was not passed on prior to 2010. FXCM reimbursed current and former clients who were affected in full. Furthermore, the changes we made in 2010 means that since then, FXCM has passed on positive slippage on all order types including market and limit orders.
It's important to note that to this day, some brokers may still not provide positive slippage to their clients, while others may provide positive slippage on some order types, but don't provide it on other order types. Still other brokers will re-quote their clients when the price moves in their clients' favor but fail to re-quote when the price moves against them.
By contrast, there are no re-quotes at FXCM, and our clients receive the full benefits of any positive slippage that's available.
Below are the data from a total of 43,128,901 trades executed through FXCM over a six month period from August 2013 to January 2014. In those 6 months alone, FXCM clients benefited from over $15 million in positive slippage.
- 73% of all orders had no slippage.
- 15% of all orders received positive slippage.
- 12% of all orders received negative slippage.
- Over 60% of all limit and limit entry orders received positive slippage.
- 53.32% of all stop and stop entry orders received negative slippage.
Notice how positive slippage is more common with limit orders, while negative slippage is more common with stop orders. That's due to the momentum of price movement when such order types are triggered. It's worth noting that the Market Range feature on our Trading Station platform and the Enhanced* Maximum Deviation feature on our MT4 platform allow FXCM clients to limit the amount of negative slippage they receive, while still enjoying the full benefits of any positive slippage that's available.
* On the MT4 platforms of some other brokers, the Max Dev feature is unavailable, or if it is available, then it will limit both your negative slippage and your positive slippage equally. By contrast, FXCM enhanced how Max Dev works on our MT4 platform allowing you to limit your negative slippage while still enjoying the full benefits of any positive slippage.
