Broker Complaints …Get over it!

All you have to do is get a quality independent data feed and watch that with your broker's. They are usually within a couple of pips and suddenly there's a 20-30 pip spike. What do you think they're doing? Taking out stops, that's what. And most brokers do it, it's not like a couple of bad apples in the barrel, it's more like a barrel of bad apples with a couple of good apples.

I don't care about variable spreads, etc. I am not a news trader - I like positive expectancy. I won't, however, tolerate 30+ pip stop hunts. That's just bad business.

All brokers don't have spikes that take out your stops. I use TradeStation and eSignal (esignal has the ability to monitor over 50 data feeds) and those spikes don't occur with larger, reputable brokers.

Stop hunting has occured in markets for over a century now. You make it sound like it's a new concept. Maybe you shouldn't put your stop where everyone else does.

"Always drink upstream of the herd"

The whole point of this thread was to help some realize that they will never be successful as long as they sit around bitching about their broker. Get a new one or deal with it. There are plenty of discussions about various on this board. Everyone crows about the variable spread. My point is that maybe it wasn't such a hot idea afterall.

The thing is, On a stop hunting expedition, the broker cannot hold the price there for more than a micro second or there would be wicked arbitrage. So, Do not place stops on the broker's server.

Edit,

In fact why not hunt the broker? Put you limits on the Broker's server, but not stops that become market orders at the next best price...

I've been doing this for months now. I only place my profit targets on there.

Stops and limits are actually treated the same. If the broker hunts, he'll take out limits as well as stops.

It does feel a lot like fishing, doesn't it, Scott? You get into a decent trade, and watch the price meander down to where your target is and then "pop"...hooked me a winner...10-pip open mouth short right there, baby!

Yea, you and have been thinking alot alike lately... LOL, Scott

It is almost like some sort of fishing net isn't it?

Hello mrmikal,

For me, and I assume for alot of other people who are taking issue, it is not ok for brokers to do whatever they want. It is not "what the market will bear". There is a point when broker activity becomes fraud. You know, plain old lying cheating and stealing.

To all others,

In the end, if regulators finally come in and kill our leverage and margins and makes us like futures, it will not be because of complainers. It will be, because upon review, Forex is being run too much like a gambling sites. Prices too vaguely based on the market to be considered investing or trading. Where contracts specifically state the "the house" is counteparty to all deals and all deals will be settled based on "the houses" data. All of the other markets have a central clearing entity and, therefore, can be verified in any dispute.

Forex is awsome, it pays all my bills, I would hate to have to make the adjustment to futures or even equities. But, when a broker can make up their own spreads, spike stops, hold prices until the market suits their position again, it is not trading. If they are claiming that you are trading the forex market, then these activies are fraud by definition. If they are saying that your agreement them allows them to "make the market" that you are trading in, then it is not Forex at all, it is a gambling site by definition. This is the legislators and regulators problem with Forex. And, unfortunately they are right. The only way to defeat the legislators arguement is to make it so that a broker cannot control the data that you trade by. Have a 3rd party supply the data with total transpearancey and have the trader and broker agree to that data source. That would immediately eliminate all of the lying, cheating and bull crap.

The thing that gets me about this debate is the flow of people who rush in to complain about the complainers. Why? Really ask why? People only do things because they are getting some type of reward for it. Be it tangible or just emotional. When you see a thread, you know what it is about. If it is a thread about broker complaints, and you have no interest in that, what motivates you to log in and tell all of these people how you hate their complaints? Each individual can only answer - why?

The point I will make, AGAIN, is that swing traders and position traders are not as immediately affected by this debate. They think they have no stake in this debate, that they are not injured so no one else should complain. They are not quite right. If people don't fight this activity closely, eventually the problem will get big enough to hurt them too. Short term traders are all about this debate. Why? Because it affects them seriously and immediatley. Long term traders that don't want help should not. But, don't try to kill the argument because you don't want to hear it. Long term traders do have a stake in this rather they want to hear it or not.

Short term traders sharing their experience with broker during changing times is essential. It is crucial for us to help each other find a better situation. If you are a longer term trader and you think short term traders are wrong, foolish, stupid or whatever, that is fine. Just don't dilude yourself into thinking that none of us are making a good living at it. And, please, don't try to stop us from holding the liars, cheats and theives accountable. In the long run you will thank us.

I guess I have been lucky. I was with forex.com and they were fair, but I wanted interest paid on my unused margin so I switched to Oanda.

They do what they have to do to make money. I think they are all still trying to figure out how to manage news scalpers successfully (by succussful, of course i mean they get their usual commission). They are NOT going to let you play forex and make money at their expense. If they do, they will fail and you will wind up with a Refco type situation where your account is worthless. So, your broker better be successful or you will never see any money from your account... should you be able to grow it successfully.

I have found Oanda's response to news scalping interesting. Currently, they seem to be making the spread really wide right at the release and then decreasing the spread significantly after the 1st crazy 5-10 seconds. The spread then slowly returns to "normal" as the frenzy calms down. That approach makes sense to me because the brokers cannot afford to allow masses of uneducated traders making money by straddling. I don't think "they" are out to get anyone. I think they run a business where only the cream of the crop traders can profit and the rest of the whining, cry-baby, losing traders foot the bill (traders like myself).

I am striving to be successful and not whine too much. The news releases reminds me of a old war movie demonstrating the start of a battle. The first ones engaged in combat are the pawns and they are there to be sacrificed.

Summary, don't blame your broker if you chose to be a pawn. But, I really have been fortunate because apparently Forex.com and Oanda are run by reputable people as far as I can tell. There is not much regulation in this market so do your homework before you choose a broker. I'm a noob, but I was smart enough to call Federal Agencies in USA and Canada to make sure these brokers were for real. Anyway, I hope to obtain a promotion from my current pawn status in the next year or so......... I think Sergeant's never have to replenish their accounts, so I will shoot for that next.
yours truly,
pawn#901,874.

Yes, i think also that there should be a better regulation of forex brokers. It is so necesary, i think.

I don't know exactly how the market works, in all the details. I try to guess, that's it. I don't think having a 3rd party for feed it's a good idea. You cannot force a broker to fill your orders if there are no liquidity. You cannot force somebody to sell you if he doesn't want. Or to buy from you. They should be forced to fill your order if there is liquidity.

I don't think the situation is so simple, but i don't think the brokers should do whatever thay want because of lack of good regulation. It's not normal. We don't need all the 2 employees brokers with the office on the back of a trunk, we need a couple of strong brokers, who are fairly regulated.

If you think your broker is screwing you then register a complaint with the NFA. I looked up the link for you: http://www.nfa.futures.org/dispute/arbCustomer.asp

If you want to check the reputation of a broker before sending them your money then you can use the same resource. I looked up that link for you as well: http://www.nfa.futures.org/basicnet/

Brokers are registered FCMs and as such are required to comply with NFA and CFTC guidelines as well as participate in routine audits.

Forex is a global market and as such the mysterious "regulators" can't dictate to the world how to behave. The CFTC renewal bill is before Congress now (it's a year overdue) and if you wanted to read it I am sure that you could find it online or via your local congressman.

I doubt that crying on FF will do you much good unless Merlin is running for congress.

I am also a full time trader. I maintian a mix of short and long term strategies so I'm not buying your story of how you are a victim because you are short term trader.

As for complaining, I started the thread. As far as I know I have every right to complain. If you want to complain about me complaining about people's complaints start your own thread.

I would like to complain about your complaining about people's complaints about complaints in this thread... No wait, I mean complaining about complaining.... No wait, Oh I am so confused.... LOL

Scott

FXO,

Length post, but I respectifully will disagree with most of it. There is nothing wrong what you're saying. I see where you're getting to...unfortunately you're thinking too much like a customer. You want to be serviced. What you claim is fair IS fair from a customer's point of view...but it is an idealists point of view. Brokers aren't here to serve us. Short, long, medium, whatever...

Personally, I'm actually an extremely short term trader. I trade news and breakouts about 60% of the time. Otherwise, I'm following a trend or carrying a trade or whatever...but the good majority of the time, I'm trading short term bursts, so I have to deal with slippage and spreads and everything that you have to deal with too.

Forex regulation is an inevitability only when it becomes a mainstream stay in human investment circles. The players in forex are so ginormously huge and retail forex is such a miniscule piece of the pie that regulation is a ways off no matter how many people get "screwed". Trust me, when mary jo average starts hedging her 401K portfolio with currency crosses...that's when the regulators will step in. People who invest in currencies do so because they are totally nuts! :-) Forex is built for much larger currency positions than what retail traders play. For that reason, retail forex investing is super high risk...super high risk will always keep the smaller players out...because in hold'em...the short stack has a disadvantage.

Look, what your saying is valid from a customer service point of view. However it makes very little business sense when your business is to try and milk as much money from the total market as possible. These markets aren't like grocery stores where you expect to have people bagging everything for you...this is a "better have an edge or die trying" market...absolutely the most cut-throat form of capitalism there is.

Share your experiences with your brokers is fine if it's NEW information. The same rehash on widening spreads from a variable spread broker just makes no sense...that horse is dead and decaying right there. There should be no more mention about slippage because, it happens with regularity...

I think what makes MORE sense is for people to share positive experiences with their brokers...like "I was in a bad trade, but my broker told me to get out before the bottom hit. That was gee-golly-good of the bloke." or "I don't think XXX has much slippage during NFP, anyone else confirm that?". If we're trying to find diamonds in the rough, then by all means, f-cking tell me about the diamonds!!! I don't need more info on the dirt.

The other thing that negative press tends to do is self-replicate and project onto otherwise normally successful traders. As an example, trader A is doing just fine with XXX broker. trader B has a bad trade due to slippage and bitches on the forum. However, trader A was doing just fine...so now after reading the negative post, doubts start to creep into the head of otherwise successful trader A. "Is my broker cubic zarconium?".

And I know it's easy to say, "well, we're protecting other people"...and to an extent that may be true, but how does everyone know that? Of all the complaints that I've ever read about any broker on this forum and others, I've only found 1 justifiable complaint that was actual broker misconduct. The rest were people simply not researching better options on their own...not so much that the broker did anything wrong (from a business stand point), but that the user was unaware of BETTER alternatives...and that's what we need BETTER alternatives, not more complaints. Telling me that my broker is bad does nothing to solve my situation. Tell me what broker I SHOULD be with and that info is MUCH more valid...wouldn't you agree?

That's hilarious! Complaint accepted.

some of us have tooooo much free time

phil i just got around to reading this most excellent post (thanks for breaking your resolution!). all this broker bitching is a result of newbies not understanding the game, and you have shed some light for those who wish to understand a little better...

This is true...I'm going to start charging you all for my time.

:

absolutely right on with this whole post.

and for those that dont already know, you need to be with MANY brokers! trading with one broker puts you at a serious disadvantage!

I'm gonna write up a market microstructure article tonight that explains in detail why spreads get widened and orders get slipped. I think it would help the misguided noobs understand things better.

If its good maybe my buddy Merlin can sticky it somewhere.

yeah, we are opening a Broker Bitching forum very soon, i will stickie this and your article in that forum.

thanks much this is a great idea!

just understand how your broker runs business and adjust accordingly

I think this broker discussion is crazy. Retail mms like Oanda, GFT, FXCM etc etc are all pretty much the same thing. If you trade long term positioning or trade anything outside of volatile times they are fine. They give you tools, analysis, charts etc to use. They want your business if you trade anything but news. They may make something when you lose... they make something when you win by getting the spread difference.

If you trade news get with an ECN or some bigger broker that will let you trade with them. If they requote you leave and try a new one.

As for "news trading died two years ago"... that is pretty much the most useless comment I have seen on this board. Just because brokers dont honor stoplosses like they used to you .. is that reason to just give up and throw in the towel? So you can't straddle... go out and get a news service like Reuters and practice your reflexes. I know a guy that trades with HotSpot FXI and trades news at a minimum of $1000/pip. BS news trading is dead. His account is well into the millions and he makes or loses $50k on NFP trades. Can I tap into this? no.. because there is no way I can scrape together 500k - 1 Million dollars to open an account. Until then I got to stick with ECNs or other brokers and work my way up.

Retail mms will do what they need to to make money. The same as any other company. Except car manufacturing companies of course : ).