ASK ME ANYTHING: Hoping to Help!

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Old Oct 13, 2016, 9:10pm   #31
 
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if it was just random tom, i'd be up 3 ticks and down 3 ticks 50/50...but not like that,

as soon as i place the trade i'm out a tick or 2 immediately, never up a tick or 2 right away..

i have to grind those out

you don't see this too!!??
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Old Oct 13, 2016, 10:39pm   #32
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if it was just random tom, i'd be up 3 ticks and down 3 ticks 50/50...but not like that,

as soon as i place the trade i'm out a tick or 2 immediately, never up a tick or 2 right away..

i have to grind those out

you don't see this too!!??

I'm not saying its random, but at close range to a current price there are only so many levels at which to place a rational stop. Its because traders don't randomly place stops that the market trades to trigger it. After all, even the stop-placer must have thought there was a reasonably foreseeable possibility of that price being hit, or why place it there? You cannot think that one broker, yours, could/would wish to move an entire currency market to hit your unique trade stop?
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Old Oct 14, 2016, 9:06am   #33
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Originally Posted by piphoe View Post
if it was just random tom, i'd be up 3 ticks and down 3 ticks 50/50...but not like that,

as soon as i place the trade i'm out a tick or 2 immediately, never up a tick or 2 right away..

i have to grind those out

you don't see this too!!??
why don't you collaborate with a friend who has another account at the same firm and compare rates once you're in the position whilst your friend remains flat. if you buy EUR/USD for example at 15 and your friend still see's 14-15 still but you see 13-14 you will know the broker is applying some price bias to your account.

At least you will know for sure whether your broker is stitching you up.
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Old Oct 14, 2016, 9:20am   #34
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. . . At least you will know for sure whether your broker is stitching you up.
Hi highbury fx,
Do brokers do this on an account by account basis? If so, is the practice widespread or confined to just one or two? If the latter, would you care to say which ones?
Tim.
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Old Oct 14, 2016, 9:23am   #35
 
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why don't you collaborate with a friend who has another account at the same firm and compare rates once you're in the position whilst your friend remains flat. if you buy EUR/USD for example at 15 and your friend still see's 14-15 still but you see 13-14 you will know the broker is applying some price bias to your account.

At least you will know for sure whether your broker is stitching you up.
Pip and friend
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Old Oct 14, 2016, 9:37am   #36
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Hi highbury fx,
Do brokers do this on an account by account basis? If so, is the practice widespread or confined to just one or two? If the latter, would you care to say which ones?
Tim.
hi Tim

I've not seen it at the 3 spreadbet/cfd brokerages I've worked at although I did suspect it was happening to an account I used at a swiss broker back in 2004. I'd be surprised if it happens at any fca brokerages today but I wouldn't be surprised if it happened at brokers regulated in less stringent jurisdictions as it's an easy bit of code to write.

its very simple to see if its happening to you.. just compare 2 accounts, 1 in a position and 1 not in a position.

what probably is more prevalent is the automatic applying of arbitrary slippage on orders. that's more of a widespread problem i'd imagine and has the same result as price bias in terms of paying away unnecessarily pips.
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Old Oct 14, 2016, 11:06am   #37
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So if a stop on a long is hunted by your broker, but the market's still rising, why not get in a new long at the stop price?
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Old Oct 14, 2016, 11:18am   #38
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So if a stop on a long is hunted by your broker, but the market's still rising, why not get in a new long at the stop price?
pardon? if you're long and the market is rising your stop is not in danger.

price bias isn't just about hunting for stops, its a cheap trick to make you pay more spread on your exit. if you buy on a 13-15 price and they immediately move it to 12-14 they've effectively widened the spread on you.
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Old Oct 14, 2016, 11:27am   #39
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pardon? if you're long and the market is rising your stop is not in danger.

price bias isn't just about hunting for stops, its a cheap trick to make you pay more spread on your exit. if you buy on a 13-15 price and they immediately move it to 12-14 they've effectively widened the spread on you.

Surely you wouldn't buy at 15 and put a stop at 12?

With regards stop-hunting, there's no point me arguing that something can be done and how its done when it doesn't exist. I accept brokers' spreads do widen during the day but this is according to the level of risk they're carrying, there's no hunting going on here. We know this happens, and the people who get hurt are the traders who fail to allow for price noise.
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Old Oct 14, 2016, 11:35am   #40
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Have you seen the spread widening on FXCM on a Friday night and early doors on a Sunday? And don't forget the 10pm close every day - ridiculous ! The brokers seem to claim it's nothing to do with them and more to do with their liquidity providers (the banks).

My opinion is this is one of the tricks that ensures that most Forex retail traders lose. I'm not sure if it's happening with equities though.
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Old Oct 14, 2016, 11:41am   #41
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Surely you wouldn't buy at 15 and put a stop at 12?

With regards stop-hunting, there's no point me arguing that something can be done and how its done when it doesn't exist. I accept brokers' spreads do widen during the day but this is according to the level of risk they're carrying, there's no hunting going on here. We know this happens, and the people who get hurt are the traders who fail to allow for price noise.
Hi Tom

plenty of people buy at 15 and put stops at 12, even closer but price bias is more about increasing spread in an unfair way rather than stop hunting, which you're right, is not a problem in retail fx.

just like automatically adding a pip slippage to all stops, price bias is a way of brokers eeking out more spread from clients. it's a sly and slippery way of making pips and if the fca saw it happening to an fca broker they wouldn't be happy. TCF is about making all clients the same price and giving all clients the same opportunity, if you're waiting until clients are in a trade before weighting the market specifically against them it isn't TCF.
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Old Oct 14, 2016, 11:41am   #42
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Have you seen the spread widening on FXCM on a Friday night and early doors on a Sunday? And don't forget the 10pm close every day - ridiculous ! The brokers seem to claim it's nothing to do with them and more to do with their liquidity providers (the banks).

My opinion is this is one of the tricks that ensures that most Forex retail traders lose. I'm not sure if it's happening with equities though.

No it is not, it is just rigorous risk management - something beyond most retail traders. Most of whom just read the headline blurb -
1pt spreads! open an account today!
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Old Oct 14, 2016, 11:45am   #43
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Hi Tom

plenty of people buy at 15 and put stops at 12, even closer but price bias is more about increasing spread in an unfair way rather than stop hunting, which you're right, is not a problem in retail fx.

just like automatically adding a pip slippage to all stops, price bias is a way of brokers eeking out more spread from clients. it's a sly and slippery way of making pips and if the fca saw it happening to an fca broker they wouldn't be happy. TCF is about making all clients the same price and giving all clients the same opportunity, if you're waiting until clients are in a trade before weighting the market specifically against them it isn't TCF.

Buy at 15, place a stop at 12 and its goodnight vienna. Just asking for it.

I am sure all a particular broker's clients do get the same price (unless they're mega-bucks players, but they will know about that if that's the case).
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Old Oct 14, 2016, 11:55am   #44
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No it is not, it is just rigorous risk management - something beyond most retail traders. Most of whom just read the headline blurb -
1pt spreads! open an account today!
100% right.. widening spreads in illiquid markets is good risk management for us brokers.

if you're an STP firm you have no option but to widen the spreads if your liquidity provider has widened their spreads. B book brokers however will have the choice to remain tight.
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Old Oct 14, 2016, 12:00pm   #45
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Buy at 15, place a stop at 12 and its goodnight vienna. Just asking for it.

I am sure all a particular broker's clients do get the same price (unless they're mega-bucks players, but they will know about that if that's the case).
I wouldn't be so sure they all get the same price. as far as the fca is concerned they most certainly should all be getting the same price.

big clients we'd tend to have a direct relationship with and have an agreement about how many fractions of pips we can take from their fills. B book firms with big clients who are hopeless will just go on to their normal risk limits and wont be hedged unless their deals bust exposure limits. STP firms back everything off and big clients their will less likely have leverage to demand better conditions.
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