FXCM stoploss is dangerous.

alps007

Junior member
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Hi,

I have a spreadbetting platform with FXCM. Lately my losing trades have been getting stopped out with more pips then originally set. Today for example I was in a cable trade where I set a stop loss of 43 pips. The trade was a loser but I got stopped out at 55 pips loss instead of the 43 pips originally set.

Since this has been happening very frequently whereby FXCM stops me out by atleast 7 pips more then I had originally set on my EURUSD and GBPUSD trades I wonder if anyone else has been experiencing similar problems.

With the spread being around 3 pips for both pairs I would expect to be stopped out at no more then 2 pips extra of my original stoploss figure.

Losing over 7 pips more then what you originally set on a regular basis can be painful to one account.

Alps
 
happens when market is volatile, like yesterday around london close. I've also had problems where i will close a position and it takes 10 minutes to do so.
 
Hi,

I have a spreadbetting platform with FXCM. Lately my losing trades have been getting stopped out with more pips then originally set. Today for example I was in a cable trade where I set a stop loss of 43 pips. The trade was a loser but I got stopped out at 55 pips loss instead of the 43 pips originally set.

Since this has been happening very frequently whereby FXCM stops me out by atleast 7 pips more then I had originally set on my EURUSD and GBPUSD trades I wonder if anyone else has been experiencing similar problems.

With the spread being around 3 pips for both pairs I would expect to be stopped out at no more then 2 pips extra of my original stoploss figure.

Losing over 7 pips more then what you originally set on a regular basis can be painful to one account.

Alps

Hi Alps,

I understand you are disappointed with the execution of your stop loss; however, all stop loss orders are executed as At Best market orders. If there is no liquidity available at the price you requested, the order will be filled at the next best available price. Having an order execute during a volatile market conditions such as a news event could increase the likelihood of this occurring. Slippage is discussed in the execution risks section of the FXCM website http://www.fxcm.co.uk/trading-execution-risks.jsp .

With No Dealing Desk execution, FXCM is not making a market therefore does not control the execution of the trade. There are 10 banks providing liquidity and competing for orders. If liquidity at the bank quoting a particular price is no longer available, the order is sent to the bank providing the next best price.

Jason
FXCM

Jason
 
...it takes 10 minutes to do so.

Hi Alexbabwa,

This is not something which is normal. Please request a trade audit if this occurs and we will investigate whether an adjustment should be made due to a problem on our side.

Jason
 
I have a spreadbetting platform with FXCM.

Error number 1.


...Lately my losing trades have been getting stopped out with more pips then originally set.

Partial consequence of error number 1 above.


...Today for example I was in a cable trade where I set a stop loss of 43 pips.


Error number 2.


...The trade was a loser but I got stopped out at 55 pips loss instead of the 43 pips originally set.

Partial consequence of both errors number 1 and 2 above.


...Since this has been happening very frequently whereby FXCM stops me out by atleast 7 pips more then I had originally set on my EURUSD and GBPUSD trades I wonder if anyone else has been experiencing similar problems.

Yes.


...With the spread being around 3 pips for both pairs I would expect to be stopped out at no more then 2 pips extra of my original stoploss figure.

Error number 3.


Losing over 7 pips more then what you originally set on a regular basis can be painful to one account.

Indeed it can.


Now, a little bit of error fixing:

a) Run (don't walk) to a Retail Forex Intermediary with the most direct access to genuine Interbank rates that you can find. With a little homework, you will find them - they DO exist. You do not need a Dealing Desk and you most certainly don't need a Dealing Desk while messing around with SBs. This fixes Error Number 1.

b) Trading the Forex using Stops is one problem. Trading the Forex using 43 pip Stops compounds the error. GBP (on average) produces approximately 1.4 times the magnitude of EURUSD. If EURUSD moves 100 pips, then GBPUSD will typically (not always) move 140 pips. You can't just walk into this market and think that all currency pairs have the exact same price action dynamics - they don't. Think of the Forex pairs the same way you would a Baskin Robbins Ice Cream store. Each pair has its own flavor, its own price action tendency, its own range and magnitude.

The Forex is one of the most dangerous places for naked trading. Stop Hunting is real - don't let anybody tell you otherwise. Anytime a Dealing Desk can manipulate your position when your trade comes close to your stop without touching it, by "expanding the spread" through your stop location, that is considered a hostile trading environment for the uninitiated. When there is no Dealing Desk intervention, there is no implicit Stop Hunting by your Intermediary, though collective, the "Interbank Players" knows the location of Stop Cluster Levels.

To mitigate risk, get away from trading single pair positions, unless you have mastered the art and science of hyper-short-term Scalping. Learn for your self, how to stack the deck in your favor by using a Multi-Pair Position strategy that uses no visible stop and no immediately visible limit. Again, unless you are very adept at hyper-short-term Scalping, then you really should seriously consider being less of a Trader and more of a Money Manager across a Multi-Pair Position trade profile. How you go about doing that, is of course, up to you - as there are many ways to engineer such profiles. This fixes error number 2.

c) The market for SB is growing, but unless you like dealing on your Intermediaries deal book, then try sticking to the underlying unless or until this particular derivatives market shows that it is universally accepted as a prime derivatives market place. SBs and CFDs are NOT equity derivatives and the two should not be confused. FX is OTC anyway with a litany of bad price representation through unethical Intermediaries who target inexperienced traders. So, why take more systemic risk by trading either SB or CFD, where it is guaranteed that streaming prices AND spreads will be manipulated or stand the chance of being strongly manipulated. The first order of business of Risk Mitigation, which in this market niche means doing whatever you can to stack the deck in your favor. This fixes number 3.

If you are not a cold, calculated and highly disciplined Professional Scalper, then 43 pips on Cable is not even remotely functional. In fact, its is laughable. My Cable position just swung on my by 149 pips in less than 24 hours. If I was naked (a single pair) or had stop of 43 pips, I would have been eaten alive by now. Yet, I am still up 12 pips on Cable and averaging 52 pips in the aggregate through a Multi-Pair profile with no stop anywhere in sight.

Take the time to learn how to conduct yourself in this business and it can pay huge dividends for you in return. :)
 
Oh, and one more thing, Alps.

This entire notion called No Dealing Desk Execution is fine - I have no problem with that - that's the way it should be.

But, if anyone is quoting a fixed spread or guaranteeing you a tight spread, then by definition the price feed is being manipulated, pure and simple - no questions asked.

Price stabilization comes through adequate Volume, Alps. Don't let anyone tell you different. Volume comes through an aware market place and adequate Liquidity. An aware market place and adequate liquidity comes through the most basic concept of all: Supply and Demand. When supply increases, spreads should go down. When Demand increase, spreads should go up. This also helps to produce an efficient market.

Spread Betting was created for the Retail Market place, not Interbank Participants. Interbank pillars are not segregating huge liquidity for Spread Betting and the notion that they are is rather humorous. Banks, huge Institutions and some Model Funds use currencies to strike Compensating Balances against other non-currency related asset classes within their overall portfolios - respectively. The rest is genuine commerce and for profit transactions - including the Retail (for profit) segment - Traders like you and me.

Read the Triennial Central Bank Survey - Foreign Exchange & Derivatives Market Activity Report, to find out who is providing real liquidity to the FX market place and whether or not they are engaged in "Spread Betting" on any meaningful level (if at all). In fact, when you read the report, run a search on the words: "Spread Betting" and "Contract for Difference" and see what you come up with. Then run a search on: "Outright Forward," "Foreign Exchange Swap," "Currency Swap," "Currency Option" and "Currency Swaption."

Learn who the real players are and what they are doing.

 
happens when market is volatile, like yesterday around london close. I've also had problems where i will close a position and it takes 10 minutes to do so.

thats so scary....

do you realise how much money you can lose between those 10 minutes ?
 
Thanks for informing me about the 10min issue, pretty unbelievable. I have an account with FXCM and Gain if Oanda pulls the 10:1 stunt, at least I know where to go then after two months.
 
I should also say that has never happened again since, with no more than a 30 second delay now and then. It could of been a platform issue perhaps, that is what customer support told me at least.
 
When I went to an intro day at CMC ages ago, I clearly remember the presenter saying over and over again, use stops don't trade without stops.
His presentation was slick and flowing, when I asked questions at the end, the ummimg and urhing started.


Stops are essential when you are not trading against a bucket shop but if you are trading against the bucket shop you signed up with, then you are basically telling them at which price you want to be a sucker.

At that intro day at CMC the girl serving the tea was very pretty with huge breasts. What was that all about?
 
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Hi Alps,

I understand you are disappointed with the execution of your stop loss; however, all stop loss orders are executed as At Best market orders. If there is no liquidity available at the price you requested, the order will be filled at the next best available price.



Jason
FXCM

Jason

The trader was trading euro usd and cable, the most liquid currencies.Do you have liquidity problems on the majors?

If this continues , the internet will be full of hundreds of videos and threads like this about FXCM.

 
The trader was trading euro usd and cable, the most liquid currencies.Do you have liquidity problems on the majors?

If this continues , the internet will be full of hundreds of videos and threads like this about FXCM.



Jason i find myself in total agreement with odt. you cant be telling us that the market on majors frequently gaps through prices,surely not. I understand not being able to get a qouted price from time to time,but not a stop that is 7 pips adrift. Im sure that the price was traded at and therefore you are liable to pay at the correct stop. With so many markey makers what you have said is wrong and I ask for a more detailed explanation. Are you saying that in normal trading hours when volatile all the trading houses will have the same gaps?
 
The trader was trading euro usd and cable, the most liquid currencies.Do you have liquidity problems on the majors?

If this continues , the internet will be full of hundreds of videos and threads like this about FXCM.


WOW! Amazing – it's like a printing money business.

It would be a good idea to open a spread betting company. It seems like there are no rules and you can do as you are pleased.

Thanks ODT.
 
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WOW! Amazing – it's like a printing money business.

It would be a good idea to open a spread betting company. It seems like there are no rules and you can do as you are pleased.

Thanks ODT.

I have seen where the prices can be both a blessing and a curse from FXCM, sometimes traders gain a little sometimes they loose. Where I have a problem with FXCM is their support. case in point; my wife has a little micro account with them and one day a couple weeks ago (best i can recall) she clicked & placed a trade on the USD/JPY but the trade was placed on the EUR/USD. When she realized this she closed the trade for a minor loss.

She tried several more times and finally got the trade entered correctly. When she tried to place a counter trade (stop loss) the platform had returned to the previous state of not allowing an order on the USD/JPY. She tried multiple times, became frustrated and asked for my help. I tried the platform and observed that the USD/JPY cross was not one of the choices even though she was getting quotes, just as shown in the video.

We shut down the FXCM platform restarted it and after awhile the cross reappeared and the order was placed. She sent an email (as required) with all info and asked "How to overcome this obvious problem with the platform?" She never asked for a refund, she only wanted to know "how to fix the problem?"

Their reply was "You can't put stop loss orders in on this platform, you must transfer your account to the UK branch."

This reply was at best a waste of time, but more importantly was insulting to anyones intelligence as a stop loss can be placed it is simply a reversing order.

btw...she pulls maintenance on her computer daily for viruses, Trojans, greyware, malware, cleaning the registry, defraging the hard drive, etc; so we know the problem was not her computer and since mine is on the same network and had no difficulty during that time it was not the Internet connection
 
I have seen where the prices can be both a blessing and a curse from FXCM, sometimes traders gain a little sometimes they loose.

Difficult for me to see it as a blessing if the prices are not following the actual market.

If that's accurate (posted video), I found it ridiculous (their quoted prices).(n)

Can't understand why should anybody in their right mind use that company's services.:?:
 
Hi,

I have a spreadbetting platform with FXCM. Lately my losing trades have been getting stopped out with more pips then originally set. Today for example I was in a cable trade where I set a stop loss of 43 pips. The trade was a loser but I got stopped out at 55 pips loss instead of the 43 pips originally set.

Since this has been happening very frequently whereby FXCM stops me out by atleast 7 pips more then I had originally set on my EURUSD and GBPUSD trades I wonder if anyone else has been experiencing similar problems.

With the spread being around 3 pips for both pairs I would expect to be stopped out at no more then 2 pips extra of my original stoploss figure.

Losing over 7 pips more then what you originally set on a regular basis can be painful to one account.

Alps


Your is not the first I complaint I have read, there are many more on the internet ,just google and do your research.

Here is one I read on TSD

http://www.forex-tsd.com/metatrader-brokers/11405-fxcm-17.html#post290846
 
The trader was trading euro usd and cable, the most liquid currencies.Do you have liquidity problems on the majors?

If this continues , the internet will be full of hundreds of videos and threads like this about FXCM.



Is that a SB platform and a DMA platform? I see the differences in price but which platform is which? Was there a position running on the SB platform at the time?
 
Is that a SB platform and a DMA platform? I see the differences in price but which platform is which? Was there a position running on the SB platform at the time?


It is difficult to tell from video , if this is demo or real account.Demo and real feeds vary greatly.

http://en.wikipedia.org/wiki/Bucket_shop_(stock_market)

The transaction goes 'in the bucket' and is never executed. Without an actual underlying transaction, the customer is betting against the bucket shop operator, not participating in the market. Alternatively, the bucket shop operator "literally 'plays the bank,' as in a gambling house, against the customer."
 
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