FXCM Discussion

This is a discussion on FXCM Discussion within the Forex Brokers forums, part of the Commercial category; Originally Posted by TraderNumber7 Good Evening Jason! You keep referring readers to the United Kingdom. FXCM is not based in ...

Reply
 
LinkBack Thread Tools Search this Thread
Old Mar 11, 2010, 9:08pm   #9
 
Jason Rogers's Avatar
Joined Jun 2009
Re: FXCM Discussion

Jason Rogers started this thread
Quote:
Originally Posted by TraderNumber7 View Post
Good Evening Jason!

You keep referring readers to the United Kingdom. FXCM is not based in the United Kingdom. FXCM is based in the United States and subject to CFTC rules and regulations.

Try this website: http://www.fxcm.com. Go look at the marketing copy and read it carefully. "No Dealing Desk Means No Dealer Intervention." No Entry Order Restrictions." "No Conflict of Interest Between You and FXCM - We Want Profitable Traders!" Then read the tiny print Daggers and Bullet Points at the bottom of the site.
Hi TN7,

I'm surprised at how little you know about FXCM despite your claims otherwise.

FXCM has multiple locations throughout the world. If your account is open through our US entity (www.fxcm.com) then you are subject to CFTC rules and regulations.

FXCM has an entity in the United Kingdom, FXCM UK www.fxcm.co.uk, which is regulated by the Financial Services authority, firm registration number 217689. You can find a complete list of our locations and registrations on FXCM UK's website http://www.fxcm.co.uk/international-offices.jsp. It seems like you have a lot to review. Maybe we should start at getting the small stuff correct before discussing the bigger items.
Jason Rogers is offline Broker   Reply With Quote
Old Mar 12, 2010, 9:17am   #10
 
>Apocalypto<'s Avatar
Joined Nov 2009
Re: FXCM Discussion

Quote:
Originally Posted by Jason Rogers View Post
Hi TN7,

Your information here is incorrect. The banks providing liquidity to FXCM take mini lots of 10k in addition to 100k standard lots. Your statement may have been correct in the early 2000’s when you traded with FXCM, but this is no longer true. Technology progresses.

I’m happy to announce that we are also preparing to offer No Dealing Desk execution for our micro clients as well. When we first launched FXCM Micro, we planned to offer No Dealing Desk execution. However, the banks would not stream prices in micro lots. This was simply unheard of in the foreign exchange industry. Our FXCM Micro traders have since placed over 30 million trades totaling 200 billion in notional volume, and the banks have changed their minds. Where there’s a will, there’s a way, and the banks have realized the opportunity in taking even these trades. As one of the largest forex brokers, the amount of volume we bring to the table allows us to negotiate this type of service to pass along to our traders.



Do you think the best bid and offer price magically sorts itself out on its own and then displays this information on the platform? Of course not, the pricing engine looks at the 10 bid and ask prices being quoted, and then the best bid/ask price is streamed onto the platform.

Quick example. Let’s suppose there are 2 banks (to keep things simple) each providing liquidity in GBP/USD.

Bank A is quoting 1.5043 bid and 1.5045 ask
Bank B is quoting 1.5042 bid and 1.5044 ask

So the best bid/offer engine sees two prices being quoted on each side (bid and ask). It then identifies the best price out of the selection which is 1.50430 bid from Bank A and 1.50440 from Bank B. The spread is 1 pip. At this point, a fixed pip mark-up is added to the bid/ask and streamed onto the platform. Assuming there is a 1 pip mark-up on GBP/USD, the final pricing you see on the platform would be 1.5042/1.5045 for a 3 pip spread on GBP/USD. FXCM is compensated for it’s services through a mark-up on the spread as explained on the website and what you pointed out. This is the fee paid for using FXCM’s services.

On the FX Trading Station II, this entire process in the pricing engine occurrs with 10 separate banks providing liquidity. I’ll go into further detail about the off-setting process of No Dealing Desk execution further below.



I’ll give a detailed example of how NDD execution works on the backend.

Suppose you want to buy GBP/USD and the current market price you see on the platform is 1.5045 and assume that the mark-up on the buy price is 1 pip. Therefore bank A is offering to sell GBP/USD at the price 1.5044 and FXCM is charging and additional pip so you see the price 1.5045 on the platform.

When you press the buy button, the order is sent to FXCM, and FXCM routes the order to Bank A to execute a trade at the price 1.5044. If liquidity is still available at that price the trade is executed. Confirmation is sent back to the platform and you see an open long (buy) position at the price 1.5045. The bank has a short position at the price 1.5044 and FXCM has made a pip on the trade.

If your trade can’t be executed with Bank A at the price you clicked on, then one of two things can happen: slippage or trade rejection (depending on the type of order submitted). Let’s assume this is an At Best market order which will be filled at the best price available. If Bank A sends back a message that the order can’t be filled at the price 1.5044, then the order will be executed at the next best available price. Bank B is offering to sell to you at the price 1.5045. The order is sent to Bank B and executed at the price 1.5045. You have a long position at 1.5046 (due to the 1 pip mark-up), Bank B has a short position at the price 1.5045, and FXCM made 1 pip on the trade.

Regardless of the amount you make or lose on the trade, FXCM is left with 1 pip. Your profit or loss is not FXCM’s loss or gain since we are not acting as a market maker on No Dealing Desk execution. Neither is slippage an additional gain for FXCM since the same pip amount is paid.



If checking the website, one would discover there is no separation between mini and standard accounts. This is why I didn’t mention standard vs. Mini accounts. Since the banks will accept both mini and stanard lots on No Dealing Desk execution, there’s no need to separate the two accounts types. You can trade either lot size and combinations of the two from the same account. I imagine the same will occurr with micro lots once NDD goes into effect.



It says no entry order restrictions because you can place it within 1 pip of the forex market. Here’s the exact quote from the FXCM UK website “Place Entry Orders and Stops/Limits within 1 pip of the forex market. Any order whether it be market order or entry order has a restriction of 50 million notional per trade. Why is this the case? There is not unlimited liquidity at each price. If you place an order for 50 million, chances are you will be slipped. Just take a look at the depth of market on the Active Trader platform, and it will give you an idea. Banks are managing their risk as well by charging a higher price for trading as they take on the risk of a larger trading size. Most profesional traders will instead scale into their positions even if it’s 10 million at a time so as not to show their entire “hand” on what they are doing to the market.

Restrictions on stops, limits, and pending entry orders often occur with market makers or dealing desk brokers. This occurs because bank spreads are variable, while dealing desk market makers are normally fixed. Therefore, if a bank provides a 5 pip spread and the dealing desk broker is guaranteeing a 2 pip spread, the dealing desk broker will lose 3 pips on each trade. To mitigate this risk, restrictions on orders may be imposed. If the dealing desk broker chooses a restriction of 5 pips then they have mitigated their risk to 7 pips (5 pip restriction + 2 pip spread). Unless bank spreads widen past 7 pips, the dealing desk broker is protected. During news events and volatile markets, bank spreads can easily widen beyond this amount, which is why dealing desk brokers may heighten restrictions when the market is likely to move.



I completely respect your opinion. Our decisions on the expo location are made on accessibility for our traders.

-Jason


PS. This response is a reply to this post http://www.trade2win.com/boards/fore...ml#post1069828
god your replies are just rubbish..... you just dribble crap over and over again.

TraderNumber7 good going champ great posts agree with you 100% FXCM is NOTHING MORE THEN MARKETING SPIN.............
>Apocalypto< is offline   Reply With Quote
Old Mar 12, 2010, 3:19pm   #11
 
Jason Rogers's Avatar
Joined Jun 2009
Re: FXCM Discussion

Jason Rogers started this thread
Quote:
Originally Posted by >Apocalypto< View Post
god your replies are just rubbish..... you just dribble crap over and over again.

TraderNumber7 good going champ great posts agree with you 100% FXCM is NOTHING MORE THEN MARKETING SPIN.............
Hi Apocalypto,

I would be happy to discuss anything with you have anything meaningful to add to the conversation. If you agree with TN7 100%, I'm guessing this also applies to his claim of FXCM UK being non-existent and marketing spin? or that FXCM has fixed forex spreads as claimed by TN7?
Jason Rogers is offline Broker   Reply With Quote
Old Mar 12, 2010, 3:39pm   #12
 
>Apocalypto<'s Avatar
Joined Nov 2009
Re: FXCM Discussion

Quote:
Originally Posted by Jason Rogers View Post
Hi Apocalypto,

I would be happy to discuss anything with you have anything meaningful to add to the conversation.
Quote:
If you agree with TN7 100%, I'm guessing this also applies to his claim of FXCM UK being non-existent and marketing spin? or that FXCM has fixed forex spreads as claimed by TN7?
very average attempt to dumb down / belittle her argument.

you do fix the spreads, and she never said FXCM UK did not exist re-read the post.... we both agree your ND STP is utter bull****.

That's my Opinion and like her I feel all new traders should understand this. once you trade with a real broker like Interactive brokers you quickly see through the crap pitched by companies like the fine one you work for and the what they serve up to you is actually very far off what i like to think a ECN ND is. don't preach Active trader it's nothing to what IB gives me.... your coms are way to high and the spreads don't compare.

I have no issue with what you do, I just want you to call it how it is. you do make a market on CFD's in AUST and you manipulate spreads. Yes you do, you mark them up to the client... that's manipulating them.

no hard feelings just drop the bull****... it's not that hard JR

cheers have a nice weekend
>Apocalypto< is offline   Reply With Quote
Old Mar 12, 2010, 3:59pm   #13
 
Jason Rogers's Avatar
Joined Jun 2009
Re: FXCM Discussion

Jason Rogers started this thread
Quote:
Originally Posted by >Apocalypto< View Post
very average attempt to dumb down / belittle her argument.

you do fix the spreads, and she never said FXCM UK did not exist re-read the post.... we both agree your ND STP is utter bull****.

That's my Opinion and like her I feel all new traders should understand this. once you trade with a real broker like Interactive brokers you quickly see through the crap pitched by companies like the fine one you work for and the what they serve up to you is actually very far off what i like to think a ECN ND is. don't preach Active trader it's nothing to what IB gives me.... your coms are way to high and the spreads don't compare.

I have no issue with what you do, I just want you to call it how it is. you do make a market on CFD's in AUST and you manipulate spreads. Yes you do, you mark them up to the client... that's manipulating them.

no hard feelings just drop the bull****... it's not that hard JR

cheers have a nice weekend
I understand everyone's entitled to their opinion, but opinions aren't fact. And it doesn't address the inaccuracies.
Jason Rogers is offline Broker   Reply With Quote
Old Mar 12, 2010, 4:41pm   #14
 
>Apocalypto<'s Avatar
Joined Nov 2009
Re: FXCM Discussion

Quote:
Originally Posted by Jason Rogers View Post
I understand everyone's entitled to their opinion, but opinions aren't fact. And it doesn't address the inaccuracies.
trader 7 made some excellent points based on inside knowledge of the interbank, really only a IB trader would know.

some of the reply's made to her lacked anything, basically mindless repetitive dribble reworded, that is very frustrating. hence more emotion was expressed at the fact you would not admit to much of what she wrote to be correct.

and what makes you being here pointless is you can't. you will never say a bad word as you are paid by FXCM so how can you be objective. I think your role on this forum should be much smaller or you simply ignore comments made by member's like us.

it's one for the mods.... I have my opinion on your product based on experiences I have formed with trading with many companies and extensively looking at your and measuring it to others.

My opinion will not change and I will not stop posting my thoughts on it.

cheers
>Apocalypto< is offline   Reply With Quote
Old Mar 14, 2010, 10:01pm   #15
Joined May 2008
Re: FXCM Discussion

what kindof volume can you put in during normal market hours (london open) using the fxcm raw feed? 50m?
roger123doger is offline   Reply With Quote
Old Mar 15, 2010, 9:11pm   #16
 
Jason Rogers's Avatar
Joined Jun 2009
Re: FXCM Discussion

Jason Rogers started this thread
Quote:
Originally Posted by roger123doger View Post
what kindof volume can you put in during normal market hours (london open) using the fxcm raw feed? 50m?
Hi Roger,

It will vary throughout the day. I would recommend opening a demo on the Active Trader platform and it will show the liquidity being made available. The active trader platform is found here http://www.fxcm.co.uk/active-trader.jsp

-Jason
Jason Rogers is offline Broker   Reply With Quote
Reply

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Similar Threads
Thread Thread Starter Forum Replies Last Post
FXCM Announces the Winner of FXCM Automated Trading Challenge jsales Forex Brokers 0 Dec 13, 2010 6:39pm
FXCM Launches FXCM Labs for Beta Testers jsales Brokerages 0 Aug 4, 2010 2:37pm
Notice to FXCM LLC (FXCM U.S.) Traders: How to use Stops and Limits after July 31 jsales Forex Brokers 2 Jul 7, 2009 3:52pm
TA v FA Discussion FTSE Beater Technical Analysis 12 Sep 25, 2003 11:27pm

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)