Maximum stop loss slippage using DMA

kwickwool · Mar 20, 2009

Hi All,

I am wondering what the maximum slippage away from their stop order anyone has seen who is using DMA when there is sudden market movement as in the euro/dollar in the week.

In lamens terms, and to give an example as in what happened on wed with the euro/dollar when it shot up about 200, if i was in a SELL order at the time and had my stop order placed directly on the market using DMA at say 15 points above the price as it shot up instantaniously(well virtually) how far away from my stop would the order have been filled?

What is the maximum difference between the stop order and filled order that anyone has observed whilst using DMA on oil, forex etc? Just want to get a feel for it? For instance when the fed initially rejected the bailout package did anyone using DMA get really stung on the dow?? >50 points slippage anyone?

I am very interested in this as i am starting to trade well but would like to really know what my exposure could be in a worse case senario, difficult to give exact answers here ladies and gents but i am sure that there are a few experienced traders out there that could add something here?

warm regards,

Christian

foredog · Mar 20, 2009

Please don't be offended at this...to use an English phrase

"How long is a piece of string?"

If the market moves like that you may well bet stung 50pts but it's a Black swan, how likely were you to be short then? And the next time the market moves like that? You'd be really unlucky to be on the end of that 3 times in a row!

If you're not risking a big % on each trade then over time this would be absorbed by your profits.

kwickwool · Mar 20, 2009

Thanks for the reply foredog, dont get me wrong i do realise that this is an impossible answer to give, i just wanted to get a feel of what other traders have been exposed to in their time trading and if there are any horror stories out there........not asking anyone to guess what the potential loss could be just what their experiences have been.

Yes totally agree if u r trading small percentages and have your risk correctly calculated its not a major issue statistically just want to gather info on this

Paul71 · Mar 20, 2009

kwickwool said:
Yes totally agree if u r trading small percentages and have your risk correctly calculated its not a major issue statistically just want to gather info on this

Risking small amounts and hitting the big run? Is that supposed to be proficient? Well, in my book, if a trader is proficient enough to 'see' the big run, what is the point of tight stops, risking small amounts, keeping it tight, etc etc?

As for your original question, i've never encountered any problems personally in terms of slippage on stops.

Paul.

kwickwool · Mar 20, 2009

Not sure if i am being dull here or not explaining myself, i am not talkng bout trading small amounts try to hit the big one, im talking about risk management which is probably one of the more important rules for spread betters. I am talking about just a normal scal on the market and say suddenly a plane flies into the sky scrapper, things you cannot take into account, has anyone ever say had a stop loss close on a DMA account with >50 point slippage???

Paul71 · Mar 20, 2009

kwickwool said:
Not sure if i am being dull here or not explaining myself, i am not talkng bout trading small amounts try to hit the big one, im talking about risk management which is probably one of the more important rules for spread betters. I am talking about just a normal scal on the market and say suddenly a plane flies into the sky scrapper, things you cannot take into account, has anyone ever say had a stop loss close on a DMA account with >50 point slippage???

Risk management? What about profit management? Is profit management not as important as risk management?

kwickwool · Mar 21, 2009

lol.......Paul m8, they are basically the same thing arnt they?, u say tomato i say tomato type thing?
Being profitable is about keeping your risk to a level that you can stay in profit with all the potential horrors that come into play?
ps yes spotting the big ones does make tight stops totally irrelevant in the risk/reward ratio and is indeed poor risk/profit management.

Paul71 · Mar 21, 2009

kwickwool said:
Not sure if i am being dull here or not explaining myself. I am talking about just a normal scal on the market and say suddenly a plane flies into the sky scrapper.

You tw*t! Sorry, totally misunderstood you at first. I actually have in place a, 'plane flying into a skyscraper stop', on all my trades.

kwickwool · Mar 21, 2009

ffs, r u pissed or just had a bad day trading?.....its a simple question to ask DMA traders, it sounds like u are a legend at trading and dont even bother with stops and you have got it all worked out and live on your own island somewhere.

Lots of traders who use stops as an important part of their trading RISK management dont expect to put in a stop and find out it stop 100 pips away from the stop, which can happen i believe so i wanted to find out how often.........

As a legend member Paul you are either totally minted or if not then you just aint that good, its simple, when the bailout in the states was initially rejected how much did the market fall, fecking loads and if at the time you were in a BUY contract on the dow did the stop take some slippage and how much?

ps anyone who hedged on the rejection i will personally bow down to a total genius....

Paul71 · Mar 21, 2009

kwickwool said:
ffs, r u pissed or just had a bad day trading?.....its a simple question to ask DMA traders, it sounds like u are a legend at trading and dont even bother with stops and you have got it all worked out and live on your own island somewhere.
As a legend member Paul you are either totally minted or if not then you just aint that good, its simple.

It's a good point. What the feck am i doing on here talking to someone about stops and the relevence of planes flying into skyscrapers? You started it, i'll end it.....goodnight and godbless.

kwickwool · Mar 21, 2009

yea goodnight fella

Maximum stop loss slippage using DMA

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