APIs: Metatrader and brokers disliking them

[trendie]

I read somewhere that some brokers, particularly Metatrader, dislike APIs, for some reason.

My question is:
Why would a broker dislike any automated system to be run?
(dont they get paid commissions per trade?)

How does a broker know an automated system is running?
(apart from those stupid "trade-every-minute" robots that cant possibly be human-triggered)

I also know that "native" trading is when the code for trading is held at the brokers themselves, rather from my PC and sent to them.
Is this available to retail traders like myself?

Presumably they would need to know the code that triggers the API?

Can you run an API (at the brokers end) without declaring the source code?
(I think I probably know the answer to this anyway)


I am nearing the point of part-automating, and need to know any obvious pitfalls, etc.
thanks

 

[Jason Rogers]

I read somewhere that some brokers, particularly Metatrader, dislike APIs, for some reason.

My question is:
Why would a broker dislike any automated system to be run?
(dont they get paid commissions per trade?)

How does a broker know an automated system is running?
(apart from those stupid "trade-every-minute" robots that cant possibly be human-triggered)

I also know that "native" trading is when the code for trading is held at the brokers themselves, rather from my PC and sent to them.
Is this available to retail traders like myself?

Presumably they would need to know the code that triggers the API?

Can you run an API (at the brokers end) without declaring the source code?
(I think I probably know the answer to this anyway)


I am nearing the point of part-automating, and need to know any obvious pitfalls, etc.
thanks

A dealing desk broker may dislike an automated system if it uses a scalping strategy Scalpers present a problem to dealing desk brokers because exiting a trade within seconds of for just a few pips doesn't give their dealers enough time to properly hedge the trade.

Not all brokers dislike scalping strategies. An STP (straight through processing) or NDD (no dealing desk) broker hedges each order immediately and profits through a commission or the bid/ask spread, therefore scalping strategies are welcome.