ECN Speed and Reliability

[Sanity]

Hi all,

Am working on a system at the moment that will trade one MT4 platform off against another by comparing each other's prices. For this system to work, all trades would have to be accepted by the brokers with no slippage (buying from one, selling to another). Do ECN providers put every trade through, or is it only like 80-90%? Do some get rejected or slipped? I've only ever traded with Market Makers before so am new to the ECN stuff.

Also, how will things like commissions affect this type of strategy? If I'm only making 0.1 - 2.0 points a time will commission even get charged, is there like a flat fee or is it percentage based for these type of brokers?

Does anyone else have experience of doing this? Any success, problems?

San.

 

[RobCripfx]

Hi all,

Am working on a system at the moment that will trade one MT4 platform off against another by comparing each other's prices. For this system to work, all trades would have to be accepted by the brokers with no slippage (buying from one, selling to another). Do ECN providers put every trade through, or is it only like 80-90%? Do some get rejected or slipped? I've only ever traded with Market Makers before so am new to the ECN stuff.

Also, how will things like commissions affect this type of strategy? If I'm only making 0.1 - 2.0 points a time will commission even get charged, is there like a flat fee or is it percentage based for these type of brokers?

Does anyone else have experience of doing this? Any success, problems?

San.

if you trade real forex markets, you will always get slippage. the best is to do all you can to avoid this slippage. there are many brokers with very good high tech structure that gives lower latency trading and better execution for clients

But if you think you will never get slippage you are very wrong

 

[forexjudge]

if you trade real forex markets, you will always get slippage. the best is to do all you can to avoid this slippage. there are many brokers with very good high tech structure that gives lower latency trading and better execution for clients

But if you think you will never get slippage you are very wrong

I think a platform with faster execution is immune to slippage.

 

[daytrader221]

In the real market there will always be slippage, its inherent with ECN trading - especially during volatile market times like the news. If a broker never passes slippage then it is unlikely you have direct market access and is also unlikely that you are trading with an ECN. You will never get a requote with an ECN, they should all go through so if there is high volatility and some order latency (there always will be) then there has to be some slippage, which could be in your favour or against you. Most ECN brokers with raw spreads charge a fee per round lot traded so if there are commission fees you should be able to work it out as a percentage according to the amount of lots traded.

This is my experience of trading with an excellent ECN/STP broker. I received some positive and negative slippage before but the order execution is guaranteed and happens instantly.

 

[icmarketsfx]

Very true.

 

[gle101]

Yes latency is a big issue at times, resulting in unnecessary slippage. Most of the service providers for MT4 have in my experience rather slow execution time, this compare to for example the cTrader ECN platform which is much faster.

 

[MPepe68]

MT4 is big cause of latency, you need very good vps close to trade server

 

[Magos]

Latency arbitrage

Hi all,

Am working on a system at the moment that will trade one MT4 platform off against another by comparing each other's prices. For this system to work, all trades would have to be accepted by the brokers with no slippage (buying from one, selling to another). Do ECN providers put every trade through, or is it only like 80-90%? Do some get rejected or slipped? I've only ever traded with Market Makers before so am new to the ECN stuff.

Also, how will things like commissions affect this type of strategy? If I'm only making 0.1 - 2.0 points a time will commission even get charged, is there like a flat fee or is it percentage based for these type of brokers?

Does anyone else have experience of doing this? Any success, problems?

San.

That sounds like latency arbitrage, be careful with the following:
1. Transaction costs (spreads, commissions and rollovers).
2. You will have slippage unless you have instant execution (re-quotes).
3. Rejection of orders; some of your trades will not be filled (legged out).
4. Execution speed; you will not be filled at the same speed with al trades (latent execution depending on dealing desk policy).

Do not forget your not an institutional trader having a PB; therefore you will need to open and close trades with the same broker - therefore Point 1 is very very important (costs).

Yes - I have experience in this.

 

[redtag12]

In the real market there will always be slippage, its inherent with ECN trading - especially during volatile market times like the news. If a broker never passes slippage then it is unlikely you have direct market access and is also unlikely that you are trading with an ECN. You will never get a requote with an ECN, they should all go through so if there is high volatility and some order latency (there always will be) then there has to be some slippage, which could be in your favour or against you. Most ECN brokers with raw spreads charge a fee per round lot traded so if there are commission fees you should be able to work it out as a percentage according to the amount of lots traded.

This is my experience of trading with an excellent ECN/STP broker. I received some positive and negative slippage before but the order execution is guaranteed and happens instantly.

Hi,you seem to have a grasp of the ecn brokers so i have a question for you.Its not a trick question i really do not know the ans to this one.I thought i did.Here goes If an STP broker keeps trades and passes them to his liquidity providers would this be classed as passing the order to the Interbank Market.Im just wondering how also he can keep trades if he has no DD,all a bit confusing.
Regards Mike...

 

[billyjean]

Hi,you seem to have a grasp of the ecn brokers so i have a question for you.Its not a trick question i really do not know the ans to this one.I thought i did.Here goes If an STP broker keeps trades and passes them to his liquidity providers would this be classed as passing the order to the Interbank Market.Im just wondering how also he can keep trades if he has no DD,all a bit confusing.
Regards Mike...

perhaps you can write abit here
https://www.100forexbrokers.com/stp-ecn-brokers
scroll down abit for article : Forex brokers: ECN vs STP vs NDD vs DD
perhaps this could answer your question. how the fx market order works.
well. the wiser always said when in doubt dont trade

 

[NigelPower]

Sounds a bit like arbitrage, I don't think you'll be able to use your system without issues.

 

[hatemypips]

Sounds a bit like arbitrage, I don't think you'll be able to use your system without issues.

use two different broker trading platform, and aim for minor error price reading, unless thats what I read while checking with google. .
but it seem that's more other arbitrage method, actually first to comes out while search through the net, triangle arbitrage comes first, more like correlation between 3 related pair.
wouldnt able to use without issue ? means there's a chance to use this then, if we can disrupt any issues, by any chance had you ever try this method before ?

 

[billyjean]

use two different broker trading platform, and aim for minor error price reading, unless thats what I read while checking with google. .
but it seem that's more other arbitrage method, actually first to comes out while search through the net, triangle arbitrage comes first, more like correlation between 3 related pair.
wouldnt able to use without issue ? means there's a chance to use this then, if we can disrupt any issues, by any chance had you ever try this method before ?

for educational purpose, it still can be done with demo account, automatic trading. this type of trading style demand quick react, fast execution, none of manual traders would able to catch. but the idea are comes from real manual trader with high fast imagination of spotting market price flaw, as arbitrage born from it .
I've done this before got an EA more like slave and master (think of PC desktop HDD), but not good result yet, use ECN demo type with tickmill as master and iron as slave account. I though it would going well since, their spread are at signifcant different, it's may happen because often lagging while execute entry at slave account.