Best Thread FXCM Discussion

It would be interesting to hear from some actual users of FXCM's service, particularly their "active trader" service. If there are any here please post your experience.

As people were mentioning IB I posted some comparisons below, FXCM on the left, IB on the right, one for last night, one for today. Apart from the modest size on the inside price for FXCM they compare quite well. These are just a static snapshot, To get a real feel you have to see it on your own screen. The FXCM side sometimes goes down to 0.2 wide and sometimes up to 0.8 while IB stays 0.5 most of the time and goes up 1.0 wide briefly at other times.

Other pairs have a similar comparison.

These are only demo accounts so I can't comment on fill speed or quality. The commission structure is also very different. I know FXCM has had a questionable reputation in the past but this does seem to indicate they are worth a look.

So, are there any real users of their service here ?


 
FXCM's execution acted almost exclusively as a market maker up until 2006. However, your knowledge of FXCM's execution on NDD introduced to accounts in 2006 is incorrect.

You keep attempting to build a mountain out of a mole hill here, Jason. Why? Why do it in full plain view, when I've already exposed the true nature of FXCM in this thread already. It makes no sense to continue fighting for what does not exist. Why do you continue to do it?


Our NDD system doesn’t have a Dealing Desk that trades against you, plain and simple. Even on Micro, which is not currently NDD, we offer trading without re-quotes and intervention. And that will be NDD soon as well. This is what we offer to traders.

Red Herring, Jason. Nothing more and nothing less. Go re-read what I've put up in this thread on Interbank market size and scope - THEN - come back here and talk to me about NDD, STP and wide liquidity. It is all a smoke screen at FXCM, Jason. You know it and I most certainly know it.


As stated before, we don’t state that we offer interbank access.

Thank you for telling us what we already knew. Do you mind also telling us what the difference between Forex Access and Interbank Access actually looks like? Define: Forex -vs- Interbank.

I'm not looking for a White Paper on back-end or back-office solutions about physical "trade execution." I want a straight-up answer from FXCM on how it defines what it is selling to the Newbie Trader. Are you selling FXCM as a Forex Intermediary - or - as an Interbank Intermediary, or does FXCM even bother to make any distinction at all.

I have clearly articulated my position on this question already inside this thread, so there is no mistaking my view on the subject, White Paper aside.


Take a look at www.fxcm.com, www.fxcm.co.uk, or any other of our marketing websites. A Google search of www.fxcm.com or www.fxcm.co.uk for the term “interbank” comes up with only 3 to 5 entries, and none of these references any claim that NDD offers “Interbank” pricing, liquidity, or execution in any way.

Oh, I see. Ok, so.....well.....if FXCM does not offer "Interbank Access," then what precisely does FXCM offer the Newbie Trader?


What we claim is that FXCM’s No Dealing Desk Execution offers traders a trading system where “10 banks compete to provide tight spreads”.

Oh, I see!

You now drop the entire word "FOREX" from the discussion here and replace that word with a phrase "TRADING SYSTEM." How convenient is that. So, absolute NO Forex Access and absolute NO Interbank Access. Yet, in a previous post of yours right here inside this thread, you claimed that there was something flawed about my definition of what "Interbank" truly meant. Remember that statement you made, Jason?

You generally suggested that my definition of "Interbank" was over-broad and you then implied that the FXCM "10 Bank" offering, was also or likewise, Interbank too. You never implied that it was a "TRADING SYSTEM." You never did that until I pulled it out of you here in this thread.


It’s pretty simple, either your broker has a bunch of dealers trading against you – possibly hunting stops, rejecting trades, and or requoting - or they don’t. If you trade on NDD, your broker won’t be trading against you. Trade with a Dealing Desk, and they might be.

Shifting to the side of the supposition where you know you don't reside and then merely re-quoting the "truth" as though you were actually a part of it, does not change or alter the true Bucket Shop Basket Weaving nature of FXCM. No amount of pontification about the truth, absent actual adherence to the truth will either alter the truth, or place you on the side of truth, if that is not where you already reside.


That’s a good point. I’ll have that page changed.

If I actually needed the job, maybe, FXCM would hire me. :D


However, I'll point out that this reference is buried in the middle of an enormous block of text on a page that, in the past 12 months, has gotten between 5 and 38 page views per week.

Well, that's the point here, Jason! Newbies, are not likely to dig into this kind of stuff - but you won't pass it off on a seasoned vet. BTW - who put that "enormous block of text" on that web page anyway? Did the FXCM competitors put it there, just to confuse the Newbie Trader? Inquiring minds want to know.


It’s true, FXCM’s NDD system is not Autobahn or BARX or HSBCnet. We never claimed it was.

But, that assumes and implies that someone else did claim that you were and that never happened either. These were not even comparisons. These were mere facts that I wanted every Newbie to fully understand when they go to a Bucket Shop like FXCM and actually think that they are trading the real Interbank market in all of its depth and breadth - that's all I am doing here.

It is called: Truth In Advertising. Remember?

Just because you don't state a thing, does not mean that you fail to imply that same thing.


With FXCM, you can be trading with amounts in the thousands, not the millions, and most anyone can sign up within a couple business day. And by trading on NDD execution, even in lot sizes as small as 10k, the conflict of interest between trader and broker is eliminated.

And, all the while, never ONCE be trading the actual Forex or Interbank Market in all of its richness, as implied by most FX Brokers - either directly or indirectly (see last statement above). This is the dirty little secret behind what you guys are doing, Jason. I'm just putting a spotlight on it inside this thread, that's all.


Do Dealing Desk brokers have ticket volume limits because they’re taking the other side and can’t handle anything too big? Yes.

Thank you, finally.


Is that the only reason to have ticket volume limits? No.

Oh, do explain.


That’s a leap of logic that doesn’t hold up.

Prove it. Or, better yet, proof it.


We have ticket volume limits for a variety of reasons that enhance our product, not because we’re trading against you.

Let's see one of them, please.


Convoys move at the speed of its slowest ship, so our blanket $50M per ticket limit applies to EUR/USD at London Open (which typically has massive liquidity) just as equally as it applies to GBP/NZD at Friday US Close (where it’s a surprise if anyone’s still even trading).

LOL! You can't be serious, Jason.

Is this proof or proper justification for why FXCM behaves just like any other Bucket Shop? The ole "Convoy" excuse might work on somebody less adept at this topic, Jason - but you are going to have to try a little bit harder, when attempting to pull the wool over my eyes.

Why? Have you looked at the executable pairs on the FXCM platform lately? Yeah, that's right, it is loaded with pairs with far less liquidity than merely the relative lacking liquidity of NZD linked pairs, Jason. So, if you are going to use the "slowest moving of the convoy" logic here, then that would also have to extend all the way down the food chain to pairs with far less liquidity then NZD alone. This blows your "slowest moving member" theory out of the water - entirely.

Why? Because, in order to apply that logic across the board of what the FXCM platform offers in terms of traded pairs, the max notional value per click would be far less than $50MM.

Not a very impressive argument, Jason. Now, reload and try again. Only this time, select a better logical premise and check the back-door logic before you make your declaration. :cool: (did you attend any debate classes in college?)


The EUR/USD is not the reason for the limit, the GBP/NZD is.

That's incorrect.

Why? Because, in order for that to be true, you would have to hold all other currencies with far less liquidity than NZD, which are also executable on your platform, to the same logical standard, which would by definition reduce the single click notional value well below $50MM as a simply mathematical fact.

Logically, you can't have it both ways, Jason. This is a failed theory. Try again and check your premise, first. (you should have attended those debate classes!) :D


We could talk about the average ticket size of retail traders; We could mention how you can call in for a bigger order; We could even get into conversations bank “industrial” feeds (which have a lot more liquidity, but speculators get quickly banned from) are like comparing apples to oranges, or talk about the volume levels that people typically still use phones to execute. We could talk about how this is the maximum amount available per click, and that you can click through several $50M trades very rapidly if you choose. If you want to put through trades of this size, it's best for you to view the market depth, whether EUR/USD or GBP/NZD, and the Active Trader platform is more suitable.

And, after we were done talking about all of that "work-around" nonsense, we STILL would NOT be talking about trading the real Interbank market with anywhere near its true depth and breadth of liquidity - and - that is the point to this exercise.

Furthermore, if this logic were to hold up (and it clearly does not), then such limitations would or should ONLY apply to those pairs linked to currencies with less than adequate liquidity, as defined by FXCM in its syllogistic reasoning for why the $50MM notional limit exists in the first place.

Bingo - just like that, I've proven the logic to be flawed from two different vantage points:

1) The lack of liquidity in executable pairs on the FXCM platform that extends well below NZD.

and...

2) The inverse of the logic that sets the syllogism for restricting the notional value down to $50MM in the first place.

Here's a hint, Jason:

Before you make an argument about anything (anything in life at all) - always (first) check the INVERSE of the premise for the argument to see if you might have left a back-door open, wide enough for your opponent to drive a Mack Truck through it.

Never leave the Inverse of your argument uncovered/exposed. Debate 101. You've done this now, five (5) times since you opened this thread and I engaged you. Exactly how many more times will you make this error in judgment, before you realize what it is costing you with every keystroke?

Tactically flawed debate. Easily defeated. You are not making FXCM look good, here. :D


Again, from our website “When a customer clicks on a price, they are actually clicking on a price from the bank that currently has the best bid or offer, plus our markup.” We run standard markups, usually a pip for most pairs. If you want to call that “manipulating the price”, then we’re just playing semantics. The key here is that the markups are consistent.

Oh, come on, please! Sell it to a Total Neophyte, but pleeeeeeze don't attempt to sell this stuff to me, Jason! You are insulting my intelligence at this point in our conversation here and I was really starting to like you! Seriously, I do like your demeanor.

I told you that one day, you can come work for me and I meant it. :idea:

The point to this exercise is to inform the Newbie that when they sign-up with FXCM and click on "that price," that they are not clicking on a price provided to them through their Intermediary from the full depth and breadth that the true Interbank market provides - AND - furthermore, that when they see such pricing on the FXCM trading platform, they are to be fully aware that the un-real Interbank pricing they see, has also been altered to include a gift wrapped guaranteed profit for the Bucket Shop that holds their Retail Account.

So, not only are the "prices" bogus, relative to true Interbank rates, but they are also manipulated by FXCM as well, by logical definition. Undeniably, true.

That is NOT merely a semantically driven delusion of mine. Nor, is it a distinction without a difference. In other words, the two concepts are not fungible, Jason. There are very tangible distinctions between what FXCM does and what a true Interbank or Forex Intermediary offering genuine straight through processing (STP) through a real ECN Hub Architecture does for its customers and for its liquidity providers.


I’m sorry if you don’t buy it, but it’s true.

I've proven it to be un-true.


Many people didn’t believe that earth revolved around the sun, but that didn’t mean that Galileo was making things up.

Galileo, did not discover this fact. A full three hundred years before the birth of Jesus Christ, the Greeks had already laid the framework for heliocentricism, but it was not until Copernicus arrived with his mathematical model in his 16th century European environment, did the world begin to realize that just maybe, the world was not at the center of the Universe. I'm very well read on Einstein and Newton. I realize that Einstein gives Galileo credit for being the "father" of modern day model based astronomy and even modern science as we know it. However, nothing and no one can take away the mathematical conclusions that Copernicus made before Galileo. And, I'm certainly not going to be the one to disrespect the work of Copernicus, here.

Having said that, FXCM seems to think the 'world' is neither flat and nor round, but stupid.


The markup stays fixed throughout the trading day, every trading day. It’s consistent. We can change it if we want to, of course.

Which by definition means that FXCM is Bucket Shop, pure and simple.

How can the Intermediary alter that which is supposed to come from a free market place without manipulating the same in the process? Answer - you can't. You must be a price manipulating Bucket Shop to even consider such topics to be within the realm of natural protocol. Markup by definition means Price manipulation because you do not charge a flat street rate commission. FXCM would have more credibility if it had left the actual pricing alone and charged a straight-up commission that everybody can live with. Interfering with "in-bound market pricing" is "manipulation" by any definition. It matters not how one wishes to dance around the subject. Interception and Interference, is exactly the same thing, here.

FXCM's price feed should merely reflect what is actually taking place in the real Interbank market with a much wider array of depth and breadth; then charge a reasonable commission on the side, for all account types - period. No questions asked. That is the proper way to approach this business as an Intermediary, but this is not how the FXCM business model is established.


Our liquidity providers (i.e. “the banks”) give us prices, we take the best Bid and Ask, add the consistent markup, and spit it out as our platform’s price. Simple as that.

Translation: Hybrid Bucket Shop.

Not to mention a straight-up admission that the entire STP claim is bogus, entirely! STP, is supposed to be against real prices. If you tamper with the "real price," then you can no longer offer STP, by definition, in my opinion. This is Pip Skimming, no less and you control the actual market prices being displayed on the trading platform - so, by definition, the prices cannot be true Interbank anymore after FXCM has altered them BEFORE they are displayed to the Trader.

This is not rocket science. I know rocket science when I see it and this is not it.


Call it a “mid-sized regional hub city”.

Ok, I'll grant that label.

But, it is still NOT true Interbank with its real depth and breadth of liquidity - not even close and my numbers (math) proves that fact beyond any shadow of any doubt, whatsoever. So, stop selling, by way of implication, that Newbies trading with FXCM will at the same time, somehow also be trading direct to the broad/deep end of the Interbank or the Forex pool. They are not - pure and simple. Therefore, no one at FXCM can make the claim that "Best Bid/Offer" from either Interbank or the Forex, is being delivered to the customer via the FXCM trading platform.


So who are these “banks” that are on our system? I can’t disclose them because of NDA’s. I wish I could, but I simply can’t.

Some of your Competition has no problem whatsoever in disclosing who provides the liquidity under their trading platform, so why would FXCM enter into such an agreement with the very sources providing liquidity to those who use the FXCM platform? It makes no sense, whatsoever - especially, if they are "household names" in the Global Banking Industry.

What is FXCM hiding? Why only 10 Banks?

Your Competitors that use FXall shows off their liquidity proudly for the entire world to see:

FXAll

Your Competitor Divisa Capital FX shows off their relationships proudly for the entire world to see:

DCFX

Your Competitor LCG shows off their relationships proudly for the entire world to see:

LGC FX

Et, al.


That’s just not true. Page 9 of the BIS Trienniel survey http://www.bis.org/publ/rpfxf07t.pdf?noframes=1 (table B.4) points out that only 12 banks in 2007 held 75% of UK FX volume (estimated to be 34% of the global total), and 10 banks held 75% of US total volume. You and I both know a lot of the same banks appear in both those lists. A lot of them are also providing us with liquidity.

What's not true? Precisely define what was stated that was not true, please. I'm very familiar with BIS and what they report. I was the first to post their report here on this forum for the edification of other traders in this community.

75% of U.K. + 75% of U.S. (total volume numbers) represents far more liquidity than what FXCM is offering through its "10 Bank Product." Only a very desperate firm would even attempt to argue otherwise. That also leaves out of your equation, 25% of the rest of the world. Yet, your traders cannot execute on 0.000025% of the total daily volume contained in just one pair - the EURUSD This does not even include the other pairs!

Who are you trying to kid?


I stand by my post that you said we have fixed spreads and this is not true.

Fixed simply means that FXCM so manipulates the spreads, such that they do not represent TRUE Interbank spreads from the vast depth and breadth of liquidity found on other real STP/ECN 'type' platforms. That's what "fixed spreads" mean. You can't promise "tight spreads" unless you are manipulating them to begin with - pure and simple. Why? Because that's part of what makes real Interbank liquidity so deep - it's continuously producing spreads that are by definition not tight, which cuts against the grain of the FXCM marketing hype were it virtually promises "tight spreads."

Now, what would truly produce so-called "tight spreads," would be more genuine competition on your trading platform and not the behind the scenes forced agreements between liquidity partners that make it "appear as though" more liquidity actually exists. Healthy competition has the net effect of lowering prices (Econ 101). If the FXCM platform had true Interbank depth and breadth of liquidity, there would often be times when the customer was trading with No Spread at all as seen on other, more liquid trading platforms.

A sophisticated Bucket by any other name, is still just fancy way to bathe your car.


Neither are FXCM’s spreads “manipulated” by an algorithim for FXCM’s benefit. Our website explains how the NDD Price feed works: “When a customer clicks on a price, they are actually clicking on a price from the bank that currently has the best bid or offer, plus our markup.” http://www.fxcm.com/fxcm-forex-execution.html .

Then by physical and logical definition, FXCM must manipulate the price feed, or there would be no so-called "Best Bid or Offer." You keep trying to have your cake and eat it too. If the pricing was real and robust, then you would present liquidity at true depth of market.

You can't make the claim of No Price Manipulation out of one side of your mouth, then turn right around in the VERY SAME BREATH and claim "Best Bid Algorithm + Markup" out the other side of your mouth. If FXCM were the real deal, then it would simply charge a straight (flat) commission with no price feed manipulation; show all market depth available under its platform and allow the Trader to do what the Trader does naturally, which is engage in business transactions that are to the benefit of the Trader. Pure and simple. Such a platform would also provide the Trader with a full spectrum of access to a broader and deeper pool of liquidity that more closely approximates the full depth and breadth of what mainstream Interbank has to offer. This should be crystal clear at this point with zero ambiguity.

When FXCM claims "Best Bid" - that's a very misleading statement. Why? Because how on earth can FXCM or the Trader actually know what "Best Bid" even looks like, when FXCM is not providing the Trader with direct Interbank or Forex Access to anywhere near its rich and robust scope. Case in point.


Whether we choose to use a fixed pip mark-up or charge a commission as with FXCM Active Trader, NDD straight through processing is operating the same. You see the best bid or offer which is determined by the 10 banks quoting on our platform.

And, ONLY from those "10 Banks" - NOT even remotely a truer glimpse into the real Interbank depth or breadth.

I think that I have proven (time and time again) inside this thread, precisely what makes FXCM a Hybrid Bucket Shop and nothing more. As long as the Newbie is fully aware of this fact BEFORE they blindly open an account with FXCM, then that's fine by me.

I have no axe to grind here - but I am sick and tired of all the hype surrounding this entire question of whether or not Retailers are trading Forex, Interbank or the Market Maker's Proprietary Liquidity Pool.

Fact:

When you trade with FXCM, you are NOT trading true Interbank prices. You are trading a Proprietary Liquidity Pool that has been constructed expressly for the purpose of sequestering a niche Retail market that thinks it is actually trading at Interbank levels. This is the truth about FXCM and Bucket Shops like it. And, nobody is going to romantically argue to the contrary successfully, here. Nobody.

I could give you dozens of prime example of what makes FXCM just another Bucket Shop. For example: Order Types. This is a telling sign that you are dealing with a Bucket Shop of some kind, one way or another. Just look at the total lack of Order Functionality built-into the FXCM trading platform. The most advanced order type that you can enter is an OCO - that's it, folks! Now, compare that to other types of trading platforms that allow the Trader true (genuine) flexibility in their order execution.

Functionality such as:

Variable Pegged Orders
Iceberg Orders
Hidden Orders
TWAP Orders, etc.,

...all such functionality helps the Trader to maximize order entry and as a direct result, helps to optimize profit potential.

Yes, in most cases, you will need larger amounts for opening accounts on platforms that offer this kind of flexible order processing on the front and back end, however, the Newbie needs to know some of the things that differentiate the Bucket Shop, from a true Interbank Intermediary.

Maximum Order Size, is another dead give-a-way that you are most likely dealing with some kind of Hybrid Bucket Shop and trading on either their books or through their Private Proprietary Liquidity Pool and NOT the full scope of Interbank.

There are plenty of other readily identifiable markers that tell you what you are dealing with, when you open up your trading account, but I am absolutely certain that I've gone above and beyond what it necessary to prove beyond a shadow of any doubt, that FXCM is a Hybrid Bucket Shop of Epic Proportions in the Retail FX "niche."

Trade there and anywhere (for that matter) at your own risk- but especially be aware of what makes a Bucket, a Bucket, indeed.
 
So, are there any real users of their service here ?



Well, I'm not an FXCM customer, but since you posted some pretty static pictures showing FXCM "liquidity," I thought it might be reasonable to post something dynamic, showing a competitors "liquidity" for the same pair.

Of course, both yours and the video below were produced on completely different dates and obviously at completely different times. The date of this video just happens to be December 20, 2009.

Note: On the youtube player, click the face of the video after it starts to watch the video on Youtube's site. After that, click the youtube player's 720p HD control to get better clarity overall and to better see the EURUSD liquidity levels.

[youtube]j3dyT4pXrUQ[/youtube]
 
Not a very impressive argument, Jason. Now, reload and try again. Only this time, select a better logical premise and check the back-door logic before you make your declaration. (did you attend any debate classes in college?)

Hi TN7,

....Getting a little deja vu seeing the same questions asked which were previously addressed. Am I going to go through your 9 page post and reply again... No. Frankly because it's a waste of time to re-address what I've already commented on and explained how NDD works.

Second, our execution works exactly as explained on our website and in previous posts. If you don't think so, then that's what you think no matter how incorrect it may be. I respect your previous knowledge of the interbank market; however, much of what you are saying is incorrect about FXCM's execution and what we offer or misleading. Our website and my posts go into much more detail on how our execution works than with just about any broker out there. I'll reiterate the basics on what we offer in terms of NDD and how it works (the in depth example can be found on the previous post).

What is NDD?
No Dealing Desk execution is what we offer retail individual forex traders. In the retail market, there are two basic types of execution you can choose between: dealing desk or no dealing desk. In the dealing desk setup, the broker makes the market and can take on the risk of your trade. In other words, if you lose they can profit and vice versa. That risk is their's to manage. On NDD, each transaction on a one-to-one basis is offset with one of 10 banks providing quotes on FXCM's platform. The risk is eliminated.

Who cares if my broker trades against me?
The problem comes with how a dealing desk manages the risk using tools such as dealer intervention, re-quotes, entry order, stop, and limit restrictions, banning particular types of EA's, etc. In the end, the broker's profitability trumps yours.

Is FXCM making a market for forex traders?
No, FXCM does not create a market for forex transactions on No Dealing Desk execution. FXCM Micro trades are currently executed through the FXCM dealing desk, and this will be changing in the upcoming months once NDD is introduced to micro accounts.

Who takes the other side of the trade on NDD?
Every trade is executed back to back with one of the world's premier banks or financial institutions, which compete to provide FXCM with bid and ask prices.

How are the quotes determined?
A best bid/offer engine sorts best bid/offer and marks them up with our standard fixed markup on the majors. This markup acts as the commission on the trade. When a customer clicks on a price, they are actually clicking on a price from the bank that currently has the best bid or offer, plus our markup.

Can I pay a commission instead of a mark-up?
Yes, if traders want to see the raw spread without a mark-up and pay commissions instead, then the Active Trader setup is available on either the FX Trading Station II, MT4 or the Active Trader platform. The Active Trader platform gives you the added benefit of depth of market if that is something you need access to.


This is the NDD product we offer. Is FXCM the best? FXCM is one of the world's largest forex brokers, but by all means compare yourself...platform, execution, customer service, resources, education. Demos are available through our website as well http://www.fxcm.co.uk/free-forex-accounts.jsp. Traders of all levels can use our service from a micro account starting with as little as $25, standard accounts can start with as little as $2,000, and the entry level for Active Trader is $25,000.

-Jason
 
FXCM announced today the opening of its newest branch office in Berlin. FXCM Germany, an affiliate of FXCM LTD (UK), is co-regulated by BaFin and the FSA. We look forward to offering local service and support to our German clients!

This is the sixth new FXCM office opened since January 2009, following new offices in Paris, Sydney, Dubai, Milan and Santiago. FXCM has big plans in store for 2010, so stay tuned for more announcements...

The full press release can be found here: http://www.marketwire.com/press-release/Forex-Leader-FXCM-Opens-Office-in-Germany-1136871.htm
 
Hi TN7,

....Getting a little deja vu seeing the same questions asked which were previously addressed. Am I going to go through your 9 page post and reply again... No. Frankly because it's a waste of time to re-address what I've already commented on and explained how NDD works.

Second, our execution works exactly as explained on our website and in previous posts. If you don't think so, then that's what you think no matter how incorrect it may be. I respect your previous knowledge of the interbank market; however, much of what you are saying is incorrect about FXCM's execution and what we offer or misleading. Our website and my posts go into much more detail on how our execution works than with just about any broker out there. I'll reiterate the basics on what we offer in terms of NDD and how it works (the in depth example can be found on the previous post).

What is NDD?
No Dealing Desk execution is what we offer retail individual forex traders. In the retail market, there are two basic types of execution you can choose between: dealing desk or no dealing desk. In the dealing desk setup, the broker makes the market and can take on the risk of your trade. In other words, if you lose they can profit and vice versa. That risk is their's to manage. On NDD, each transaction on a one-to-one basis is offset with one of 10 banks providing quotes on FXCM's platform. The risk is eliminated.

Who cares if my broker trades against me?
The problem comes with how a dealing desk manages the risk using tools such as dealer intervention, re-quotes, entry order, stop, and limit restrictions, banning particular types of EA's, etc. In the end, the broker's profitability trumps yours.

Is FXCM making a market for forex traders?
No, FXCM does not create a market for forex transactions on No Dealing Desk execution. FXCM Micro trades are currently executed through the FXCM dealing desk, and this will be changing in the upcoming months once NDD is introduced to micro accounts.

Who takes the other side of the trade on NDD?
Every trade is executed back to back with one of the world's premier banks or financial institutions, which compete to provide FXCM with bid and ask prices.

How are the quotes determined?
A best bid/offer engine sorts best bid/offer and marks them up with our standard fixed markup on the majors. This markup acts as the commission on the trade. When a customer clicks on a price, they are actually clicking on a price from the bank that currently has the best bid or offer, plus our markup.

Can I pay a commission instead of a mark-up?
Yes, if traders want to see the raw spread without a mark-up and pay commissions instead, then the Active Trader setup is available on either the FX Trading Station II, MT4 or the Active Trader platform. The Active Trader platform gives you the added benefit of depth of market if that is something you need access to.


This is the NDD product we offer. Is FXCM the best? FXCM is one of the world's largest forex brokers, but by all means compare yourself...platform, execution, customer service, resources, education. Demos are available through our website as well http://www.fxcm.co.uk/free-forex-accounts.jsp. Traders of all levels can use our service from a micro account starting with as little as $25, standard accounts can start with as little as $2,000, and the entry level for Active Trader is $25,000.

-Jason


Hello Jason,

It is all great marketing copy, I'll grant FXCM that score. In every new industry that I've witness come into fruition, there has always been a leader........... a leader in Marketing. Hands down, no questions asked, FXCM has won the Golden FX Marketing Award for several years running and it continues to do an outstanding job of printing materials, building websites and attracting new, clueless wannabe traders who will one day wake-up and realize that FXCM is a Basket Weaving Bucket Shop of epic proportions.

Having said that, here are the facts in summary:

1) FXCM trades against its own customers by taking the other side of their position.

2) FXCM does not provide real-time Interbank rates from the deepest end of the liquidity pool.

3) FXCM does not provide authentic STP (Straight Through Processing) because authentic STP can ONLY be delivered against unmolested, real-time Interbank rates, executed (per deal) by real Traders.

4) FXCM does not provide real Interbank rates to its customers (Traders) because real Interbank rates contain no "Broker Markup."

5) FXCM cannot legitimately continue to make the claim that it delivers "Best Bid/Offer" prices to its customers through its trading platform, since FXCM does not have platform specific relationships with the vast majority of FX liquidity providers that make-up the real Interbank market and thus, cannot possibly know whether or not their "Best Bid/Offer" is the Best Bid/Offer available within the broader, deeper and more robust Interbank community.

6) FXCM provides its customers (Traders) FX liquidity that can only be described as being exclusively Private and/or Proprietary in nature, having nothing to do with the larger scale depth, breadth and volume of liquidity available in the real Interbank market on a daily basis, as its single trade maximum notional value limitation of only 0.000025% of the total available (daily) market clearly demonstrates.

7) [cause I just love the number 7 for some odd reason] FXCM does not offer its customers (Traders) the ability to execute on Currency Options, which many serious minded Traders and/or Money Managers will utilizes at the core of their money management business enterprise and at the core of their Risk Mitigation strategy/protocol.

Did I miss anything important, Jason? Or, have I properly concluded business on this topic of what an FX Bucket Shop Profile looks like? ;)

FXCM = Basket [Bucket] Weaving 101 Personified.

It has been a true pleasure dialoging with you and the staff at FXCM. Many happy Buckets to you and may your 2010 Bucket be the fullest of all - just as long as the Newbie knows where you stand. Just in case you forgot, that location would be: In the Shop with Bucket firmly gripped in hand. :D

All the best for 2010, Jason!

3df10m_bucket.jpg
 
Not to belittle anyone here but I am loving the posts between Jason and TraderNumber7. It is informative, argumentative, hilariously funny, and in my opinion "priceless" on many levels... Thank you Jason and thank you TraderNumber7... :)
 
Hello Jason,

It is all great marketing copy, I'll grant FXCM that score. In every new industry that I've witness come into fruition, there has always been a leader........... a leader in Marketing. Hands down, no questions asked, FXCM has won the Golden FX Marketing Award for several years running and it continues to do an outstanding job of printing materials, building websites and attracting new, clueless wannabe traders who will one day wake-up and realize that FXCM is a Basket Weaving Bucket Shop of epic proportions.

Having said that, here are the facts in summary:

1) FXCM trades against its own customers by taking the other side of their position....

Facts in summary...by leading off with the first one that's blatantly false about NDD? :rolleyes: Our website and marketing material is regularly audited by our regulators so I'm not afforded the same opportunity to make stuff up.
 
Not to belittle anyone here but I am loving the posts between Jason and TraderNumber7. It is informative, argumentative, hilariously funny, and in my opinion "priceless" on many levels... Thank you Jason and thank you TraderNumber7... :)

Hi traderdesk,

Welcome to the thread! :cheesy:

Cheers,

Jason
 
Facts in summary...by leading off with the first one that's blatantly false about NDD? :rolleyes: Our website and marketing material is regularly audited by our regulators so I'm not afforded the same opportunity to make stuff up.

Trader7 nails it. :clap:

FXCM is nothing but Marketing Hype!
 
So TN7, if you're a retail punter, quite happy with active trader from fxcm, who would you go with to improve your lot (excuse the pun)...FXPro, Alpari...? Bearing in mind this is a suite of forums dedicated towards helping retail...
 
So TN7, if you're a retail punter, quite happy with active trader from fxcm, who would you go with to improve your lot (excuse the pun)...FXPro, Alpari...? Bearing in mind this is a suite of forums dedicated towards helping retail...


Well, I've put up a thread where I list the retail firms that I would give a second look -if- I were a retail trader, so you might want to check that thread (my Best in FX Awards for 2010).

The truth is that, if you are a pure retail trader, while there are choices available to avoid crap shoots like FXCM, there are painfully few. One my biggest problems with these retail outlets (literally - like walking down the center of a overblown indoor Mall in the U.S.) is their phony marketing campaign that the Newbie, unless he/she really does their homework, gets sucked into and spit-out the other end.

400:1 leverage? What's up with that nonsense. What retail forex Newbie understands how to handle that kind of leverage? Heck, I would classify myself as one of the top traders in the world when it comes to currency and even I would not touch 400:1, except under the rarest of circumstances and market conditions - but even then, it wold only apply to a specific trade.

Variable Dynamic Leverage. If the so-called Retail Intermediary were really out there thinking about the "little guy," then they would have trading platforms that mirrored the functionality that thinking people need. As a successful Trader, how many times have you asked yourself: "If I only had a way to vary the leverage with each trade, to match the output (probability) of my trade signal." Why are you pegged to leverage levels that run in increments of powers? You can have 25:1, but you can't have 27.5:1? You can have 50:1 and 100:1, but you can't have 71.3:1? Think about who is creating the "gearing effect" on the retail side and why their platforms are so inflexible.

Synthetic Pairs with Ratio Allocation. What choice do I have as a Newbie, if I want to enter the market with a singular trade consisting of 60% EURUSD, 20% GBPUSD and 20% AUDJPY. Sure, I could use Excel on the side to pre-calculate the ratio's for me and then just chose the lot levels correspondingly, but I still have to manually enter that ratio combination. But, this should not be something requiring "special platform golden key gatekeeper access" to do on a daily basis at the retail level. If these Retail Brokers were worth their weight in salt, then their trading platforms would allow the retail trader to create these synthetic instruments, save them in a Synthetic Instrument Folder and make them available under a drop-down menu, on the Market or Entry Order dialog - complete with built-in ratios that can be edited on-the-fly at order execution time.

I could go on and on, but it would be precisely the same old song. Most of these Retail Bucket Shops don't truly want you to be successful, because too many of them are too darn busy taking the other side of your position and LYING to you about it. Plain and simple.

So, while I did create my 2010 Awards list, I did have to hold my breath as I selected some of them. I think if more retail traders would support firms like Divisa Capital (DCFX: www.divisafx.com) with its all Currenx Hub configuration (either Traditional or Viking), then I truly believe that most of these Bucket Hack Jobs would start to disappear. I think Intermediary Agnostic platforms like ProTrader's PT Multistation, could dominate the retail market space and take-over from platforms like MT4. PTM needs work, bugs need to be fixed, but that's all part of the teething process. You retail guys/gals should really look into it, to see if it has application for you.

If you have the cash to open such an account, you might also want to take a look at FXall - http://www.fxall.com/liquidity_overview.html. Take a close look at this "River of Liquidity" and then compare this to what Jason is telling you about FXCM's "10 Bank" Oceanic Voyage across the Atlantic that they offer you.

There is simply zero comparison here, relative to FXCM. If you can get on the FXall platform, then I highly recommend it. From liquidity depth, price transparency, anonymity, order routing (genuine STP through an ECN) to order type flexibility, it is hard for the mid-level active trader to go wrong on this platform. In fact, you wont find a single click notional value restriction on FXall, like you will on FXCM. That is because this platform gives you access to a much deeper level of FX overall liquidity and there is no Intermediary-Counterparty rabbit hole that makes you subject to price manipulation, spread manipulation and/or entry/exit manipulation. You are free to simply trade the market on this platform.

As always, do your own homework - I'm just writing about what I know.

Or, of course, one can continue trading with FXCM. Not a choice I would make personally, but it is still a choice nonetheless. I just don't like being lied to.
 
A Leading Online Global Broker Presents Forex, Oil, Gold and Indices on One Platform

logo-fxcm.gif


Direct Market Access to Some of the World's Largest Forex Liquidity Providers with Enhanced Order Execution from FXCM

London, 31 March 2010FXCM LTD has launched new trading instruments. Now, in addition to forex, traders can trade oil, gold and global stock indices on one platform.

FXCM LTD began offering CFD trading in September 2009. Due to its increasing popularity, FXCM has decided to make CFD trading more widely available and has included all instruments on one platform. Watch Video

Why Trade CFDs with FXCM?
  • No Re-Quote Trade Execution
    FXCM will not interfere in client trading by re-quoting trades.
  • No Debit Balance
    Unlike trading with other providers, margin trading with FXCM will guarantee that traders will never have to pay a deficit balance as a result of trading.
  • No Commissions,* Tight Spreads
    Use less money to trade more. With FXCM, traders are able to trade commission-free with competitive spreads.

With the FXCM Trading Station’s one-click order execution, traders will never again be more than a few seconds away from putting their opinions to the test!

For any questions, please call FXCM currency specialists, who are available 24 hours a day, at +0808 234 8789, or by e-mail at [email protected].

About FXCM:
Forex Capital Markets (FXCM) is a leading global forex broker that caters to both retail and institutional markets. Founded in 1999, FXCM is one of the largest brokers, regulated by several of the world’s most respected financial authorities.
At the heart of FXCM’s client offering is No Dealing Desk† forex trading. FXCM Clients have Direct Market Access to some of the world's largest forex liquidity providers; enabling FXCM to offer clients spreads as low as 1 pip on major crosses. Clients also have the benefits of mobile trading, one-click order execution and trading from real-time charts. FXCM’s CFD product offers no requote trading and allows traders to trade oil, gold, silver and stock indices, along with forex, on one platform. In addition to currency and CFD trading, FXCM offers educational courses on forex trading, and provides free news and research through DailyFX.com.

* FXCM is compensated through the bid/ask spread except where otherwise noted. Please note commission charges apply for certain classes of non-standard accounts such as Active Trader. For additional information, click here.
† Please note, FXCM Micro, in its discretion, may or may not offset individual transactions unlike transactions in most FXCM Standard accounts.

Risk Disclaimer: Trading FX, CFDs and Spread Betting on margin carries a high level of risk, and may not be suitable for all investors read full disclosure.

Media Contact:
Jaclyn Sales, [email protected], 1-646-432-2463
 
Sean Hyman to speak at Currency Trading Expo in Las Vegas, Hosted by FXCM

Join FXCM at the Rio in Las Vegas, May 3–4, 2010, for a two-day Currency Trading Extravaganza

Wildly popular fundamental and technical strategist Sean Hyman will speak at FXCM’s Currency Trading Expo, which will be held in Las Vegas on May 3 and 4, 2010. Sean has worked in equities and forex as a trader, analyst, and educator for over 17 years, and is currently the moderator of the DailyFX forums. He is considered to be a leading expert in his field as well as a compelling presenter whose services are a regular addition to trading conferences each year. Attendees will have the opportunity to hear him speak about three special topics:

  • Introduction to FXCM and the Forex Markets: Sean will discuss pips, lots, and the advantages of the forex market over the stock market.
  • Using Commodities (Oil and Gold) to Trade Currencies: Learn how gasoline/oil, gold, and the Dow Jones Industrial Average correlate to the currency markets.
  • Forex Cross Currencies and Emerging Markets Currencies: Learn the advantages of trading crosses over “the majors” and how to leverage the most exciting emerging market currencies.

You can register and view the complete workshop schedule and speakers list at: http://clk.atdmt.com/FXM/go/207215842/direct/01/

About FXCM Holdings LLC

Forex Capital Markets (FXCM) is a leading global forex broker that caters to both retail and institutional markets. Founded in 1999, FXCM is one of the largest brokers, regulated by several of the world’s most respected financial authorities.

At the heart of FXCM’s client offering is No Dealing Desk* forex trading, Clients have Direct Market Access to some of the world's largest forex liquidity providers, enabling FXCM to offer clients spread as low as 1 pip on major crosses. Clients also have the benefits of mobile trading, one-click order execution and trading from real-time charts. FXCM’s CFD product† offers no requite trading and allows traders to trade oil, gold, silver and stock indices, along with forex on one platform. In addition to currency and CFD trading, FXCM offers educational courses on forex trading, and provides free news and research through DailyFX.com.

*Please note that FXCM Micro, in its discretion, may or may not offset individual transactions unlike transactions in most FXCM Standard accounts.

†MetaTrader 4 and CFD accounts are available through Forex Capital Markets Ltd.


Risk Disclaimer: Trading FX, CFDs and Spread Betting on margin carries a high level of risk, and may not be suitable for all investors read full disclosure.
 

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FYI: FXCM's trading hours Friday through Monday for the Easter Holiday period will remain the same. So trading closes on Friday April 2nd at 4:00pm EDT and will resume on Sunday April 4th at 5:15pm EDT.

Also, tomorrow is NFP. As if NFP were not volatile enough, tomorrow is also Good Friday, a public holiday in many countries. Lower liquidity than normal due to the holiday could increase volatility. Be careful!

-Jason
 
A platform update is scheduled for the FX Trading Station II this weekend and the most noticeable change you will see is with the charting. Here's a preview of some of the additional features to look for:

1. Heiken Ashi and Fractals

heikenashifractals.jpg


2. ZigZag

zigzag.jpg


3. Improved Pivot Point Indicator: You can now set the candle period for the pivot independent of the chart time frame you are viewing. In other words you can base the pivot point off of the daily candle while looking at the 5 minute chart. Previously, the pivot was based off of the candle period of the chart period you were viewing. Also, the pivot point will now be located in the indicators list rather than as an icon in the icon menu at the top of the chart.

pivotpoints.jpg


4. Chart Signals: Basic feature (for now) added to the charts. You can have a signal plotted onto the chart for basic indicator signals uses such as moving average crosses, RSI oversold/overbought levels, etc.

movingaveragesignal.jpg


5. Charts in the Market Order window: View a 5 minute chart of the currency pair you are about to trade

marketorderchart.jpg


And more which I will share on Monday...

Please feel free to post any feedback on Sunday after you've had some time to play around with it.

-Jason
 
Many of the FXCM forex accounts now have the ability to trade CFD products such as gold, oil, silver, and stock indices. If you trade any of these products, we recently lowered the spreads. Here's a table with the old and new spreads:

cfdspreads.jpg
 
According to FXCM website, its a NDD for standard accounts, which need $2000+

Micro accounts are not gauranteed to be NDD?

Is it 100% correcto that fxcm is NDD for standard acounts?
 
Hi Jason,

Can you tell me if volume information is available for indices on the fxcm platform I have had a look but cannot see this anywhere??

thanks Ben
 
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