Fxcm Spreads

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dsalas

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Hey guys i have been in demo with FCM and now going live, my concern is with spreads they tend to change dramatically, has anyone experience this, Trying and testing is demo sucks and wat they offer are the lowest according to their site bit HA we know it is not true, Now Do you think that their spreads are uncontrolled and wide or not? has anyone here tested different brokers who can give some advice,


thanks
 
human123 said:
If you are looking for ECN broker, I think you would like FXCBS Forex Online Trading, Low Spread, Trading Software, Free Signals professional account option, they have MT4 ECN platform. Spreads are low and reasonable, you can run EA, or scalping. I have been trading with them for a while and I like it.

Leverage: 100:1
Min. deposit: $10k
Min. lot size: 0.5
Click to expand...

Hi ,
Can some one explain what does this mean ?
2 - 3 Pip spread on all fx ,
Because i am new and going to open an Mini account (500$) with www.gtltrading.com ,
for gold mini 0.1 lots
they charge 10$ commission on 1 trade ,
is it too much commission ?,
the good thing is they provide interest free,
 
dsalas said:
Hey guys i have been in demo with FCM and now going live, my concern is with spreads they tend to change dramatically, has anyone experience this, Trying and testing is demo sucks and wat they offer are the lowest according to their site bit HA we know it is not true, Now Do you think that their spreads are uncontrolled and wide or not? has anyone here tested different brokers who can give some advice,


thanks
Click to expand...

If you are talking about FXCM, their spreads change "dramatically" once you start making money. See this screenshot of two (actually three) trading accounts. The account on the left has been making money for about 9 months, the accounts on the right are new.

I read a great article on this ---> http://www.tradingmarkets.com/forex/trading-lessons/how-your-forex-broker-makes-money-839961.html

All brokers do this, not just FXCM. Although they won't own up to it. For me it is no big deal since the spread cuts into my trades very little, since I trade daily charts, for relatively big chunks, but for the scalper it can mean the death of a profitable system.
 

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Gold is gold said:
Hi ,
Can some one explain what does this mean ?
2 - 3 Pip spread on all fx ,
Because i am new and going to open an Mini account (500$) with www.gtltrading.com ,
for gold mini 0.1 lots
they charge 10$ commission on 1 trade ,
is it too much commission ?,
the good thing is they provide interest free,
Click to expand...

Hi Gold

In my opinion too many traders focus on the spreads, the real issue is whether your broker is likely to fold up shop and disappear. Finding a broker that is in the USA or UK is your best bet. A broker in the Bahamas or Malta? ..... probably not a good idea. The UK has probably the best laws (for the trader), make sure your broker is in the FSA register and registered with the FSA, sometimes you will find brokers with offices in the UK, but they are EEA authorised, this is different from being FSA regulated... so be aware of that.

If you find a semi-reputable broker in the UK who is FSA regulated you will probably be ok. The US is pretty good at regulating as well, they have regulated the leverage right out of the country (n)

You may always check a broker at the FSA register here:

http://www.fsa.gov.uk/register/firmSearchForm.do
 
FX_jake said:
If you are talking about FXCM, their spreads change "dramatically" once you start making money. See this screenshot of two (actually three) trading accounts. The account on the left has been making money for about 9 months, the accounts on the right are new.

I read a great article on this ---> http://www.tradingmarkets.com/forex/trading-lessons/how-your-forex-broker-makes-money-839961.html

All brokers do this, not just FXCM. Although they won't own up to it. For me it is no big deal since the spread cuts into my trades very little, since I trade daily charts, for relatively big chunks, but for the scalper it can mean the death of a profitable system.
Click to expand...

I use FXCM and have never seen spreads as tight as the account on the right, even when I first opened the account. The higher spreads as shown on the left are pretty typical of what to expect from my experience with FXCM.

Also, as I understand it, FXCM offer no dealing desk execution, which means that they are impartial as to whether you make or lose money. They make money by widening the spread from the interbank rates, not from whether or not your trade is a winner or loser.

Obviously something is going on here as I have never seen spreads like those on the right account. Wish I had. Feel free to correct me if you think I am wrong...

As for the original remark about spreads varying 'dramatically', I find they flick around with a pip or so, but not more than that, except when the market first opens.
 
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FX_jake said:
If you are talking about FXCM, their spreads change "dramatically" once you start making money. See this screenshot of two (actually three) trading accounts. The account on the left has been making money for about 9 months, the accounts on the right are new.

I read a great article on this ---> http://www.tradingmarkets.com/forex/trading-lessons/how-your-forex-broker-makes-money-839961.html

All brokers do this, not just FXCM. Although they won't own up to it. For me it is no big deal since the spread cuts into my trades very little, since I trade daily charts, for relatively big chunks, but for the scalper it can mean the death of a profitable system.
Click to expand...

FXCM has multiple account options: micro, standard, and active trader. All 3 are listed here along with the minimum deposit. On the micro and standard 10k account, FXCM is compensated by a pip mark-up added onto the best bid/ask spread being streamed onto the platform by the banks. On the active trader setup, the pip mark-up on the spread is reduced and you pay a separate commission instead. So screenshot is most likely showing a standard account on the left and an active trader account on the right. This is why the spreads are different on each platform, and spreads based on profitability with NDD/STP is more fitting of a conspiracy theory.

Why do we offer reduced spreads with commissions on active trader? FXCM's revenue on NDD/STP forex execution is generated based on trading volume and earning the spread mark-up/commission on that volume when you place a trade. The more trades you place on the platform, the more revenue generated for FXCM. This is contrasted with a dealing desk broker which can earn additional revenue through their traders losses and controlling the market. The active trader setup is designed to reward traders for higher volumes with lower commissions. As your trading volume goes up, costs can also go down. There's a demo on the active trader page if you would like to view the spreads, and the setup can be requested on the FXTSII, Active Trader, and MT4 platforms.

-Jason
 
Barramundi said:
I use FXCM and have never seen spreads as tight as the account on the right, even when I first opened the account. The higher spreads as shown on the left are pretty typical of what to expect from my experience with FXCM. Perhaps they identified me as a winner straight up?

Also, as I understand it, FXCM offer no dealing desk execution, which means that they are impartial as to whether you make or lose money. They make money by widening the spread from the interbank rates, not from whether or not your trade is a winner or loser.

Obviously something is going on here as I have never seen spreads like those on the right account. Wish I had. Feel free to correct me if you think I am wrong...

As for the original remark about spreads varying 'dramatically', I find they flick around with a pip or so, but not more than that, except when the market first opens.
Click to expand...

Hi Barramundi,

Tighter spreads are offered on the active trader setup with FXCM since you're paying a separate commission. I can only imagine the screenshot and post was structured in a way to be intentionally misleading. You can view spreads with the active trader setup by registering for an active trader demo account: http://www.fxcm.com/active-trader.jsp

Multiple banks and financial institutions compete to provide FXCM with bid and ask prices. The best bid/ask price is then streamed onto the platform which you then view as the bid/ask spread. A pip mark-up (essentially a commission) is added onto the best bid/ask price then displayed onto the standard 10k and micro account. On the active trader platform, the pip mark-up is reduced and you pay a commission instead. This is why the spreads will be tighter on the active trader setup when compared to the standard 10k and micro platforms.

-Jason
 
Thanks for that Jason, I had forgotten about your active trader option, but it certainly looks quite appealing.
 
I would think twice on the spreads explanation.....

Posted this in the main FXCM thread..... warning bells for now at least.

Heads up all FXCM have a class action lawsuit against them.

Class Action Lawsuit Against FXCM. http://finance.yahoo.com/news/Morgan....html?x=0&.v=1

The Plaintiff, William H. Sanders, of Muscogee, Oklahoma, brought the action on behalf of himself and all other similarly situated FXCM customers, accusing FXCM of fraud by misrepresenting itself as a trading platform that is free from dealer intervention or manipulation. Instead, Sanders alleges, FXCM uses a number of devices and tricks, including software applications, designed specifically to interfere with customers’ trades.
The Complaint further alleges that FXCM engaged in a pattern of racketeering activity by collaborating with its software developers and programmers to develop a “diabolical” software application that provides FXCM with a myriad of tools and system commands with which to interfere with customers’ trades, including routing trades to “slow” servers and sending false “error” messages when customers attempt to close out profitable trades.

More info on this at Forex factory http://www.forexfactory.com/showthread.php?t=280376
 
Jason Rogers said:
So screenshot is most likely showing a standard account on the left and an active trader account on the right. This is why the spreads are different on each platform, and spreads based on profitability with NDD/STP is more fitting of a conspiracy theory.

-Jason
Click to expand...

All brokers do it. The "Active Trader Account" - over 300k is on the Left and the standard account is on the Right. Let me state that again so that there is no confusion. The "Active Trader Account" - on the Left, has a wider spread than the "Standard Account" on the right.

The difference between the Active Trader Account and the Standard Account is this:
- The Active Trader Account has consistently made money for several months
- The Standard Account is new and has not

FXCM is by no means the only broker that does this, I hold no grudge and continue to refer traders to FXCM. Slippage and wide spreads always, and I do mean always begin to appear after an account makes money for a few months. The broker is irrelevant. MT4 platforms are notorious for this, and if you have any doubts you may call Metaquotes, explain to them that you are going to open up a retail forex brokerage and eventually they will upsell you on add-ons that you may use, as a broker, to discourage your annoying, profitable traders.


See this post for another trader's test of another large forex broker - Pipscooper's post in the middle of the page -----> http://www.elitetrader.com/vb/showthread.php?threadid=56137&perpage=6&pagenumber=19
 

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FX_jake said:
All brokers do it. The "Active Trader Account" - over 300k is on the Left and the standard account is on the Right. Let me state that again so that there is no confusion. The "Active Trader Account" - on the Left, has a wider spread than the "Standard Account" on the right.
Click to expand...

Jake, I have a standard account and my spreads are comparable to the ones on the left. I would never expect to be offered spreads as tight as those on the right with a standard FXCM account. It just doesn't make sense that spreads could be that tight, given that FXCM widens the spread to make their cut....
 
FX_jake said:
All brokers do it. The "Active Trader Account" - over 300k is on the Left[/B] and the standard account is on the Right. Let me state that again so that there is no confusion. The "Active Trader Account" - on the Left, has a wider spread than the "Standard Account" on the right.

Click to expand...


Prove it...
 
Jason Rogers said:
Hi Barramundi,

Tighter spreads are offered on the active trader setup with FXCM since you're paying a separate commission. I can only imagine the screenshot and post was structured in a way to be intentionally misleading.
Click to expand...

Join up the following phrase to make legible sense; Sherlock, 5hit and no..;) Jason, I need a bit of advice (off forum) will mail you Sunday.
 
FX_jake said:
All brokers do it. The "Active Trader Account" - over 300k is on the Left and the standard account is on the Right. Let me state that again so that there is no confusion. The "Active Trader Account" - on the Left, has a wider spread than the "Standard Account" on the right.

The difference between the Active Trader Account and the Standard Account is this:
- The Active Trader Account has consistently made money for several months
- The Standard Account is new and has not

FXCM is by no means the only broker that does this, I hold no grudge and continue to refer traders to FXCM. Slippage and wide spreads always, and I do mean always begin to appear after an account makes money for a few months. The broker is irrelevant. MT4 platforms are notorious for this, and if you have any doubts you may call Metaquotes, explain to them that you are going to open up a retail forex brokerage and eventually they will upsell you on add-ons that you may use, as a broker, to discourage your annoying, profitable traders.


See this post for another trader's test of another large forex broker - Pipscooper's post in the middle of the page -----> http://www.elitetrader.com/vb/showthread.php?threadid=56137&perpage=6&pagenumber=19
Click to expand...

Do my eyes deceive me? On the right can I see a balance of 138K (suggesting Active Trader account)...?
 
FX_jake said:
If you are talking about FXCM, their spreads change "dramatically" once you start making money. See this screenshot of two (actually three) trading accounts. The account on the left has been making money for about 9 months, the accounts on the right are new.

I read a great article on this ---> http://www.tradingmarkets.com/forex/trading-lessons/how-your-forex-broker-makes-money-839961.html

All brokers do this, not just FXCM. Although they won't own up to it. For me it is no big deal since the spread cuts into my trades very little, since I trade daily charts, for relatively big chunks, but for the scalper it can mean the death of a profitable system.
Click to expand...

What a 5hite article, he describes the top 5% as lucky...total 'nob 'ed..
 
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