Best Thread Other Side of the Screen

MajorMagnuM

Legendary member
9,284 888
a book and b book, exactly as i thought. Good business model, take opposite side of b book trades and put to market and follow the a bookers. Is there a better business plan on the face of the planet? doubtful
 

LLSS

Junior member
16 21
Thanks to the mods for opening this thread up again for me. I will try to answer as many relevant questions as possible with a good amount of detail but due to work etc my responses may be sporadic.

First up then:

First up, a big thank you for doing this.(y)

Quick question: I had a problem with SB company a good while back now, the basic gist was i was using a P&C stop to enter right near (less than 2 pts away) the market in dax with a fixed 1pt spread. Modest size around 8pp iirc
Order ex: P stop to sell at 70 / C stop to close 71.1
yeah, i know!:eek: :cheesy:

One morning i started to receive constant slippage as opposed to the pinpoint (for the most part) fills id been getting. Rang up and asked whats changed, "nothing" was the reply.
Unhappy with that i asked a fellow trader to mirror an order (same time/price) to compare fills. I got slipped and he didnt. Back on the phone to them, the most i got was "you wernt being very fair to us", which of course i wasnt. They wouldnt admit that i was being treated any different when it was obvious that i was.

I trade a bit different to that these days, all limits and no hard stops, but would defo be interested to hear the typical view of me and my previous behavior from the other side of the screen.

Cheers
D


Haha well to be honest it will depend on the firm and I can't speak for everyone but I would view you as a bit of a cheeky sod but also with some form of admiration. I think you're an t*t because you make my life/job harder as I have to trawl through loads of your data to find out what you're up to but admire your efforts for finding a loophole. It's also the fact that I know that you know what you're doing is taking the mick a bit.

At the end of the day though we try to mimic the real underlying market environment as closely as possible, and you and I both know (I presume from your wording) that in real market conditions these tactics simply don't work.

In a related example, we faced a similar thing previously where a client would try to place a buy and sell stop each side of the market during big data. Fine, but when he got slipped as the price thundered one way or another he would then ring up to complain when he got slipped. Even after showing screenshots of the underlying market at 1 second before/during/1 sec after where price had gone from 1250 to 1247 (Gold) in a split second, he wouldn't understand why he couldn't get filled at 1249. So in his case we simply widened the price he was allowed to place his orders at to negate slippage. Imo it's a worse deal but he was happy with it :confused:
 
G

Guest36985

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Thanks to the mods for opening this thread up again for me. I will try to answer as many relevant questions as possible with a good amount of detail but due to work etc my responses may be sporadic.

Should have said this first before my posts.
Thank you for putting your head in the Lions mouth by coming on here.
Not sure why your doing it, you have your reasons but thanks anyway. I'm looking forward to a lively thread and a few 'myths' dispelled. You never know, you might learn something. :LOL: ;)
 

LLSS

Junior member
16 21
surely by the same token...it's understood that *most* sb firms tolerate 'winners' precisely because the majority regularly lose more than enough to more than cover any regular/irregular gains made by the minority of 'winners'.

BTW, when you say "Someone with a small account balance (up to $10,000.00)", *if* I may assume you worked for a UK outfit, did you mean up to 10K GBP?

Hi,

Yes from my experience meeting others in the business most clients lose money. Clients come from all walks of life, whether its a bloke punting a few hundred dollars on FX after reading it's 'easy money' online. Then there are the wealthy guys who just like to gamble and have a punt here and there. There are very few who are genuinely good though and who have the time and resources to make a go of it seriously. Hence why it really doesn't matter to us in the long term if you are a winner or loser, sure our strategy will vary, but we will always want you on board.

As for the $/£ question. Yes we are UK based but the majority of our clients are based outside the UK so we offer $/£/€ with USD being the most popular choice so often we refer to everything in USD.
 

LLSS

Junior member
16 21
If you are a market maker how exactly does it 'cost' you to move the price your quoting up. It doesn't cost a man on a market stall any more to shout Bananas £2 a bunch rather than Bananas £1 per bunch. In fact if he owns a lot of said Bananas he's actually making MORE money from other people buying while he's shafting you for having bought the option (from him) to sell them @ £1.50.
To continue the analogy if he changes the price overnight when no other 'Barrow boys' are around and your pregnant wife needs a Banana NOW! your screwed.
Now take a look at the Dow!

Hi Postman,

To answer your question as best as I can I should clarify what I meant. I meant quite literally moving the underlying market by trading on it. EG a client of ours is short and has a stop close by, I go in and start bidding the price up during out of session hours to hit his stop. This would be totally pointless and very risky seeing as the capital required (market depending ofc) would be huge, probably many times more than I would make from his trade.

I also was referring to a strictly regulated broker/MM (UK - FCA). If we ever pulled a stunt like that where we moved the markets to a price they never reached (taking spread into account) then we would have our a**e handed to us, that just wouldn't happen, especially as it's easy to prove.

If you are a broker/MM in a part of the world were regulation means little then perhaps this takes place, but people should think carefully when making decision to trust their money in the hands of unregulated firms. You basically give up your rights for a sweeter looking deal.
 
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LLSS

Junior member
16 21
Are you seriously suggesting that after the markets closed last night that normal market behavior made the prices go to above 16,030 cash equivalent value then everyone realised they'd pressed the Buy button instead of the Sell button and quickly reversed their trades bringing the price down to 15,800 now.

Market makers just kept changing the numbers on the screen until it was up where they made most money from 'punters' and then changed those prices again until they are at current levels.
When the markets are open Arbitrage can keep futures trading under control but when the markets are closed you are at the mercy of the greediest ugliest bunch of sharks in the world.
If you dont think prices are manipulated to take out stops you are deluded in my humble opinion.

Are you trading Dow Cash or Futures? I can try and get a screenshot for you if you give me a specific time (nearest 5mins) but from trying to guess what you mean I would say yes, it is possible. Bloomberg shows movement ranging from 15818 to 15982 between 21:30 and 23:02 overnight last night.

As for this statement "when the markets are closed you are at the mercy of the greediest ugliest bunch of sharks in the world." I agree, though I'd say they are present both night and day!
 
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tar

Legendary member
10,443 1,313
I also was referring to a strictly regulated broker/MM (UK - FCA). If we ever pulled a stunt like that where we moved the markets to a price they never reached (taking spread into account) then we would have our a**e handed to us, that just wouldn't happen, especially as it's easy to prove.
.

I don't think thats totally true , its not illegal to quote the price you want on a SB market , after all we're trading your market not the DOW cash , there is no such market as DOW cash anyway , not to mention the after-hours markets quoted by SB brokers like the DAX and FTSE , i have seen questionable moves in the FTSE after the futures close while there was no such move in the US futures , check attachment ...
 

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BSD

Veteren member
3,819 985
If we ever pulled a stunt like that where we moved the markets to a price they never reached (taking spread into account) then we would have our a**e handed to us, that just wouldn't happen, especially as it's easy to prove.

Isn't the Royal Bank of Scotland regulated in Great Britain ?

I know for a fact that the prices they were quoting on their marketindex platform they've since closed down had absolutley nothing to do with reality and the underlying real futures markets.

Some guy I met on a forum was trading there and asking me what real prices were, they were off on the Bund by as much as 100 points at times.

It's no wonder all these bucket shops are illegal in the USA since Livermores days and for a very good reason.

Anyone trading over the counter products, no matter if Goldman Sachs is oyur counterparty or a regular bucket shop, anyway, anyone trading products not traded on a regulated exchange, is never going going to get the real prices others get who trade on real markets, that's because OTC providers don't make their money from commissions like real brokers, they make it from having more losing than winning clients.
 
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BSD

Veteren member
3,819 985
I don't think thats totally true , its not illegal to quote the price you want on a SB market , after all we're trading your market not the DOW cash , there is no such market as DOW cash anyway , not to mention the after-hours markets quoted by SB brokers like the DAX and FTSE , i have seen questionable moves in the FTSE after the futures close while there was no such move in the US futures , check attachment ...

That's it in a nutshell.

Trading with a spreadbetter or CFD provider you are NOT trading any real market.

You're trading some derivative market they pretty freely make up as they go along with only the broadest connect with the real product.

As per also my example of the Royal Bank of Scotland, their prices on pretty much everything even during the day where always totally skewed away from anything even close to the realites of the real market.

I'm looking at the FDAX and FGBL Bund on Eurex in realtime with live prices and am willing to give the real prices at any time if anyone is interested.
 
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peakoil

Well-known member
257 38
That's it in a nutshell.

Trading with a spreadbetter or CFD provider you are NOT trading any real market.

You're trading some derivative market they pretty freely make up as they go along with only the broadest connect with the real product.

As per also my example of the Royal Bank of Scotland, their prices on pretty much everything even during the day where always totally skewed away from anything even close to the realites of the real market.

I'm looking at the FDAX and FGBL Bund on Eurex in realtime with live prices and am willing to give the real prices at any time if anyone is interested.


With all respect, when you argue that spread-betting isn't trading the real market, it could also be counter-argued that those of us who spreadbet have no problem with that fact - i.e., 'of course it's a made up market' - that is the very nature of speculating with derivatives; for which, spreadbetting could indeed be argued as just another form of derivative speculation, albeit one with certain advantages & disadvantages too. Though, for me personally, as things currently are, the advantages outweigh the disadvantages.

But I would submit this point: what usually keeps spreadbetting firms prices as close as possible to the real market is (1) competition among firms, and (2) arbitrage opportunities if prices get too out of line. They may be technically able to "freely make it up as they go along" as you argue, but the day to day reality is, and I've plenty of years seeing that very reality, they almost always don't stray far from a given underlying instrument. Still, if ever such has happened to me (& rare has it been) then a simple phone call to question any 'wild pricing' has usually resolved matters. Meanwhile, the usual initial (or first point of contact) 'price to pay', in today's competitive marketplace, for the advantages of spread-betting is - wider spreads.

LLSS your view on this argument would much be appreciated please. Thank you.
 
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darktone

Veteren member
4,016 1,084
That's it in a nutshell.

Trading with a spreadbetter or CFD provider you are NOT trading any real market.

You're trading some derivative market they pretty freely make up as they go along with only the broadest connect with the real product.

As per also my example of the Royal Bank of Scotland, their prices on pretty much everything even during the day where always totally skewed away from anything even close to the realites of the real market.

I'm looking at the FDAX and FGBL Bund on Eurex in realtime with live prices and am willing to give the real prices at any time if anyone is interested.
Perfect arbing opps then.
Please, if anyone is currently seeing prices skewed miles away from the underlying let me know as id like some free money! :p
 
 
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