platform reality check

[jonj]

Hi yawl,
im a newbie following/learnin the fx markets for a couple of years now and want to open a real account sometime soon.iv been trading on practice accounts on just about every platform under the sun and seem to do allright (as long as i dont get bored!)
what i want to know,and i feel there will be many newbies like me,is:how different do the platforms perform with real accounts????? iv heard or read many tales of "brokers trading against you" or "large price spikes that conveniently stop u out"wich all sounds a bit dodgy to me,doesnt anyone monitor these people!! i would also like a clear idea about how much trading will cost me in reality eg commisions (if theyre charged)tax etc to make it easy for me,if i made 100 pips on eur/usd with a non commision broker,how much can i spend that month??may be a daft question but us newbies want to know some hard facts.
so please contribute to this thresd and give us newbies an idea of what we are up against.thanks

 

[Rhody Trader]

Taking the latter part of your inquiry first, the commission charge will depend on the broker/dealer you use and should be clearly outlined by them. If you're using an ECN there will be a commission. If you go with a market maker/dealing desk broker then there's no commission. In terms of getting your money out, that too varies a bit between brokers and is worth investigating. In general terms, though, if you book 100 pips (meaning you've closed the trade and that's your gain) then you'll be able to take it all out whenever you want.

As to the "dodgy" stuff, by definition a market maker dealer will take the other side of your trade. Of course they are generally also taking the other side of someone else's opposing trade at about the same time, so it's a wash. The better firms will not remain directionally exposed to the market because they could very easily get caught out by an unexpected move, just like any trader.

Basically, if you trade smartly and don't go with some obscure broker nobody's ever heard of based in a third world country, you'll be fine.

 

[jonj]

thanks for your reply,allready feel less stressed!!
eveytime i get to like a platform i read loads of bad styff about them and start my search all over!at the moment my favoured 2 are oanda(although would prefere 100:1 margins)and odl securities, if anyone has any earth movin news about either id appreciate it

 

[Rhody Trader]

You will hear very little bad about Oanda, except maybe about their fairly basic charting. Most likely you won't need more than 50:1 leverage either.

 

[BSD]

You will hear very little bad about Oanda

Absolutely ! Great outfit.

 

[jonj]

thanks again, have to say though i prefere the metatrader platforms as technical trading is what interests me.any remarks on odl or any trust worthy metatrader platform will also be a great help,eg what happens if they dont meet the new expedted 20mill net deadline?and isthere any diference to the real account performance as to the demos??
thanks for your time on this stuff by the way

 

[northtreetrading]

thanks again, have to say though i prefere the metatrader platforms as technical trading is what interests me.any remarks on odl or any trust worthy metatrader platform will also be a great help,eg what happens if they dont meet the new expedted 20mill net deadline?and isthere any diference to the real account performance as to the demos??
thanks for your time on this stuff by the way

Have you given any thoughts to equity trading? Nasdaq and NYSE. Although forex accounts can offer high leverage, equity markets such as Nasdaq offer market depth information that is just not available on forex e.g. level 2 screens.

 

[jonj]

Have you given any thoughts to equity trading? Nasdaq and NYSE. Although forex accounts can offer high leverage, equity markets such as Nasdaq offer market depth information that is just not available on forex e.g. level 2 screens.

my interest in trading started in stocks and shares but found the fx markets more volatile and more predictable,also much easier for me coming with zero experience in the financial world(chef by trade)i believe the min accounts in equity platforms are much higher?without the benefit of mini/micro lots?i plan to keep my losses, due to inexperience down to a min without wasting my capital.
i also thought level II prices were available for the fx or is this diferent?either way it is something i am not yet familiar with.

 

[Rhody Trader]

my interest in trading started in stocks and shares but found the fx markets more volatile and more predictable,also much easier for me coming with zero experience in the financial world(chef by trade)i believe the min accounts in equity platforms are much higher?without the benefit of mini/micro lots?i plan to keep my losses, due to inexperience down to a min without wasting my capital.
i also thought level II prices were available for the fx or is this diferent?either way it is something i am not yet familiar with.

The forex market is not more volatile than stocks. A single stock can change value 60% in a single day (Yahoo on the Microsoft takeover news, for example). It would take ages to see that kind of change in a forex pair.

Also, I would actually say that stocks are an easier market than forex. They are much less complex since they represent just one thing (a company), as opposed to being the relationship between two country's economic and financial strength. The fundamentals are much easier to sort out with stocks.

That said, the forex market does have much lower financial barriers to entry and the 24-hour nature makes it more readily accessible.

As for Level II, you won't find that sort of information as easily available in forex. And even if you can find it, since the market isn't unified, it's only a fractional representation.

 

[jonj]

i agree some stocks can be more volatile on some days but how many move 60/80 pips on average EVERYDAY?e.g. as of writing this(9.15,euro time)a quik count on the pairs iv been trading this mornin have moved between 45 pips(eur/usd)to around 250 pips(gbp/yen)with the gbp/usd around 60 pips and usd/chf around pips.How many stock traders can see that much movement in ALL they are following?
also being ,almost,a soley technical trader the fundamentals are much less important to me.i tend to stay away from trading news releases

 

[Rhody Trader]

i agree some stocks can be more volatile on some days but how many move 60/80 pips on average EVERYDAY?e.g. as of writing this(9.15,euro time)a quik count on the pairs iv been trading this mornin have moved between 45 pips(eur/usd)to around 250 pips(gbp/yen)with the gbp/usd around 60 pips and usd/chf around pips.How many stock traders can see that much movement in ALL they are following?
also being ,almost,a soley technical trader the fundamentals are much less important to me.i tend to stay away from trading news releases

First, news releases are not fundamental trading. That's just playing market expectations on a singular event.

Getting to your main point, do you realize how small those moves are that you're talking about? In EUR/USD 100 pips is like 0.7%, and that 250 pips in GBP/JPY is only about 1.2%. I could make you a very long list of stocks with daily ranges averaging 2% and better.

 

[jonj]

yeah i know trading news isnt fundamental trading,it was just a by the way point.but fair enough,point taken.
one q. though, are the margins available in the fx markets also available in the stocks? cos with a 100:1 margin 100 pips obviously means much more to my account than 0.7%,it affectivly doubles the capital invested,gross,is this the same situation in stocks??
one more point,although im not arguing against you not having any experience in this,the fx markets must be a lot safer market in the sense that america aint gonna go bust in after hours trading?!