thanks jason for responding...
could you tell me why the currency you are playing with is converted and then converted back again?
also for those who are interested there are some reviews here -
http://forextopten.com/fxcm/
some good, some bad but the one with regards to slippage and delayed orders, particularly the coments made by Ahmad & FX Trader half way down the page.
jason could you poss address if any changes been made recently since these posts to address slippage and delays? becasue if true, Ahmad's experience is particularly worrying.
i have come across a variety of reviews available here also
http://www.forexrealm.com/brokers-reviews/#FXCM
ooer there seems to be a lot of either foolish or truthfully unhappy people amongst a few happy people in the forexrealm link.
jason can you offer any comments re "random pip spread adjustments" and "margin calls versus stop loss hunting"?? if those posts on that link are half true it seems to happen with some regularity.
i would be one of those who would be looking to lock in the profit taking of between 10 - 60 pips on moves intraday so i would appreciate some confirmation on these comments if poss..
cheers
cb
Hi cb,
I'm not sure I fully understand what you mean by your first question about the currency you are trading with being converted and then converted again. Are you referring to the currency your account is denominated in and funding the account with the same currency?
Would be happy to give a response to some of the reviews you mentioned.
In regards to Ahmad's review of FXCM. Slippage can occur while trading with FXCM, and the concept of slippage is not unique to the forex market as it happens in the equities and futures market as well. We cannot guarantee there will be no slippage because FXCM isn't making the market. There is a limited amount of liquidity available at each price depending on what each of the 10 banks quoting are offering, and once liquidity at once price is wiped out, the order is filled at the next best price.
FXCM does not intentionally delay the execution of an order neither would it make sense to do so because we don't profiting when a trade is slipped. Whether you are filled at the price you clicked on or your order is filled 30 pips from the price you clicked on, the same amount is payed to FXCM. The prices you see quoted on the platform are marked-up from the price quoted to FXCM by the bank. Like a commission. For example, if you see the current buy price on GBP/USD is 1.6405, then the price being quoted by the bank may be 1.6404 and there's a 1 pip mark-up on the price. If your try to hit that buy price, but the order is slipped to 1.6401 (the price you see the order executed at), that indicates the next available buy price being quoted by the bank was at 1.6400 and 1 pip was added onto that price to e filled at 1.6401. So the slippage does not have an impact on FXCM's bottom line.
Trading during news is VERY risky and the chances of an order being slipped can increase. In normal market conditions you may see prices moving a pip at a time. During news events the market may move 2, 5, 10 pips between prices. The reason prices are moving erratically is because 1) banks are offering less liquidity due to their own risk management and 2) that liquidity is being eaten up very quickly by the orders trying to execute. These execution risks are outlined on our website
http://www.fxcm.co.uk/trading-execution-risks.jsp (I hope moderator doesn't mind me posting to this execution info ).
For the comment in the review saying that FXCM modified the stop price...We are required by regulations to keep detailed records for every order placed on the system. The records keep track of when the order was created, every time the order has been modified, and even the IP address used to modify the order. Every activity performed on a trade whether by the trader or by FXCM is recorded in the database so that we can go back in these situations and review the trade. Even if an order was created, modified, and later deleted by the trader without having been executed, we still keep track of all of this information. This allows FXCM, the trader, and our regulators to review any disputes to find out exactly what happened.
On the topic of stop loss hunting. If stop hunting were to occur, it would most likely happen through a market maker because the traders losses could be the brokers profit since they can take the other side of the position. In that case, locking in the traders loss locks in the brokers profit. How often this happens is debatable in my opinion. If you compare multiple brokers pricing against each other, they follow each other closely nearly all the time. A pip or two difference is the biggest difference you should see except around a news announcement when it can really vary. For FXCM, will the banks on NDD stop hunt? All orders are held on FXCM's servers so the banks cannot see where the stops are located. There are also 10 banks quoting which minimizes the chances of a bank being able to manipulate where the market pricing.
For online reviews in general, the reliability of them are somewhat questionable due to the anonymity of reviews. You don't have to register to post a review on either of those sites. But that's not to say that everything is false.
I reach out to many traders on the forums and other outlets such as twitter that have problems with trades. In many cases there's a lack of understanding how the market works and the execution risks involved. Good case in point is trading during news events. It's extremely risky. In the cases where a loss is caused due to an issue on our side, our audit team is very understanding in reviewing trades that resulted in a loss due to a problem on our side. Our system's are not perfect, but we'll try our best to correct things. We have also setup a website called fxstatus.com which we update any time there is a technical issue. The website updates every 30 seconds with the latest information.
I hope that helps (kind of a long post
).
Jason
