Worldspreads upgraded!

[qmpma1]

Refer to dealer is hard work...

Tried to place a trade, took ages and then a re-quote appeared which I suppose is a good thing as it gave me the chance not to trade since the price had moved (well it would do if you wait that long!)

IG Took the trade OK, no waiting, they made 3 points on the spread, WS after their manual intervention made er.. um.. nothing. IG have the advantage that you can set Limits and Stop losses when you place the trade which helps a lot. It would take too long on WS so I have to use mental stops & limits.

On balance I think IG may win using my current setup, as the manual intervention now pretty much cancels out the gain you would make on the 1 point spread, and the ability to set stops and limits in IG when you enter a trade is worth a point or two to me. (Not to mention the fact that you do need to actually place a trade to make money - that goes for both the customer and the vendor!)

Just did another trade, accepted after a few seconds but when I tried to get out, I was offered a price 5 points different to that which I had already accepted... I don't think this will work somehow... (IG trade worked OK by the way...)

 

[gle101]

Hi

i've been trading with worldspreads over the past couple of weeks.

I have been impressed with the pricing on EURUSD, and the fills.

However, today I have been logged out several times, I think due to inactivity. I do not class this as inactivity, this is me waiting for an opportunity to place my trades. To be logged out (which i typically discover just as i want to place a trade) is a BIG inconvenience.

Why does this happen?

Yours sincerely
jtrader.

I have not experienced this problem of being logged out. I agree, it is a big inconvenience, but I would not rule out that this could be due to a technical system problem.

 

[stevespray]

Tried to place a trade, took ages and then a re-quote appeared which I suppose is a good thing as it gave me the chance not to trade since the price had moved (well it would do if you wait that long!)

IG Took the trade OK, no waiting, they made 3 points on the spread, WS after their manual intervention made er.. um.. nothing. IG have the advantage that you can set Limits and Stop losses when you place the trade which helps a lot. It would take too long on WS so I have to use mental stops & limits.

On balance I think IG may win using my current setup, as the manual intervention now pretty much cancels out the gain you would make on the 1 point spread, and the ability to set stops and limits in IG when you enter a trade is worth a point or two to me. (Not to mention the fact that you do need to actually place a trade to make money - that goes for both the customer and the vendor!)

Just did another trade, accepted after a few seconds but when I tried to get out, I was offered a price 5 points different to that which I had already accepted... I don't think this will work somehow... (IG trade worked OK by the way...)

This sounds quite alarming. First appearances suggest that you are being 'cherry picked'. The company are simply using the movement in the price, between the moment that you click to trade and the moment that they have to accpet or reject the trade, to establish the financial viability of the proposed trade. Let me guess, once you have submitted your order (and its waiting to be dealt with) you have no way of cancelling the order? (Thus implying that you are contracted at that price where as the company are not!)

In simple terms its just a way that they maybe using to increase your trading costs without increasing the spread. If you add it up over time you will find that your 'synthetic' spread costs are larger than those advertised.

Steve.

 

[laptop1]

They let me back trading last week. but I have to say I have not experience instant execution since June. I am continuously on referred to dealer.

 

[qmpma1]

Pattern recognition...

Last week on instant fills, made money (kind of scalping, small number of well timed trades). This week after being put on "refer to dealer", losing money. I think I see a pattern here. When Marvin said "bring it on" to comments about this kind of trading, I assume this is how they deal with it.

It's OK offering people 1 point spreads, but when they take it up and start making money, putting them on dealer referral is a bit harsh me thinks. It's like wading through treacle. Or having a lagging graph (by the time they confirm the order, or re-quote you....)

Their argument that you win some you lose some I understand, but at the end of the day when you wait a few hours for the right setup and it takes a long time to enter a trade, or you are eventually offered a quote that is a number of points different and have a few seconds to decide, it is definately a disadvantage to the customer, no question.

I will need to consider revising my setup to ignore the advantage of the 1 point spread - which means WS would then be on a level playing field with the ohers - and they don't offer as much functionality... and I am on refer to dealer...

Marvin?

 

[Directional]

sounds like Worldspreads Downgraded, if you ask me (contrary to the title of this thread)

 

[gle101]

This sounds quite alarming. First appearances suggest that you are being 'cherry picked'. The company are simply using the movement in the price, between the moment that you click to trade and the moment that they have to accpet or reject the trade, to establish the financial viability of the proposed trade. Let me guess, once you have submitted your order (and its waiting to be dealt with) you have no way of cancelling the order? (Thus implying that you are contracted at that price where as the company are not!)

In simple terms its just a way that they maybe using to increase your trading costs without increasing the spread. If you add it up over time you will find that your 'synthetic' spread costs are larger than those advertised.

Steve.

In that case I am also being 'cherry picked', ha ha! No really, I think it is way too early to make any standing conclusion about the recent happenings. Previously there have been messages and requotes due to technical problems with the platform. I guess it will eventually show in the days to come. Good discussion though, it proves that this thread is functioning as it should.

 

[qmpma1]

Yes, I was impressed until the last couple of days. Instant fill and 1 point spread was great and certainly was what attracted me to WS.

I assume the refer to dealer is to stop quick trading. It certainly is not to "check the price" which is what I was told as I have a number of price feeds, and trust me, I know it is the current price when I place or exit the trade. (Also can confirm that WS's feed is fast & accurate).

I can see that by the time they get round to looking at the deal the price may have changed, so then they re-quote - but they take far too long to do this (for me anyway) and their answer of well it works both ways, so some you lose and some you win isn't true with me because of the way I trade. Once I want to get out, its going the wrong way, so the longer they take, the more I will lose - so where I lose 3/4 points on average I suddenly lose 11 like today. Not something I plan for.

It could be so they have time to hedge it, although I had assumed they automatically hedge everything so it would not matter if you won or lost and they just make the spread. On the other hand if they don't hedge everything then I can understand them not liking it when you win?

Marvin, what's the reason behind the "refer to dealer" I assume it gives dealers time do to something? (please don't say check the price) or os it just to slow the trade down?

 

[FXSCALPER2]

The real market offers about 3 pips spread variable on GBPUSD (commissions included)

A SB company says they offer instant execution on GBPUSD with a 1 pip spread

They also say they allow scalping regardless of whether you are a winner or not

Hmm... Do you see why this ain't gonna work?

 

[qmpma1]

Back on instant execution, however...

After I sent a nice email I am now on instant execution again, however it is with the proviso that I hold my position for an average of 10 minutes or more. So that rules out scalping I guess. They are concerned about scalpers that take advantage of a possible 1 second difference enabling some scalpers to take advantge by trading inside the price (not guilty, I just use traditional TA).

 

[gle101]

The real market offers about 3 pips spread variable on GBPUSD (commissions included)

A SB company says they offer instant execution on GBPUSD with a 1 pip spread

They also say they allow scalping regardless of whether you are a winner or not

Hmm... Do you see why this ain't gonna work?

It could still work if the company views the operation as a whole. If the whole operation with 1 point spread is profitable, I don't see any reason why they shouldn't except the small percentage of winners as well, regardless of whether they are short term traders or not. On the other hand if they have problems with the profit on the whole operation, I guess WS has to do something about it.

 

[Directional]

1 second and ten minutes are two very different things. Even one minute average trade should eliminate ppl who are scalping price lag

 

[FXSCALPER2]

I am sorry but you need to think this through. What you are saying, I am sure, is what WS thought when they introduced the 1 pip spread, promised instant execution and allow scalping. This is not going to happen I am afraid, because it can't. Why? Because the business model they are relying on is faulty. They can't offload your bets in the real market without losing because the cost to the client is lower than what they would get. What this really means is they have to make sure that, on balance, their clietns do not win.

What you are suggesting would work only if WS can be certain that most of their cleints would lose, on average. However, how can they be sure of that? Rely on the well known statistics? This is a shakey basis for a business, so they have to vet winning clients just to make sure. Also, remember that if they ACTUALLY offer 1 pip spread, instant execution AND allow scalping -I mean IF THEY ACTUALLY ALLOW THAT TO HAPPEN- all the 10% winners that everyone talks about will have no incentive to trade anywhere esle. WS will go out business in half a day. What would work is if all SB companies offered the same service, thereby cancelling out the benefits of trading with one. It is like natural selection: you can be certain that the winners will all trade with the one firm that will allow them to win more easily. WS have to make sure this doesn't happen. How are they going to do that? Refer to dealer,

Do you see why this ain't gonna work?

It could still work if the company views the operation as a whole. If the whole operation with 1 point spread is profitable, I don't see any reason why they shouldn't except the small percentage of winners as well, regardless of whether they are short term traders or not. On the other hand if they have problems with the profit on the whole operation, I guess WS has to do something about it.

 

[gle101]

1 second and ten minutes are two very different things. Even one minute average trade should eliminate ppl who are scalping price lag

I agree, 10 minutes a very long time. The thing is, the speed of the feed is so fast, there is very little delay to take conscious advantage of. So I am kind of surprised if WS decides to permanently go in this direction.

 

[FXSCALPER2]

This is perfectly logical to me. These guys were promising what they couldn't deliver. The idea that they are trying to eliminate lag scalpers by forcing people to stay in trades for 10 min is too funny.

After I sent a nice email I am now on instant execution again, however it is with the proviso that I hold my position for an average of 10 minutes or more. So that rules out scalping I guess. They are concerned about scalpers that take advantage of a possible 1 second difference enabling some scalpers to take advantge by trading inside the price (not guilty, I just use traditional TA).

 

[stevespray]

Morning….

Just had a nice letter from those nice people at Worldspreads declining my account application! Apparently they are “unable to accommodate” me at the present time. Makes it sound like I was applying for a job there! Any comment Marvin? Past reputation perhaps?

On the whole I would have to agree with FXScalper’s previous post. I have made similar comments in past posts myself.

I would suggest that it is unreasonable for the company to request that clients stay in a trade for a given period of time. Firstly this fact is not mentioned in the T&C of the Customer Agreement. Secondly, it is arguable that the company is breaching FSA regulations as it is offering trading advice which is clearly beyond its remit as an ‘execution only’ service. Clients are entitled to enter and leave positions at any time they wish so long as the relevant market is open.

I think also that the FSA’s Conduct of Business seems to imply that if a firm delays a clients order execution then the firm has to be able to show that the introduced delay is to the benefit of the client and not of benefit purely to the firm. Clearly the issue of dealer referral is an introduction of a delay in order execution?

Also, as FXScalper already mentioned, the basic business model would appear quite fragile with respect to profitability. With a 1 pip spread on a market which, in the real world, has a 3 pip spread leaves the company in a position where they are giving away value (even if it is very small) each time a client trades. This is clearly a risk as it potentially allows clients to trade methods on the firms system which the client couldn’t trade in the real world.
People also talk about the successful 10% who make money. That statistic is misleading in the fact that the successful 10% trade much higher lot sizes (or bets sizes) than the broadly unsuccessful 90% and thus the balance of net losing trades vs net winning trades is brought much closer to the 50/50 mark than the basic statistics suggests.

It would have been nice to have at least tried the Worldspreads platform but that now looks unlikely given my unsuccessful account application.

Steve.

 

[Directional]

This is perfectly logical to me. These guys were promising what they couldn't deliver. The idea that they are trying to eliminate lag scalpers by forcing people to stay in trades for 10 min is too funny.

agree. I didnt make my point very well in my previous post,, but I'm sure there is a reason for the sub 10 minute refer to dealer practice.

most likely they have analysed the distribution of winning trades and found that a large majority of winners fall into the under ten minutes time bracket. There will be an average number of points won on each winning trade, so by referring sub-ten minute trades to dealer, they can requote this category of trades and add the average number of points won to the re-quote as slippage to stifle the loss factor for the firm.

 

[qmpma1]

I would agree with you, only a small % of traders are winners, but you can be sure they are the ones placing the largest trades, certainly I was starting to increase my trade size. As has been said previously scalping was never going to work because they can't hedge the 1 point spread which they would need to do to ensure they didn't make a loss.

 

[gle101]

Well, yes I agree, it would be useful to have the right figure in percentage, money wise. I wouldn't be surprised if that figure still is around 85%, despite the fact that the winners are betting larger amounts. Anyone on the forum that has the right figure on this one?

 

[laptop1]

Nice to see I'm not on my own. I only use them for testing new methods these days with a stake of 1 pound a point. even with that small amount im on referred to dealer lol

I traded with them back in the summer, I only lasted 4 days before taken off Auto trading and on put on refereed to dealer.… I only made £1,400 off them, they told me I cannot be put back on instant execution dew to my style of trading.....My experience with them is well documented on the other Worldspreads thread. maybe I should start posting back on there as the new upgrade don't apply to me and some others on here what I can see.