Dealing desk brokers -avoid them!

oildaytrader · Oct 7, 2009

Hi

Avoid dealing desk brokers .Orders placed with dealing desk brokers are routed to via dealing desks.This additional routing time delays order fills and may result in orders not being filled at all .In fast moving markets the dealing desk will simply ignore your order, cause everytime your order is placed the price will be moving , therefore your orders won't be filled.Your order is being ignored ,in fast moving markets, by dealing desk.If you are lucky to get a fill , it will be at a bad price.

If trader does not get a fill on winning trades, the dealing desk maybe placing its own trades in the market , the trader's profitable trades cease to exist.Trader may only be filled on losing trades . and this hugely impact trader's profitability.These dealing desk brokers will cost you more than the fictitious fixed spread they offer.They will cost you your profits.

Metatrader dealing desk brokers use instant execution(it is only instant by name ,but delayed or non fill execution in reality).According to the Metatrader user guide , the broker can ignore your orders.Quote from dealer guide "if the broker accepts the price ,the order will be executed".

Many brokers like Alpari claim STP execution , but their platform still has instant execution used by dealing desks.

I ran expert advisors on demo and live accounts simultaneously at ALPARI u k.The results were many non order fills .The metatrader live account log files are missing on the platform.

I will now move to S T P (Straight through processing) with ODL securities. Alpari do not offer STP at time of writing this post.At least I can only see instant execution on their platform .

None of the brokers admit publicly to using the VIRTUAL DEALER PLUGIN, as this admission would be bad publicity.The dealing desks do require some sort of a dealer software( to hold orders whilst getting hedged in the interbank market .

http://www.trade2win.com/boards/metatrader/74696-metatrader-bucket-shops.html

http://www.trade2win.com/boards/metatrader/74910-metatrader-backtests-flawed.html

OILDAYTRADER

tomo1 · Oct 7, 2009

Do you mean market makers?

oildaytrader said:
Hi

Avoid dealing desk brokers .Orders placed with dealing desk brokers are routed to via dealing desks.This additional routing time delays order fills and may result in orders not being filled at all .In fast moving markets the dealing desk will simply ignore your order, cause everytime your order is placed the price will be moving , therefore your orders won't be filled.Your order is being ignored ,in fast moving markets, by dealing desk.If you are lucky to get a fill , it will be at a bad price.

If trader does not get a fill on winning trades, the dealing desk maybe placing its own trades in the market , the trader's profitable trades cease to exist.Trader may only be filled on losing trades . and this hugely impact trader's profitability.These dealing desk brokers will cost you more than the fictitious fixed spread they offer.They will cost you your profits.

Metatrader dealing desk brokers use instant execution(it is only instant by name ,but delayed or non fill execution in reality).According to the Metatrader user guide , the broker can ignore your orders.Quote from dealer guide "if the broker accepts the price ,the order will be executed".

Many brokers like Alpari claim STP execution , but their platform still has instant execution used by dealing desks.

I ran expert advisors on demo and live accounts simultaneously at ALPARI u k.The results were many non order fills .The metatrader live account log files are missing on the platform.

I will now move to S T P (Straight through processing) with ODL securities. Alpari do not offer STP at time of writing this post.At least I can only see instant execution on their platform .

None of the brokers admit publicly to using the VIRTUAL DEALER PLUGIN, as this admission would be bad publicity.The dealing desks do require some sort of a dealer software( to hold orders whilst getting hedged in the interbank market .

http://www.trade2win.com/boards/metatrader/74696-metatrader-bucket-shops.html

http://www.trade2win.com/boards/metatrader/74910-metatrader-backtests-flawed.html

OILDAYTRADER

oildaytrader · Oct 7, 2009

tomo1 said:
Do you mean market makers?

No I do not mean market makers.In Forex there are no market makers.Nobody has the capacity to be marketmakers and hold positions in currencies .The market is worth trillions of dollars.

Dealing desk brokers do not allow you to place orders directly in the market.Your order is placed via the dealing desk in the brokerage, it is approved by dealing desk then hedged by dealing desk with a bank.The dealing desk is operated by bonus freaks ,the bonus freaks get a commission for screwing you for extra spread.

The dealing desk can be fully automated using a virtual dealer plugin(an automated software designed to screw traders with extra spread on market orders ,false slippage ,stop triggering,gaps to fill your orders at unfavourable orices ) or it can be manual dealing desk operated by staff.

If they have a dealing desk to accept or reject your order , avoid these bucketshops.

In straight through processing S T P , your order goes directly into the market and there is no dealing desk delaying your fills.The whole order processsing is fully automated.

http://www.trade2win.com/boards/forex-discussion/21967-alpari-uk-announcement.html

OILDAYTRADER

oildaytrader · Oct 8, 2009

tomo1 said:
Do you mean market makers?

Some people refer Dealing desk brokers as market makers , in forex market makers do not exist after the Refco losses and fiasco.

A Guide to Forex Brokers explaining what a dealing desk, non dealing desk, market maker, ECN and STP brokers are | Forex Magnates

Gain capital lost millions last year .Does anyone know why they lost millions?

http://www.tradingmarkets.com/.site/news/IPO INFO/2504792/

How to differentiate stp vs dd

STP execution orders do not allow stops and take profit targets to be sent with initial order.Stops and take profit are subsequently added ,after the entry price is known.

Dealing desk brokers will allow entry,stop loss and take profit to be sent with initial order.

oildaytrader · Oct 10, 2009

If you want to make money in forex, avoid dealing desk brokers.Dealing desk either manual or automated will play dirty tricks with your orders.

In forex most professionals trade in milliseconds,brokers with 15 or 5 second delays are bucketshops.The delay time is because the dealing desk is looking for opportunities to screw you.

Have a look at the chart below of minute candles .See Price moves as much as 12 to 20 pips in 1 minute .A few seconds is all the dealing desk needs to screw you with worse fills than the market price .

Market price vs market order dirty tricks.
The dealing desk benefits by looking for fills in fast moving markets by delaying your order fill.If dealing desk gets filled in interbank market,dealer responds with order fill
15 seconds later,the customer gets filled 5 pips away.15 seconds is all the dealing desk needs to trade against clients.

Limit order dirty tricks
Dealing desk will fill buy limit orders after offer price has moved several pips (sometimes as many as 10 pips) below your limit order, and for sell lmit orders fills are given when bid prices are several pips above limit sell order.

The dealing desks are often delaying order fills and looking for liquidity on their own platforms and assessing their own liquidity.This is for their own benefit of avoiding paying spreads in the interbank market.It is of no benefit to trader.

This knowledge I am sharing on this forum will help many avoid unscrupulous bucket shops forex brokers.It will take many traders many months to find out the true colours of their brokers.

Not a lot has changed with bucket shops.It is done differently.

Bucket Shops in Forex @ Forex Factory

http://www.trade2win.com/boards/metatrader/74910-metatrader-backtests-flawed.html

Proof that Forex brokers cheat you | Alan's Forex Blog

http://alansforexblog.com/wp-content/uploads/2008/04/dealer.PNG

OILDAYTRADER

neil · Oct 10, 2009

oildaytrader said:
If you want to make money in forex, avoid dealing desk brokers.Dealing desk either manual or automated will play dirty tricks with your orders.

In forex most professionals trade in milliseconds,brokers with 15 or 5 second delays are bucketshops.The delay time is because the dealing desk is looking for opportunities to screw you.

Have a look at the chart below of minute candles .See Price moves as much as 12 to 20 pips in 1 minute .A few seconds is all the dealing desk needs to screw you with worse fills than the market price .

Market price vs market order dirty tricks.
The dealing desk benefits by looking for fills in fast moving markets by delaying your order fill.If dealing desk gets filled in interbank market,dealer responds with order fill
15 seconds later,the customer gets filled 5 pips away.15 seconds is all the dealing desk needs to trade against clients.

Limit order dirty tricks
Dealing desk will fill buy limit orders after offer price has moved several pips (sometimes as many as 10 pips) below your limit order, and for sell lmit orders fills are given when bid prices are several pips above limit sell order.

The dealing desks are often delaying order fills and looking for liquidity on their own platforms and assessing their own liquidity.This is for their own benefit of avoiding paying spreads in the interbank market.It is of no benefit to trader.

This knowledge I am sharing on this forum will help many avoid unscrupulous bucket shops forex brokers.It will take many traders many months to find out the true colours of their brokers.

Not a lot has changed with bucket shops.It is done differently.

Bucket Shops in Forex @ Forex Factory

http://www.trade2win.com/boards/metatrader/74910-metatrader-backtests-flawed.html

Proof that Forex brokers cheat you | Alan's Forex Blog

http://alansforexblog.com/wp-content/uploads/2008/04/dealer.PNG

OILDAYTRADER

Whats your solution then Oily?

Trader1UK · Oct 10, 2009

Thankyou OilDayTrader... Very Very informative. I read about the dealer-plugin for MT4 about 2 years ago and was horrified, Id never open an account with a broker who has a dealing desk.

oildaytrader · Oct 10, 2009

neil said:
Whats your solution then Oily?

There is no solution, just avoid them.Let them advertise on forums and the internet , but not in our interest to give them our cash .We are not the police and we can not stop them.

We can give our business to the honest brokers and let them thrive.We can recommend more customers to the honest brokers.

My broker is expected to earn $200 per day or $50,000 per year from each successful trader like me.In the not too distant future,there will be at least 10,000 successful forex traders earning their brokers around $500,000,000 a year in commissions,.The dishonest bucket shops will be the losers and the honest ones will be the winners .

Traders have nothing against brokers, except a requirement for a good brokerage service.

Oildaytrader

neil · Oct 10, 2009

oildaytrader said:
There is no solution, just avoid them.Let them advertise on forums and the internet , but not in our interest to give them our cash .We are not the police and we can not stop them.

We can give our business to the honest brokers and let them thrive.We can recommend more customers to the honest brokers.

My broker is expected to earn $200 per day or $50,000 per year from each successful trader like me.In the not too distant future,there will be at least 10,000 successful forex traders earning their brokers around $500,000,000 a year in commissions,.The dishonest bucket shops will be the losers and the honest ones will be the winners .

Traders have nothing against brokers, except a requirement for a good brokerage service.

Oildaytrader

Brokers like Interactive Brokers for forex or would you think Currency Futures are the more reliable route, via CME?

oildaytrader · Oct 10, 2009

Si55AMG said:
Thankyou OilDayTrader... Very Very informative. I read about the dealer-plugin for MT4 about 2 years ago and was horrified, Id never open an account with a broker who has a dealing desk.

Many of these dealing desk brokers are advertising vacancies for dealing desk staff.You could be earning million of $ in bonuses.I won't single out the broker.

Every time the client places an order, if the fill is against the spread hit client with slippage, if the fill is below the spread the broker pockets the gain and shares with bonus freak (not with client), kinda high frequency front run.

oildaytrader · Oct 10, 2009

neil said:
Brokers like Interactive Brokers for forex or would you think Currency Futures are the more reliable route, via CME?

Interactive sounds good in theory, but I did notice offer price touch my limit order and waited and waited for a fill which never came.

A broker like UBS , Deutsche bank or barclays is more likely to be the solution.2 pips on euro /usd max or as little as 1.3 pips on dbfx for euro /usd .

I am going to stop trading cable because of liquidity issues of non fills and just trade euro /usd .Euro usd is the smoother trender and a more reliable trender.Cable jumps all over the place due to liquidity shortage- and is very unpredictable.

1.3 pips on euro usd at DBFX is equivalent to 0.5 pips spread .There is 20 times more liquidity and executable price changes per minute on dbfx.You have 10 times more chances of getting a fill.C M E is no comparison to interbank market.What C ME does in a whole day , interbank does in an hour.Plus point: Your money is safe with Deutsche bank and guaranteed by Association of German Banks

http://www.trade2win.com/boards/forex-brokers/44854-dbfx-market-maker-ecn-7.html

I use ODL and get instant execution nowadays , with low spreads.Things are changing.I use metatrader expert advisors but am going to write an API with DBFX.

OILDAYTRADER

Trader1UK · Oct 10, 2009

Ive heard some C*** reviews about DXFX and their little games..
Any comments on that?

oildaytrader · Oct 10, 2009

Si55AMG said:
Ive heard some C*** reviews about DXFX and their little games..
Any comments on that?

SI55amg

I personally do not believe the posts and reviews about DBFX are written by anybody other than the bucketshop competitors.The bucket shops fear DBFX's success is the nail in the coffin for bucketshops, DBFX retail arm of Deutsche bank is where these bucketshops get liquidity.These reviews are on blogs paid for by bucketshops , or some dingbat bloggers.The bucketshops gain by tarnishing DBFX reputation.

The reviews you read are not credible.

I do not have an account and have not traded with them.I have been in contact with them and have a good impression of them..I get several emails promoting dbfx every week.Nothing wrong with them marketing, their competitors are worse in terms of illegal marketing tactics like paying bloggers to discredit bad reviews on competitors.

Trader1UK · Oct 10, 2009

oildaytrader said:
SI55amg

I personally do not believe the posts and reviews about DBFX are written by anybody other than the bucketshop competitors.The bucket shops fear DBFX's success is the nail in the coffin for bucketshops, DBFX retail arm of Deutsche bank is where these bucketshops get liquidity.These reviews are on blogs paid for by bucketshops , or some dingbat bloggers.The bucketshops gain by tarnishing DBFX reputation.

The reviews you read are not credible.

I do not have an account and have not traded with them.I have been in contact with them and have a good impression of them..I get several emails promoting dbfx every week.Nothing wrong with them marketing, their competitors are worse in terms of illegal marketing tactics like paying bloggers to discredit bad reviews on competitors.

Yes i can vouch for that,, I guess giving them a try is the only way to find out. Ill do more research into them and see how it goes. Looking at Dukascopy too, probably give them a try too in the near future.

Thanks Oildaytrader

sakhter · Oct 10, 2009

If you are a good trader it does not matter where you trade. All MT4|5 brokers are in the same bed together. Unless your 1:1 leverage, all these buckets can see your order and act accordingly.

They have to send your order via STP if your buying a standard lot with $100K.
They get to play games when your buying a standard lot with 200:1 leverage and beyond.

Just how the game is played.

oildaytrader · Oct 15, 2009

Metatrader Expert advisors fail sometimes due to dealing desk brokers server side capabilities to tamper with expert advisor performance.Consistent requotes will automatically disable the expert advisor from placing orders,spread widening will automatically disable the expert .

Corrupted price feeds hunting for stops will result in total failure of expert advisor on live account.Unfortunately traders are dealing with modern day bucketshops, these bucket shops are trading against client's cash .

Execution delays cause expert advisors to fail.

http://www.trade2win.com/boards/forex-brokers/75962-s-t-p-brokers-equal-ecns-retail-traders.html

GammaJammer · Oct 15, 2009

oildaytrader said:
Execution delays cause expert advisors to fail.

'Expert advisors' Fail. Period.

oildaytrader · Oct 15, 2009

GammaJammer said:
'Expert advisors' Fail. Period.

They work fine for me.A great expert advisor will remain profitable over the longer term,it will go through periods of losses and losing months.The secret is to make them survive in difficult market conditions and perform in dynamic market conditions.

99% of expert advisors you have seen are made for specific market conditions.They fail because markets are dynamic, and when market conditions change the expert fails.

All one requires is excellent execution and broker for my expert to work.It is one expert advisor made up from 11 different market conditions/systems/experts.I would never sell it,show it to anybody or license it.

Just look at the loosing periods and the overall winning performance.

The world's greatest trader, James symons of rennaisance technologies, use computerised models to trade.He is the world's greatest trader and beats Sorros and the lot for consistent performance.

Renaissance Technologies - Wikipedia, the free encyclopedia

O D T

AmateurTradersOnline · Oct 15, 2009

Great thread, Some really good info. I've found that dealing desks especially during big news releases are a nightmare as your order gets stuck in the market and you cant cancel it.

oildaytrader · Oct 15, 2009

AmateurTradersOnline said:
Great thread, Some really good info. I've found that dealing desks especially during big news releases are a nightmare as your order gets stuck in the market and you cant cancel it.

This happens because you have a dealing desk trying to catch a price against your order price.The dealing desk is trying to catch a fast moving price and chasing it.

With good true STP set up you can get out.

Some brokers make false claims to be STP brokers.Just beware.

ODT

Dealing desk brokers -avoid them!

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