But I never paid commission on any of my trades with Oanda, FxPro and Alpari and there spreads are much better than SB's.
The most important things to me are consistent spreads, fast execution and no re-quotes....ie. just a reliable platform and broker that you can trust.
Hi
All brokers either charge commission or have a slightly wider spread from the natural bid/ask they can get in the market. If they give you true direct prices, you pay a commission. If there is no commission, you pay a slightly wider than natural spread.
Those listed by you must have been making tiny margins on the spreads if they weren't charging commissions. Sounds fair enough... but...this is the thing which IMHO makes most brokers untrustworthy - you said you paid no commission with those listed brokers, and they had tiny spreads, so they must have been making "other" money one of two ways (maybe both): higher overnight financing charge (SLM's overnight charges are actually very fair) and, you guessed it, foul play (stop hunting and spiking etc).
Brokers are not charities, they are there to make money. If they're big enough, they're generally making enough to cover their business costs (legitimate!) from steady trading from a large client base. But smaller companies are known for foul play due to lack of clients, as otherwise they would go out of business (or they'd have to increase spreads/commissions a lot more which would be digging their grave).
So in the SB industry I guess it's been accepted that spreads are wider as there are no commissions and yes over time other "real" brokers have tightened their spreads whilst offering no commissions too... it's just companies going head to head for competition. SB companies have done the same but generally in select (major) markets, like 1point FTSE and even 1point Dow (loss making I'm sure) and 1pip EURUSD etc...
Anyway, so yeah maybe the tax free consideration is in there somewhere, but generally not I think. It's just that the SB industry is its own industry and traditionally it therefore doesn't have to keep up with the other types of brokers - no-one said they have to! They offer their service, other brokers offer their service and you make your choice.
Your comments on the reliability of SLM are very hepful, thanks for making the effort to help others.
And yes I agree, consistent spreads, fast execution and no re-quotes with no fancy whistles and bells is all I want too!!!!!!!!
TOC