What slippage is normal? Stats on my 4621 trades

[hhiusa]

Listen up hhiusa,

IB are no better than anyone else. Hopefully you are aware of their downtime where you cannot do anything in this period.

And this is what can and does happen.

http://www.trade2win.com/boards/for...rokers-fx-horror-fill-1-26-slippage-stop.html

Wow! what a waste of a post. You guys love to post images of chart without any explanation and no they are no self explanatory.

IB are not better than anyone else you say? I know that IB is not necessarily the best. There you go again making unfounded assumptions.

My question is, why should someone choose a retail online broker over a direct access broker? Why should I choose a broker that only offers one financial asset class instead of a broker that offers everything?

Are you actually buying the currency or just speculating? If I buy 17,000 GBP/USD, I can either use those pounds towards buying equities in the UK or I can withdraw them into a GBP denominated bank accounts.

 

[counter_violent]

Wow! what a waste of a post. You guys love to post images of chart without any explanation and no they are no self explanatory.

IB are not better than anyone else you say? I know that IB is not necessarily the best. There you go again making unfounded assumptions.

My question is, why should someone choose a retail online broker over a direct access broker? Why should I choose a broker that only offers one financial asset class instead of a broker that offers everything?

Are you actually buying the currency or just speculating? If I buy 17,000 GBP/USD, I can either use those pounds towards buying equities in the UK or I can withdraw them into a GBP denominated bank accounts.

Read the thread link in my previous post, and the chart will make perfect sense.
It is all about IB downtime and slippage.

 

[hhiusa]

Read the thread link in my previous post, and the chart will make perfect sense.
It is all about IB downtime and slippage.

You do not read too well do you? I do not care that complaint thread. It is irrelevant to my question. Let's try this again!

My question is, why should someone choose a retail online broker over a direct access broker? Why should I choose a broker that only offers one financial asset class instead of a broker that offers everything?

Are you actually buying the currency or just speculating? If I buy 17,000 GBP/USD, I can either use those pounds towards buying equities in the UK or I can withdraw them into a GBP denominated bank accounts.

 

[Oscar Reed]

Trade size.
For example ASX (XJO) is $25 dollar a point with direct market.
Retail broker(market maker) you can trade $1 per point and even lower with some brokers.

Maybe some people only want to watch and trade one instrument.

 

[Jason Rogers]

Trade size.
For example ASX (XJO) is $25 dollar a point with direct market.
Retail broker(market maker) you can trade $1 per point and even lower with some brokers.

Hi Oscar,

You make a great point about trade size! :smart:

In fact, you can trade as a little as 10 cents per point on several index CFDs we offer. Furthermore, it's worth noting the pricing that's available to our retails clients compared to what's available in the futures or interbank markets.

As our CEO Drew Niv stated regarding the detailed execution study we released yesterday, "We wanted to explain why FXCM's liquidity providers provide better pricing on our retail trading platform for Retail Clients. Our liquidity providers are only allowed to be price makers for our retail clients and not price takers.

"Only our Retail Clients can take a price which protects the market maker from potentially being picked off by larger or faster predatory market takers, making them more comfortable and giving them the ability to make a market based on quality of price and liquidity rather than speed."

You can see this in the stats highlighted in my previous post:

Compared to the Futures Market:

FXCM was equal to or better* than the quoted futures price 90.83% of the time compared to the spot equivalent quoted futures price on the CME.

• Better than the futures price: 86.47%
• Equal to the futures price: 4.36%
• Worse than the futures price: 9.17%

Thus leading to a potential savings of $36,350,525 for FXCM LLC clients^.​

Compared to the Interbank Market:

FXCM was equal to or better* than the Interbank price 95.31% of the time.

• Better than the interbank price: 92.19%
• Equal to the interbank price: 3.12%
• Worse than the interbank price: 4.69%

Thus leading to a potential savings of $55,121,988 for FXCM LLC clients^.​

 

[hhiusa]

Hi Oscar,

You make a great point about trade size! :smart:

In fact, you can trade as a little as 10 cents per point on several index CFDs we offer. Furthermore, it's worth noting the pricing that's available to our retails clients compared to what's available in the futures or interbank markets.

As our CEO Drew Niv stated regarding the detailed execution study we released yesterday, "We wanted to explain why FXCM's liquidity providers provide better pricing on our retail trading platform for Retail Clients. Our liquidity providers are only allowed to be price makers for our retail clients and not price takers.

"Only our Retail Clients can take a price which protects the market maker from potentially being picked off by larger or faster predatory market takers, making them more comfortable and giving them the ability to make a market based on quality of price and liquidity rather than speed."

You can see this in the stats highlighted in my previous post:

Ignoring the pink elephant in the room.

My question is, why should someone choose a retail online broker over a direct access broker? Why should I choose a broker that only offers one financial asset class instead of a broker that offers everything?

Are you actually buying the currency or just speculating? If I buy 17,000 GBP/USD, I can either use those pounds towards buying equities in the UK or I can withdraw them into a GBP denominated bank accounts.

 

[MarkDragon]

The question is what is your LOT SIZE? Slippage depends mostly on lot size, if its big enough you'll get slippage with any broker for sure.
Open 2-3 more accounts with other brokers like Нotforex and FXCM and launch your software there with proportionally smaller lots and thus slippage.
A Way to go !

Have you made some comparison of slippage when trading on Нotforex and FXCM with other brokers?

 

[MarkDragon]

Can you run things just using limit orders? If you can then the only slippage you might experience would be positive.

Limit orders guarantee the price, but not the execution. So I can not always go using limit orders. That’s actually the reason why the slippage problem understanding arose.

 

[MarkDragon]

Great question! :smart:

Slippage occurs when the price you requested is no longer available. There are a couple of factors that are the most likely cause of slippage:

1. Liquidity: the quantity of an asset that is available for trading at a certain price. Liquidity can be exhausted by orders that arrive before yours in the queue resulting in your order getting filled at the next best price. This is especially true during times of low liquidity such as a news event, which is why slippage is more likely to occur at these times.
2. Latency: the time lag between when your order is placed and when it executes. Latency can sometimes be reduced by running your trading platform on a virtual private server (VPS) that is co-located with our servers.

In the meantime yesterday I’ve tried out the following combination: an FXCM standard account + TradeMUX trading platform. FXCM underlines a great pool of competing liquidity providers, TradeMUX talks about trades processing time of 100 nanoseconds.
So here are the stats:

Looks cool to me so far... 40,19% less round turn slippage - really cool...

I’ll collect more stats - let’s look at the figures during the week...

 

[Jason Rogers]

In the meantime yesterday I’ve tried out the following combination: an FXCM standard account + TradeMUX trading platform. FXCM underlines a great pool of competing liquidity providers, TradeMUX talks about trades processing time of 100 nanoseconds.
So here are the stats:

Looks cool to me so far... 40,19% less round turn slippage - really cool...

That's very cool indeed, Mark! Thanks for sharing this info. On a personal note, I'm glad to see your own trading results confirm the quality of FXCM's execution.

I'm curious though: you mention slippage without making a distinction between positive slippage and negative slippage. Does your data take that into account?

As I mentioned in my earlier post, with FXCM it's possible to receive positive slippage where your orders are filled at a better price than you requested: http://bit.ly/1KWaV8g

 

[interbanktrader]

Wrong assumptions

Your assumptions about slippage at IB or any other broker are wrong no mater how you define it.

If you consider it as any difference in price between what you wanted to hit and what you got then there is no way with direct market access or any other type of execution you won't experience some difference in price at some time whether positive or negative.

It can come from a variety of scenarios, such as the price updating before your order arrives or from someone else getting their order in before you or an LP rejecting a trading and you get filled at the next best rate. There is nothing wrong with any of these its just the market structure.

Also IB self clearing is not relevant in spot FX as the only people who can clear it are banks. IB has a PB for spot transactions like any other firm.

Ignoring the pink elephant in the room.

My question is, why should someone choose a retail online broker over a direct access broker? Why should I choose a broker that only offers one financial asset class instead of a broker that offers everything?

Are you actually buying the currency or just speculating? If I buy 17,000 GBP/USD, I can either use those pounds towards buying equities in the UK or I can withdraw them into a GBP denominated bank accounts.