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  1. #1
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    Default honest broker

    Good evening Jason, HPY to you & colleagues. my question is very simple & only required only honesty. i have been trading with an Australian Firm recently & feel that my broker was trading against me. In demo & back testing my strategy work nearly 70% but after coming to live trading & turning my account in 50% profit on the first day. I felt every time my apply my strategy, the trade went against me. So i redraw the rest of my deposit & i am now looking for a real ECN broker who will not do the same. I felt cheated & learned a hard lesson from them.

    My question is that some kind of practise you also apply at FXCM. surely i expect your answered to be NO but is there any trader out reading this thread can answer for it.

  2. #2
    Jason Rogers's Avatar
    Jason Rogers is offline Verified Broker Support and Analyst for FXCM FX-Men Honorary Member
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    Quote Originally Posted by ericpayet View Post
    Good evening Jason, HPY to you & colleagues. my question is very simple & only required only honesty. i have been trading with an Australian Firm recently & feel that my broker was trading against me. In demo & back testing my strategy work nearly 70% but after coming to live trading & turning my account in 50% profit on the first day. I felt every time my apply my strategy, the trade went against me. So i redraw the rest of my deposit & i am now looking for a real ECN broker who will not do the same. I felt cheated & learned a hard lesson from them.

    My question is that some kind of practise you also apply at FXCM. surely i expect your answered to be NO but is there any trader out reading this thread can answer for it.
    Hi Eric,

    I want to address your concerns, so first I need to make sure I understand what happened.

    While I don't know what broker you were using and I won't speak for another company, it's important to consider how your demo account or back testing results could differ from real account results for legitimate reasons.

    Could you tell me a bit about the trades you placed that resulted in a 50% profit on your first day of live trading? In my experience, the correlation between your demo performance and your live performance will depend on the following factors:

    1. How realistic are the trade sizes you are using?

    The default FXCM demo settings give you a starting virtual balance of $50,000 but what amount are you looking to invest? Keep your trade sizes realistic to the capital you have to invest. As a general rule of thumb, try not to exceed 10:1 effective leverage. That means you should consider opening no more than 1k for every $100 in your account. Jake mentioned that you can open an FXCM account with as little as $2000. With that amount you could trade up to 20k or 20 micro lots and still stay within 10:1 leverage.


    2. What percentage of your equity did you risk on your demo trades?

    With virtual money it's easy to stay calm when you equity drops 20%, because no real money is at risk. With a live account, such losses are hard to stomach. Try not to risk more than 2% to 5% of your equity on any trade, and by that I mean 2% to 5% of the equity you plan to invest with real money. So if you plan to invest $2000, then try not to risk more than $20 to $50 on any one trade. Note that you can still place long term trades. For example, on a 1k micro lot trade, you're risking 10 cents per pip, so with $50, you could risk up to 500 pips.


    3. Does your demo trading strategy rely on perfect liquidity? (which does not exist in the real market)

    Investopedia defines liquidity as follows: The degree to which an asset or security can be bought or sold in the market without affecting the asset's price. Liquidity is characterized by a high level of trading activity. Assets that can be easily bought or sold are known as liquid assets.

    For example, EUR/USD is the most liquid financial instrument in the world, but even for that most liquid currency pair, the liquidity will drop during news events. If your demo strategy is longer term and doesn't place trades during news events, then your results on a live account with the same trades would likely be comparable.

    However, if your demo strategy relies on getting filled at the exact price you requested during news events, you may find that such a strategy will not perform as well in the real market. That's because no demo can replicate the liquidity or lack thereof during major news events. That means your real market orders could be more prone to slippage.

    Slippage is when your order is filled at a different price than you requested. The good news with FXCM is that slippage can be positive as well as negative. Positive slippage is when your order gets filled at a better price than you requested. Below are the stats from over 127 million live trades executed through FXCM between January 1, 2015 and March 31, 2016:

    • 78.71% of all orders had no slippage.
    • 12.77% of all orders received positive slippage.
    • 8.52% of all orders received negative slippage.
    • 50.2% of all limit and limit entry orders received positive slippage.
    • 39.9% of all stop and stop entry orders received negative slippage.

    Note that positive slippage is more likely to occur with limit (take profit) orders, while negative slippage is more likely to occur with stop orders. That's due to the momentum of price movement when those particular order types are triggered.

    It's also worth noting that for market orders, Trading Station has a feature called Market Range (and a similar feature for pending orders called Range Entry) that allows you to specify how much negative slippage you're willing to accept on an order if any. For example, if you set your Market Range to 3 then you market order will only be filled if the best available price in the market is within 3 pips of the price you clicked on. Otherwise, your market order gets cancelled. Note that this feature only limits you're negative slippage. You're still able to benefit from any positive slippage even if it's greater than 3 pips. The video below has more info on how you can use the Market Range feature.



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  3. #3
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    Good morning Jason, thank you for your reply. i must admit that my lots size was at 4 lots. In demo & live that was the way i started until i change to micro lot. but my problem was every time i trade bigger ( size 1 ) than micro lots my trade was going against me. It was not during news events & my pair was usd/jpy, cad/jpy all the majors. But my questions is it a practise you guys apply to trade against their clients?

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    Quote Originally Posted by ericpayet View Post
    Good morning Jason, thank you for your reply. i must admit that my lots size was at 4 lots. In demo & live that was the way i started until i change to micro lot. but my problem was every time i trade bigger ( size 1 ) than micro lots my trade was going against me. It was not during news events & my pair was usd/jpy, cad/jpy all the majors. But my questions is it a practise you guys apply to trade against their clients?
    I am new here ... and in fact this is my first post ... while I may be missing the point, I believe that you are asking if the broker trades against you for the purposes of increasing their commission. While I am new to this world, the Commission structure for FXMC actually circumvents what you are referring to.

    This video gets into what you are talking about at about eight minutes and thirty-five seconds in.

    you tube watch?v=r4XSa_Ddw24
    Last edited by JamesDin; 01-22-2017 at 04:12 AM. Reason: That, not the

  5. #5
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    Quote Originally Posted by JamesDin View Post
    I am new here ... and in fact this is my first post ... while I may be missing the point, I believe that you are asking if the broker trades against you for the purposes of increasing their commission. While I am new to this world, the Commission structure for FXMC actually circumvents what you are referring to.

    This video gets into what you are talking about at about eight minutes and thirty-five seconds in.

    you tube watch?v=r4XSa_Ddw24
    Welcome to the forum, James

    As you pointed out, competition between liquidity providers on the No Dealing Desk (NDD) forex execution we provide to all Standard accounts (5k minimum opening balance) and Active Trader accounts (25k minimum) ensures FXCM prices are market-driven and fair.


    It's worth noting that FXCM uses the same base price for DD execution on Mini accounts ($50 minimum) before adding the fixed spread markup as the base price we use for NDD execution on Standard accounts before adding the commission. That's a key reason you can have confidence trading with FXCM regardless of the account type you choose.
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  6. #6
    Jason Rogers's Avatar
    Jason Rogers is offline Verified Broker Support and Analyst for FXCM FX-Men Honorary Member
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    Quote Originally Posted by ericpayet View Post
    But my questions is it a practise you guys apply to trade against their clients?
    Hi Eric,

    It's still unclear what practice you mean. Are you saying you believe your current broker is manipulating the prices they quote to you so your trades are unprofitable? If so, please read my previous post to James where I explain how competition between our liquidity providers ensures FXCM prices are market-driven and fair.


    You are welcome to review FXCM's historical prices to see how they compare to your current broker.

    Is it possible you are not taking into account the spread and/or commission cost on your trades? Note that the larger your trade, the larger your transaction cost in dollar terms. For example, while a 0.5 pip spread may only be 50 cents on a micro lot, it will be $5 on a standard lot sized trade.
    Last edited by Jason Rogers; 01-23-2017 at 08:55 PM.
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  7. #7
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    Thank you James & Jason, i will do a little more research on my former broker & see what i can come up with. Thank you again for taking time & effort explaining me how do you guys work. To be fair FXCM was recommended to me but choose to go with another broker. for sure i will keep trying my system on your demo account & will open a live account again shortly.

    Kind Regards

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    Hi James, cant see been able to watch the you tube video you are recommended, is there any chance you can send me the link again

    Kind Regards

  9. #9
    Jason Rogers's Avatar
    Jason Rogers is offline Verified Broker Support and Analyst for FXCM FX-Men Honorary Member
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    Quote Originally Posted by ericpayet View Post
    Hi James, cant see been able to watch the you tube video you are recommended, is there any chance you can send me the link again

    Kind Regards
    Hi Eric,

    I believe this is the video to which James was referring.



    Please let me know if you have any additional questions about trading with FXCM. It may interest you to review the information on our website regarding trade execution stats.
    Last edited by Jason Rogers; 01-27-2017 at 06:05 PM.
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  10. #10
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    thank you Jason, i will get back to you regarding live account progress.

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