- Where do brokers get their live tick data? Is it from a single location or from some sort of network of banks sharing a live data stream…or what? Can live tick data differ - and if so, why?
2.Why does historical tick differ between brokers? For what reason is there not 1 TRUE tick history all the way back to the beginning of the market?
I do not see how this is possible at all and this makes me think that I am misunderstanding something fundamental.
- Who does the money from a spread go? I understand that the brokers get it; but do they keep it all, or does a part of the spread go to someone else? Who is that someone else; banks? Does a part of it go to the makers of Forex?
A good place start would be to google “The Structure of Forex Brokers” which will result in a series of posts by DarkStar at a fellow forum.
In a nutshell, the tick data comes from both a mix of institutions or sometimes just 1 bank. The FX market is a complicated place and order routing an even more complex field.
The FX market place is totally de-centralised and all entities that provide quotes do so independently of each other with only efficient market hypothesis to keep it together.
Think of it as 2 seperate motor vehicle auctions…both can auction the same car but you will probably be see different prices at the different auction houses, even though they are the same car and carry the same intrinsic value based on some form of book value. That is just the nature of the market…you buy or sell at the best price available to you at that time.