Dealing Desk - Is this true?

[dennerle]

I've had a chat with a dealing desk broker and got to know this from the conversation

Broker: We are a dealing desk.

Me: does the dealing desk trade against customers?

Me: i've heard several rumours about dealing desk doing that

Me: such that they do not only earn from spread only

Broker: Dealing Desk firms do provide you constant liquidity all time instead of forwarding every order they receive to a bank.

Broker: This means that you get a better and faster execution.



Can anyone confirm this if it's true?

[phil838]

Originally Posted by dennerle

I've had a chat with a dealing desk broker and got to know this from the conversation

Broker: We are a dealing desk.

Me: does the dealing desk trade against customers?

Me: i've heard several rumours about dealing desk doing that

Me: such that they do not only earn from spread only

Broker: Dealing Desk firms do provide you constant liquidity all time instead of forwarding every order they receive to a bank.

Broker: This means that you get a better and faster execution.



Can anyone confirm this if it's true?

Yes, it's true. Most retail forex brokers operate this way. If you win they pay you out of their own pocket, and if you lose they keep the money.

It's really common, and in my opinion nothing to be concerned about as long as you are using a regulated broker.

[dennerle]

Originally Posted by phil838

Yes, it's true. Most retail forex brokers operate this way. If you win they pay you out of their own pocket, and if you lose they keep the money.

It's really common, and in my opinion nothing to be concerned about as long as you are using a regulated broker.

what are the chances of market makers trading against customers?

[mastergunner99]

Originally Posted by dennerle

what are the chances of market makers trading against customers?

Anything's possible. If you stick with a large and regulated broker, there should be no need to get paranoid about it.

[phil838]

Originally Posted by dennerle

what are the chances of market makers trading against customers?

I have no idea...

The important question here is "why does it matter?" Your broker trading against you has nothing to do with your success... I've never seen anyone produce any evidence of brokers manipulating trades.

That's just a forex urban legend.

[Steve C]

Originally Posted by phil838

Yes, it's true. Most retail forex brokers operate this way. If you win they pay you out of their own pocket, and if you lose they keep the money.

It's really common, and in my opinion nothing to be concerned about as long as you are using a regulated broker.

I would think that you are correct with you assumption, given that around 95% of people lose whilst trading i would have thought that your broker would be only too chuffed to accept your trade in the almost certain knowledge that you will lose!

If i were a broker i wouldn't hedge, would you?

[boyfx]

Hey guys,

From what i understand this is how it goes. Brokers know that a very large % of traders blow their accounts, they know what kind of traders loose their money, so if the way you trade falls under the category of what they believe to be a loosing trader, they trade against you! And why would'nt they, they know that they have the odds on their side, all they have to do is keep trading against who they believe will be a loosing trader and eventully they will profit, just like how casinos work they know that the %'s of each of their games are in their favour so all they have to do is open the doors and keep spinning the wheel, rolling the dice, and dealing the cards, and by the end of the day they will take profit.

I don't think brokers mess around with their charts, and if there were any brokers messing around they would be quickly found out.

Thats my 3 1/2 cents.

Boyfx
Boyfx