You see 201.20 1101 on the ASK?
The 0001 is me.
My order is sitting on the ECN.
If someone comes along and places a market order when my offer is on the ASK or a limit order at 201.20, I will be filled.
THE SPREAD MAKES NO DIFFERENCE.
I will gross 6.1 pips.
When you understand how this works, you will start to make more pips.
OK Rumple, I talked to Kevin.
It was a misunderstanding of nomenclature. We were both seeing the same elephant from different angles.
Also I normally use market and stop orders so that’s how I was seeing what you were saying.
Here’s what I got out of my conversation with him;
RE: Bid/Ask
When you are talking about bid/ask, you are talking about the columns of the Market Depth Board, I was hearing market bid/ask that you would see on the price tickers. THAT was the biggest part of it right there.
When you place a market or stop order there can be slippage in a fast moving market.
When you place a limit order (Limit or Better) that means that is the limit of the price you wish to be filled at, but it could be a better price or it may not be filled at all. A sell limit would go into the ‘ASK’ column of the Market Depth Board - VERY IMPORTANT DIFFERENCE. I was hearing that your sell limit was being filled by “market” ask which of course didn’t make sense.
When your sell limit goes into the ask column, you are basically “getting in line to be filled”. As your order moves up the board you have a higher chance of being filled, if the opposite order that picks up your order happens to be better than your “ASKing” price, then you get a better price (which could turn out to be ‘market’ ask. Limit or Better.
I had said something about your order being filled at a better price than you put in for but wrongly called it ‘slippage’. I guess that word only works on market and stop orders and against you.
Again nomenclature (proper titles).
RE Spread;
What Kevin said is “Brokers who utilize ECN technology do not collect on the spread.”
He didn’t say there was NO spread or that it makes no difference. He just said THEY don’t collect on it.
MBT will only charge you the commission (true), but you as the trader will still pay the spread on exit - to the market. If I’m long and market Ask stays still but market bid moves, my floating P/L will change with it.
Now using a limit order can reduce that spread for you because of that better price that can be had, but the spread is still a factor.
Anyway, I now understand what you were trying to say.
MBT will only charge you the commission (true), but you as the trader will still pay the spread on exit - to the market. If I’m long and market Ask stays still but market bid moves, my floating P/L will change with it.
That’s still not accurate.
You do NOT pay the spread.
You are mixing apples with oranges.
Bear with me…
CLEAR YOUR MIND… YOU ARE NOT AWARE OF THE SPREAD.
If you buy at 1.0005 and sell at 1.0010, you gross 5 pips.
If the broker charges you the equivalent of 2 pips in commission, you net 3 pips.
Are you with me?
Now, let’s introduce SPREAD, BID/ASK.
1.0000 X 1.0005 YOU BUY
1.0005 X 1.0010 YOUR OFFER MAY FILL HERE AND YOU GROSS 5 PIPS
1.0010 X 1.0015 YOUR OFFER AT 1.0010 GETS FILLED AND YOU GROSS 5 PIPS.
Either way you gross 5 pips and you net 3 pips.
SPREAD DOESN’T MATTER.
0.9995 X 1.0005 YOU BUY
1.0000 X 1.0010 YOUR OFFER MAY FILL HERE AND YOU GROSS 5 PIPS
1.0010 X 1.0020 YOUR OFFER AT 1.0010 GETS FILLED AND YOU GROSS 5 PIPS.
DID SPREAD AFFECT YOUR GROSS OR NET PIPS?
It’s different at a FIXED SPREAD BROKER and it’s one of many reasons you should NEVER trade with ( against ) them.
Nope, I don’t get it.
Especially when I have an open trade and watch as P/L changes with bid/ask (depending on direction).
Please explain it another way.
Are you still talking limit orders and the possibility of being filled with the best possible price?
YES, LIMIT ORDERS… MARKET ORDERS ARE FOR SUCKERS who do NOT know any better or for when you PANIC and want out of your position no matter the cost.
Ok so what you’re saying is best possible case scenario. Which doesn’t happen everytime, it’s a possibility.
Yelling doesn’t get your point accross any better.
Best possible case? No. I am just talking about how the market works.
It’s an auction.
Think of it this way…
On the left side of the street there’s a bunch of people standing in line who will buy if you sell it to them at their price.
On the right side of the street there’s a bunch of people standing in line who will sell if you buy it from them at their price.
You can either get in line (LIMIT ORDER) or buy from the sellers or sell to the bidders(MARKET ORDER or LIMIT ORDER at market price or better).
I wasn’t yelling. 
It seems that typing in CAPITAL letters is associated with YELLING…not always the case…its just a way to focus on a particular word, sentence etc… such as is bolding, italicizing, underlining, coloring, etc…you know what they say about “ass-u-m(e)-ing” 
Yes, that’s fine. I already understood the mechanics of the order types with MBT, but you’ve helped me to see the benefits of limit orders.
Thanks.
I am going to do just that…starting with MBT
Please let them know TheRumpledOne referred you.
Thanks.
That’s what I try to do… get people to see the TRUTH!
When they know the TRUTH then they can make better decisions.
You are welcome. Hopefully, you’ll up my reputation.
What do you win as a referral ?
Ok, I downloaded it and fired’er up…so different! :eek:
I’m still going through it and the tutorials, but it would seem that they don’t have charts…at all …unless I haven’t found them yet? Do you just use free demo accounts for them?
Now, would I use the Limit + TTO order type which places a t/p & s/l? Once I get the hang of the software, I’ll try to place the same order at the same time in both to compare the commission vs spread costs.
Oh, I tried to indicate you as a referral, but TRO didn’t come up in the list, and neither did “other”, so I just picked one…Oh well, should I use them for real I’ll try again. Don’t suppose demo would win ya the cadillac …don’t you already have one anyways 
TheRumpledOne is on the list, you have to scroll down…LOL
Yes, no charts. I just use LIMIT orders. But you are right, you can use the TTOs.
Sorry but I could not help myself BUT to interject here!!!
I’ve been following this thread becuase I trade (amongst EVERYTHING else GBP/ZAR that has a spread of 500 pips)!!!
It would seem that only ONE person has actually even ‘touched’ on the answer to the original question!!!
Why trade currency pairs with VERY high (bordering on the EXTREME in the case of GBP/ZAR) spreads??? Because they can be VERY profitable IN THE EXTREME!!!
The spread is ‘relative’. By that I mean that GBP/ZAR will usually move in the 1000’s of pips every other day so a spread of 500 pips is ‘neither here nor there’.
Also: it’s (GBP/ZAR) one of a few pairs where the ‘payout’ is EXTREME. I mean: on a $200 lot it’s not impossible to make a profit of $2 000 every couple of days (assuming of course you know what your’e doing and you have a decent trading system). BEAR IN MIND that positions on this pair (these pairs) can ALSO go the OTHER WAY AS WELL!!! When trading pairs like this (these) money management is PARAMOUNT (well it’s PARAMOUNT ANYWAY but MORE SO with pairs like this / these).
As for trying to ‘scalp’ these pairs: I PERSONALLY don’t even see how it’s possible (but then I don’t ‘scalp’ so I cannot really comment I suppose).
This is another reason though why the number of pips that you make is NOT important. The $$$ value is what IS important NOT the number of pips!!! I mean: I could post that I MAKE 300 pips in a day. That would SURE capture everbody’s attention I’ll bet. BUT: if I was honest and QUALIFIED that statement by saying that I made those 300 pips in a day trading GBP/ZAR then THAT is a TOTALLY different ‘story’ i.e. I’ve not even covered the spread whereas 300 pips made in a day trading GBP/JPY is ‘another kettle of fish’ (in this example) altogether. So the NEXT time you see a post that starts something like ‘+300 pips per week guaranteed’ then just do yourself a favour and look SLIGHTLY further past your ‘greed’!!!
but greed is a human feature so you have to ask them not only to look further their greed bbut to try to trade with no emotions of any kind.
Hello,
Charting is currently available in the demo environment of the MBT Navigator. To access the charts please select Navigate > Tools > FX Chart.
Kind Regards,
Kevin Lam