Good morning, and thank you both for the trouble you went to with those replies - very insightful.
After reading your reply I think I need to maybe rethink my question or my logic or both as you are right (I think) - there are are too many banks in the world to have all of this on information on tap in realtime. However - that applies only to forex (once again - I think). Put it this way - I can understand that when I am buying or selling USD for example - there are hundreds if not thousands of banks that are either buying or selling USD at a certain rate and the brokers I would assume are going to the bank with the best rate (actually - I must tell you - that I read about a ‘system’ that the brokers ‘may’ use from time to time to make instant huge $$$ - they will find two banks where the price on the same instruments differs - and then buy HUGE volumes at bank one and then sell to bank two or visa versa. The reason this works is because their systems can be set up in such a way that this transaction would be executed instantaneously almost as if it were one single transaction. Obviously the amounts involved would have to be quite substantial to make a profit).
Anyway - once again - I digress (I have that kind of mind - too much going on at once and the worst part is that I tend to trade the same way)!
OK - when I am buying or selling forex then I am buying or selling (via my broker) forex from various different banks right (assuming of course that my bid or ask actually makes it out of the front door of the broker and that I am not just trading between the brokers clients - but - that’s another discussion)? But - if I am buying or selling DAX or S&P500 or FTSE100 - then surely I am buying or selling (eventually) from a single point e.g. Frankfurt Stock Exchange or NYSE? Somebody PLEASE check me on this. If I am right - then somewhere - there must be a realtime feed or something like that, at the exchange selling the index, of the amount of shorts and longs pending.
OK - I’m convinced - I will spend some time today going over the stuff you posted and check out leveragefx - thanks again for that.
As far as my paranoia is concerned - I have to disagree with you.
Put it this way - we have laws agains drunken driving (DUI in your country) BUT if I had one GBP for every person over the limit on a Friday night here in South Africa - I would not be trading forex for a living (I quote GBP because you get a lot of ZAR for 1 GBP - I’m the greedy type)! I know that I would make at least 4 GBP a month - from me! Joking around with you of course but I think you get the picture.
I honestly don’t think that it is my imagination though. It is something that I believe exists and as such I try and cover myself for it. I have accounts at three different brokers and I constantly compare price movements between the three to make sure that everything I’m seeing at one broker is consistent with the market. That might sound like paranoia BUT it does help sometimes. A good example: I bought a lot of Gold a while ago (still waiting for $700) at one of my brokers and on Friday night Gold started to turn and I then noticed that the Gold price differed by about $10 at one broker from the other two. I called the broker and it turns out that the feed was down (and had been down for most of the day). They reset the thing - problem sorted out - and what was a loss that I had been sitting on for two or three months instantly turned to a profit. Great feeling. Anyway - having said that - I had the DAX price displayed on two of the three platforms just before the payrolls data and on only one of them did a spike appear (obviously the one where I have a lot of DAX). As it turns out this particular broker nailed themselves. I was wrong about where the price was going to go and their spike made me about $1 800. Thanks. I have checked this out on other big time news events (I don’t trade the news by the way - learned that lesson the hard way several times) and this type of thing does happen for sure. On the other hand - it may pay to mention - and back up your theory about the laws in the US - that this particular broker is in Belize - close enough to the US to count - but far away enough to not fall under US law! (And don’t tell me to close this account - as long as you stay one step ahead of them - you’re alright)!
Anyway - I thank you for your replies - and I know that my questions are not strictly forex related - so I think - if it is OK with everyone here - I am going to see if I can start a poll - to see if there would be any merit in opening a thread dedicated to futures and the like - I mean - we are all one happy family right?