Thanks, adamco for your comment. Guess I’d better open an account with Tallinex ASAP. For years I’ve had to put up with money losing trade execution delays with other brokers during major reports (within 2 to 15 minutes after the release), especially with the monthly US nonfarm jobs release. I recently asked a Tallinex rep in a chat session when Tallinex would start making available trading the Dow Jones stock index. He basically said it might eventually become available. Hopefully the index will be introduced soon, which usually reacts quite dramatically to the nonfarm and interest rate reports. Not more than a two pip bid ask spread for the Dow index would be especially nice.
I was reading a thread at another forum and a guy there essentially said all brokers have huge spreads during big news events. He showed a screenshot of the spreads of 4 pairs before & after the most recent NFP Report (the 4 pairs were: eur/aud, gbp/aud, eur/nzd, gbp/nzd). In the “Before NFP” screenshot he showed the pairs having normal spreads. But, in the “After NFP” screenshot he showed the pairs having huge spreads (eur/aud = 26.6, gbp/aud = 21.1, eur/nzd = 28.1, gbp/nzd = [B]60.0[/B].
He then wrote, “Anyone who can 1) Stays in a trade through big news events and 2) Chooses to stick them out anyway with stops narrower than the madness we see during big news, deserves to lose their money.”
He never did mention the specific broker he was using. That is why I am not able to list their name.
My question: Does Tallinex and other brokers discussed here in this thread have big issues with huge spreads during news events? I noticed adamco (here in this thread) mentioned that he didn’t have any issues with Tallinex in regards to the amount of time it took to execute a trade during a recent big news event. BUT, what about the spread? Is the spread during news events with Tallinex (or the other trusted broker of FX Choice) SO crazy that I need to totally avoid news events - even though the vast majority of the time I use somewhat large stops of 50 & 60 pips?
If you exclude nightmare situations such as the SNB fiasco, there are only three possible reasons for regular execution delays if you can see price moving on the platform:
-
the broker is trading against you (or trying to match your trade request with the request of another client on their book)
-
the broker has a dealing desk in operation and is actively engineering your losses
-
the broker is trying to maintain some form of fixed/maximum spread and can’t find a counter-party in the market willing to trade within their required spread range (this would show up as “requotes” in the MT4 logs, so if that’s not happening then either point 1 or 2 would the cause)
As regards the Dow index, we might provide a price feed for it at some point in the future, but it would not be a symbol you could trade. The Dow is a securities product that requires regulation in St Vincent and the expulsion of our US resident clients, which is slightly counter-productive. 
This is a typical “newbie” question, so I’ll cover it again …
[B]Spreads come from the market, not from the broker.[/B]
When you trade with a genuinely ECN/STP/NDD broker, your orders go into the market and are executed on a “best fill” basis.
Now, for any order to be executed in the market, there must be a counter-party (banks, etc.) to the transaction but, especially during significant news events, counter-parties often sit on the side-lines and/or offer further-out prices.
This all results in wider spreads, and these wider spreads are reflected in your trading terminal (which basically shows the last Bid and Ask prices executed).
The sting in the tail here is that people normally extol the virtues of brokers offering low spreads during news events, and berate brokers where the spread widens. In reality, the situation should be reversed - brokers who don’t show widened spreads during news releases are most likely trading against you (because their narrow spreads don’t exist in the market) and/or fail to place your trades because they have no counter-parties to transact with.
Trading at NFP is very tricky. Spreads and slippage are the hugest that can be seen on comdolls.
The point is that everything is happen less than in 1 second. I mean it’s a one price Tick that driven by NFP release and it may reach 100-200 pips and more. Just check Tick chart by your broker to get a clue about that. After that price try to find it’s balance, bounce off, chart show gaps,etc.
Trying to trade at NFP (I mean entering before release) is a mere gambling as there are numerous factors impacting on US labor market which is impossible to predict with likelihood more than 50%.
I prefer to trade after NFP release on retracement on EUR/USD as Tickmill has quite stable liquidity on that pair during that time and slippage is minimal there (average is 10 pips). SL level is 0 there what is especially important for news trading (in case there is a SL distance in pips you may have your orders opened to long, thus get losses from sudden spike etc.)
Spend 300-400 bucks on NFP just to see how market behaves during that time. Demo won’t help there at all.
Excellent explanation.
Still not sure I fully understand why you, Tallinex, are not willing to offer Dow index trading to US traders, since Tradersway, Sensus Capital, FxChoice, and Profiforex for a long time have been able to offer it apparently with no adverse economic impact on them, although I do accept, according to you, that the cost to Tallinex would be too high. I recently asked Paxforex by email if they planned to offer Dow trading, and they said that yes, they are thinking of making it available. You might consider copycatting on your webpage Tradersway’s statement in tiny print at the very bottom of their webpage saying “… information on this website is not directed toward soliciting citizens or residents of the United States …” Maybe that would appease the regulators so that they would be willing to “look the other way” and let you offer Dow trading to your US customers. If tough regulation (I thought you said Tallinex was unregulated, and kind of proud of it, too) in the geographical area of St. Vincent is the only big obstacle, you also might consider just moving to where one of the 5 mentioned brokers above resides. Yes, I think that is what you should do, relocate, so that we can trade the often very profitable Dow index. Securities product, shmecurities product, some of those CFTC sucking regulators just don’t want Americans making extra money trading the Dow, it seems.
Just thought I’d mention…have you tried the FxChoice MT5 pro account? These stock index CFDs are different than the ones offered in their MT4 account. The DOW index has a 1 pip spread during NY session, and 1 pip spread on DAX during Europe, NY sessions, no commissions. Another thing I like is these CFDs have extended hours trading – DAX, CAC, FTSE, Dutch also trade during Asia session, and Swiss Market Index extends trading through NY session. Haven’t seen that anywhere else.
A traded instrument is deemed a securities product (or not) by the regulator in each jurisdiction.
In some jurisdictions, Forex pairs are considered securities products while, in other jurisdictions, they aren’t.
If a broker wishes to offer a securities product then they must apply to their local regulator for approval and, as a consequence, abide by the rules and requirements of that regulator (the most visible requirement usually being the termination of accounts held by US residents).
Regardless, in such circumstances, there is no option for “looking the other way”, or “small print” on a website that will appease a regulator - the only way of appeasing a regulator at that stage is the payment of a large fine.
Furthermore, since the DJIA is a security traded via a US-based central exchange, the only ways to offer such a product are:
- to be a member of that exchange
- to operate through a member of that exchange
- to be a market maker (trading against your clients)
With options 1 & 2 requiring some level of connection with the US regulators, that would require NFA rules to be enforced for all clients trading Forex pairs, suspension of credit card deposits and a whole load of other unpleasant changes.
Option 3 offers a potential workaround for some brokers, but not those who operate as ECN/STP/NDD.
No, I haven’t yet tried FxChoice’s pro account, Shatners Last Stand. Thanks for the information. According to the information Tallinex just provided (option 3) it looks like the first 4 brokers I mentioned, maybe even FxChoice, our trusted broker, really are trading against their customers, at least some of the time. H’mmmmm, that is disturbing.
Hello everyone,
Why am I seeing different candle openings, closings across these 4 brokers?
Today’s daily openings:
FXChoice: 1.08672
TradersWay: 1.08671
ATCBrokers: 1.08390
Tallinex: 1.08250
FXChoice and Tradersway are very close.
Tallinex is way out there.
ATC Brokers is actually the one’s data that matches the strategy that I want to use. I came close to going with ATC, BUT I discovered when opening a live account with them, my funds were actually being sent to FXCM and controlled by them. Having ANYTHING to do with FXCM is OUT OF THE QUESTION for me!!
Someone please explain why the differences above?
Also, someone please point me in the direction of a broker that displays it’s data like ATC and MT4 closes it’s daily candle at 5pm EST?
Thanks.
I’ve been trading with Trader’s Way now for a bit over a month. The stock indices are listed on the platform but I cannot trade them. They are greyed out, if I pull them up and try to execute an order it will not allow me to do so. I was wondering why, this kind of explains it, as I have no doubt Traders Way is DMA/ECN.
Seems that you have forgotten or simply chose not to mention another option. You can STP it to companies like FXCM or GAIN. In fact you will STP the trades but what will your LPs do is a completely different story. And the fact that you are misleading people and trying to get some advantages because of that is not making you any honour.
That’s a good question. I suspect they are not doing the fills for these CFDs in-house, but are sending orders to a third party liquidity provider. I would like to understand better the role of these third party liquidity providers. I see advertisements about SIRIX and X Open Hub. Those guys basically offer turn key solutions to retail forex brokers, including the front end trading platform and liquidity for various forex, equity and commodity instruments. Forex Broker, Inc uses SIRIX. But there must be many other liquidity providers out there. Boston Technologies is another one.
FxChoice has different stock index CFDs on their MT5 vs MT4 platforms – contract size, price movements, tick volumes are all different – leading me to believe they have contracted with different liquidity providers for each platform. Recently they added a bunch of agricultural commodity CFDs on their MT4 platform. They probably contracted with yet another liquidity provider for these.
So the question I have is when a broker sends an order to one of these liquidity providers, what do they do with it? Tallinex described how with an ECN broker our currency trades ultimately go out to the interbank market. But what about for CFDs? Is the liquidity provider also the market maker? I guess if the liquidity provider gets enough business from various brokers, he eventually starts to function as a pseudo exchange, matching orders from other clients if available. Maybe this is how LMAX started out? No idea. Sure wish we had LMAX instead of NADEX. LMAX posts real time market depth for all their instruments right on the home page – very cool.
Forex is not a centralised market so the candle prices reflected by individual brokers stem from the liquidity providers they work with, the first/last prices transacted with those LPs during a candle, and potentially some slight differences in server times as different brokers synchronise their trade servers with different internet time servers.
Where “honour” comes into a clear explanation of facts is quite beyond me, so please explain what’s misleading…
I quite correctly covered the approaches that could be used, so your “STP” comment changes nothing - in fact, you overlooked some important aspects.
To clarify…
-
If “Broker A” is going to STP through to “Broker B” then “Broker A” would need a live account at “Broker B”
-
If “Broker B” is offering securities products then “Broker B” would legally need to be a regulated brokerage
-
As a regulated brokerage, “Broker B” would have to determine why “Broker A” wanted to open a live account
-
Seeing that “Broker A” was an unregulated brokerage, the compliance team of “Broker B” would either restrict the account of “Broker A” to non-securities products, or simply refuse to open an account
Of course, the above assumes that “Broker A” is an up-front brokerage - there are always back-door ways to achieve such a goal, however, it would still mean that “Broker A” was offering securities products without being licensed to offer them.
How about we be respectful of one another and have a discussion without such a negative tone? It makes this thread better. I believe Paul from Tallinex goes out of his way to answer all of the questions he is presented and spends an enormous amount of time doing so.
Yo Tom,
Nice reply and good explanations from Tallinex, although I’m staying with FXChoice as my broker…
Jose
Hey Jose,
Nice to speak with you here. I don’t believe we spoke here after our little scuffle aside from on the phone and via email 
I hope you are doing well – eurusd, up up up.
I think I will try Tallinex in the coming months when I am not too busy with work =)
Anyone seeing a trend with their brokers losing deposit and withdrawal methods. Some are having trouble with credit cards, others with wire transfers? This is probably the next step the regulators are taking. Please just give us the freedom to trade like the rest of the free world.