Im not dissin meta trader I just dont get it. I recently opened a meta trader demo account with ODL and am happy with it but was expecting more.
I heard somewhere that you can set it up so that when your indicators are alined the way you specify it will alert you or enter a trade or sumin.
Im askin you guys here where I feel comftable so I dont have to phone ODL and ask stupid questions.
Thanks.
hobbit has it right. MT is good software and EA’s are a major plus. You need to write a script for your trading idea or modify an existing one. There are several members on this forum that can help you with that.
There is other comparable software available through different brokers. Most of them are very stable and offer the common indicators. One of the issues I’m finding is the data feeds. One or two providers supply most of the smaller FCM’s and IB’s. Spreads can be “customized” for each dealer. So much for price transparency. (I know, b****, b****, b****…) Anyone have thoughts on this?
Good luck with your trading…
???
Speads can be customised?
I think what he’s saying is your broker may get a price quote data feed of the REAL spread, then they can change this data feed to show their own in-house spread, which is likely wider than the interbank spread, so it doesn’t look like you are getting screwed over on their trading platform… hah!
OK. I keep beating this drum to inform everyone who will listen that I believe there is [U]insufficient regulation[/U] as regards price transparency and capacity disclosure from dealers or ecn’s in forex. (That’s a really long sentence.) Here is a letter written by the President of a dealer. They offer market access through an “ecn” format. Clearly he will be biased. Read between the lines. Think this through and ask your live broker a couple pointy little questions. If the answers seem unclear, you may want to check with a few other brokers. I believe that when more customers come to forex and more money is at stake, regulators will get serious about cleaning up this dark little corner of the retail financial world. Do not be discouraged if you run into one of the bad apples. Be careful out there. Jealously guard your capital!
This is a public release, so no secrets are being exposed here nor any copyright infringed. [U]I am not recommending this or any other dealer.[/U] I did highlight a few interesting statements. Enjoy! 
Hi everyone-
I realize that Justin LeBlang keeps everyone up to speed and answers a lot of questions on many of these boards, but I really wanted to comment personally on certain things based on recent events.
If you have been watching and reading the forums lately, obviously there have been some interesting things that have come out from the NFA relating to this industry. Some of it has been very public and you can follow the filings themselves. Other bits have been more �behind-the-scenes.� I�m not here to mention other platforms in particular. What I wanted to address today was how this impacts EFX and how it relates to how we already conduct ourselves on a daily basis.
We decided long ago that the industry was going to be forced to move away from the �deal desk� approach where platforms offered themselves as �commission-free� while making gobs of money controlling their prices, their customer executions, and their spreads. Too many people measure the �cost of trading� in this business as the spread. That simply isn�t the case. Any financial vehicle that is traded has a bid and ask, which represents the best buyer and best seller in the market. If they were at the same price, it would be a trade, and they would execute against each other. Therefore, there is always going to be a �spread� between those prices. That by itself is not necessarily a cost, and I think this is where the confusion comes in.
If the quotes are true based on the number of participants, if your orders are accurately reflected in the market, if no one is allowed to manipulate their prices around their customers exclusively, and if you are given the tools to show your orders to the market properly, then you have a true market. If not, you have a controlled market. When one platform has control over all of these aspects of the market, trading is actually very costly, and it isn�t just measured in the spread. It�s measured in how good your fills are compared to wherever the real market is and whether the platform wants to fill you at all.
Our feeling is that this industry is going to self-regulate and move away from the model of deal desks completely. We took that approach when developing our model. We direct your orders instantly and immediately into the pools of liquidity that are offered in the TDFX ECN. That includes banks, institutions, and other customers that you can buy and sell against, show your orders to, and compete with. For that, we charge a fee, and that fee is disclosed. It makes a lot more sense than using the words �commission-free� to get your account and then manipulating you out of your money. It should also be noted that any platform that calls itself �commission-free,� no matter what their spreads, is trading against your orders, which means that you are not interacting with the true market.
One thing that we hear from people about working with us is that our process of opening an account, starting an IB, or becoming a money manager with us is tougher than with other platforms. There is a reason for this. We do full background checks on our money managers that includes an FBI profile. We actually turn down business that other platforms would take without hesitation. There are issues in this industry that relate to money managers who open up accounts with deal desks, churn the accounts, and get paid hidden kickbacks in commissions from the platforms, with no intent of making money for the client unless it is by accident. It is our opinion that this sort of relationship will ultimately be �regulated-away,� and there were some signs of that in the last few weeks, something that has not been mentioned much on these boards. The NFA is starting to require that firms �supervise responsibly� their money managers and their relationships with those money managers.
Another request we have from people is that we should take Paypal as a form of payment for our accounts like some other platforms do. Here is the situation. We feel that regulation is getting stronger and stronger about what we call a �know your client� policy. This incorporates a lot about our supervisory responsibilities, including something as seemingly unrelated as the Patriot Act. It is our obligation under law to know that funds being deposited into a client account are indeed those client�s funds as much as we can. The issue with Paypal is that someone could open an account here and then use Paypal to send in funds from any source, inside or outside the country, clean funds or not. When funds come in from Paypal, there is nothing that says that those funds belong to the person whose name is on the account at our end. We feel that this violates the intent of the law and that coming regulation will toughen up on this. We have chosen to be ahead of the regulation here as well.
We also think that there will be regulatory steps that lower the max leverage that platforms can allow customers to trade at. Statistically, accounts at 400:1 leverage have virtually no chance of being successful.
Our goal at EFX is to provide the best technology available while making clear what the customer costs of using the software are. We also want to deal with people who are acting appropriately in the business, and at the level of managed funds and �introducing brokers,� we want to work with people that do not have criminal backgrounds. Therefore, some of the process of opening certain types of accounts with us and becoming a partner with us are supervised at a higher level of Compliance than most firms have operated at to date.
One final thought is on the handling of customer funds and net capital issues. I see many people discuss on boards the net capital of firms, and I think that it is a legitimate issue to a point. However, keep in mind that deal desks, by definition, are maintaining a high level of risk by taking the opposite side of customer orders. Since we don�t do that, our primary risk on a day-to-day basis is monitoring our customer accounts to make sure that they don�t get in a position where the accounts could be �underwater� on a spike in the market. We do this with a combination of software and human intervention.
People seem to want some guarantee that nothing in the world could happen that would jeopardize their account outside of their own trading activity. There is no such possible guarantee at any financial institution. Different types of accounts at various banks and brokerage may offer a certain amount of insurance, but if you have more than the covered amount in your account, there is always something �in theory� that could bring down the institution and wipe you out beyond that level. What we can tell you is that we handle things with the following safeguards:
- Clients funds are segregated from our operating funds.
- Funds are held here in the US with Wells Fargo Bank.
- MBTF has a Fraud Bond to protect against action by an employee to act in a fraudulent manner.
- We have software and dedicated personnel who monitor large positions in customer accounts to control potential problem trades.
Is there a potential world event that could so dramatically impact us that customer positions would place the firm under beyond our net capital and the value of the customer accounts in question? Again, �in theory,� there always is. We feel very strongly that we have protected ourselves and our clients as much as possible against such an event.
Sincerely,
Jon Floyd
President
EFX Group
From our friends at the NFA:
National Futures Association
Notice to Members I-07-19
April 16, 2007Effective Date of New Interpretive Notice Governing Electronic Trading Systems Used for Forex Transactions
NFA has received notice that the Commodity Futures Trading Commission has approved a new Interpretive Notice to NFA Compliance Rule 2-36(e) entitled “Supervision of the Use of Electronic Trading Systems.” The Interpretive Notice, which applies only to systems used for forex trading, was approved by the Commission on March 28 and will become effective July 1, 2007.
All of NFA’s active Forex Dealer Members (“FDMs”) use electronic trading platforms, but the reliability of those platforms and the records they generate vary widely. NFA’s existing Interpretive Notice to Compliance Rule 2-9 entitled “Supervision of the Use of Automated Order-Routing Systems” (“the AORS Interpretation”) provides guidance to NFA Members on how they can fulfill their supervisory responsibilities over the security, capacity, and credit and risk-management controls provided by electronic systems that route orders to an exchange, but it does not address retail forex systems.
The Board determined that similar guidance will help FDMs comply with their supervisory responsibilities under NFA Compliance Rule 2-36(e). Parts of the Notice also apply to Members who are subject to Compliance Rule 2-39.
The new Interpretive Notice is modeled after the AORS Interpretation, modified as necessary based on the differences between exchange-traded agency markets and off-exchange dealer markets. It also contains two additional sections relevant to forex systems.The section on security tracks the AORS Interpretation. The general standard states that Members who handle forex orders must adopt and enforce written procedures to protect the reliability and confidentiality of customer orders and account information, and the procedures must assign responsibility for overseeing the process to one or more individuals who understand how it works and who are capable of evaluating whether the process complies with the firm’s procedures. This section goes on to discuss user authentication, encryption, firewalls, user authorization, periodic testing, and administration.
As in the AORS Interpretation, the section on capacity sets a general standard that requires Members who handle forex orders to adopt and enforce written procedures to maintain adequate personnel and facilities for the timely and efficient delivery of customer orders and reporting of executions. The general standard also requires Members who operate trading platforms to adopt and enforce written procedures to maintain adequate personnel and facilities for the timely and efficient execution of customer orders. In addition, the procedures must be designed to handle customer complaints about order delivery, execution, and reporting and to handle those complaints in a timely manner.
The third section also comes from the AORS Interpretation and requires Members who handle forex orders to adopt and enforce written procedures reasonably designed to prevent customers from entering into trades that create undue financial risks for the Member or the Member’s other customers. Although this general standard is the same as in the AORS Interpretation, the discussion of account controls is not. Many FDM trading platforms automatically liquidate positions before an account goes into a deficit, and some FDMs use this as a selling point for their platforms. Therefore, the Interpretive Notice requires firms that use this function to set the automatic liquidation levels high enough so that positions will be closed out at prices that will prevent the account from going into a deficit position under all but the most extraordinary market conditions.
The added section on recordkeeping spells out the information the system must record and maintain. As a general standard, it states that Members who handle forex orders must adopt and enforce written procedures reasonably designed to record and maintain essential information regarding customer orders and account activity. It then addresses the specific information that the electronic system should record and maintain in three categories:
Transaction records for orders (which must include the types of information contained on orders for exchange-traded commodities) and rollovers;
Account records showing the financial status of each account; and
Time and price records similar to those maintained by the futures exchanges.
The section on trade integrity sets a general standard requiring FDMs to adopt and enforce written procedures reasonably designed to ensure the integrity of trades placed on their trading platforms. It then discusses three specific areas of concern: pricing, slippage, and rollovers.
Pricing. Trading platforms must be designed to provide bids and offers that are reasonably related to current market prices and conditions.
Slippage. Electronic trading platforms should be designed to ensure that any slippage is based on real market conditions. Furthermore, if an FDM advertises “no slippage,” the platform should be designed to execute a market order at the price displayed when the order is entered and to execute a stop order at the stop price.1
Rollovers. The platform should be designed to ensure that automatic rollovers comply with the terms disclosed in the customer agreement.
Finally, the Interpretive Notice requires a principal of the Member to certify that the firm has met the relevant standards in the Notice. This principal must be a registered AP.NFA’s November 21, 2006 submission letter to the CFTC includes a copy of the Notice. ALL FOREX DEALER MEMBERS AND ALL MEMBERS SUBJECT TO COMPLIANCE RULE 2-39 SHOULD READ THE ENTIRE NOTICE. You can access an electronic copy of the submission letter at National Futures Association | News Center.
Questions concerning these requirements should be directed to Sharon Pendleton, Director, Compliance, at <[email protected]> or (312) 658-6540, or to John Brodersen, Associate Director, Compliance, at <[email protected]> or (312) 781-2226.
1 FDMs may not advertise “no slippage” unless they also meet the requirements described in the Interpretive Notice on Forex Transactions (NFA Manual, Para. 9053).