I faced a question from some people that I am losing in Forex and as I am losing, someone must gain. Then, who is this gainer?
The broker gets the money which you lose, plus the spread, and they use this to pay their clients who win. Of course, the broker’s gains are greater than their clients’ winnings, otherwise they would close the doors of their business.
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Your broker gains when you lose. They’re your counterpart, they take the opposite side of your trades.
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I do not agree with this statement.
as far as I know thing you are mentioning are market makers.
Brokers typically do not take the opposite sides for your trades. Brokers are intermediaries that facilitate trades between buyer and seller in financial market .
Brokers earn money through various means, such as transaction fees, spreads, and commissions.
market makers are entities that may take the opposite side of your trade. Market makers provide liquidity by standing ready to buy or sell securities at publicly quoted prices.
B book brokers are usually market makers that sis why its important to chooses a broker carefully
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Very, very few spot forex brokers aren’t counterparties.
And you can’t tell which are, anyway.
Most people are fooled by the language they use, claiming to be “ECN” or “NDD” or “STP”.
It’s all nonsense.
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maybe you have bought into the industry myth, Aisha? what you’re saying there is totally mistaken, regarding spot forex “brokers”
that is entirely true, but forex “brokers” are NOT brokers at all, in that (or in any other honest or reasonable or non-misleading) sense of the word
it’s absolutely astonishing that they’re legally allowed to call themselves “brokers” and advertise as “brokers” when they’re simply not
you are far from alone! it’s a hugely misleading situation which has (at least) thousands of people fooled
this is all explained in the Babypips School of Pipsology 
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That’s what I thought. Their money comes from commission, spreads, fees, etc. If my broker wins from my losses, that would mean they lose from my wins. I think they’re impartial, no?
They don’t really care if you win or lose. They just want you to trade, and keep trading, so you pay them the spread.
The forex contracts are constantly rotating between the clients. If I win, I’m taking from another client.
Right?
I think it was Tom Hougaard who said that brokers are offering every tool and information possible to help clients win and keep trading.
I guess I gotta go back to school, huh?
no
i wouldn’t bother
this post tells you what you need (i hope!!) -
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Well, you’re right. But in the real sense of it, the brokers we call brokers ain’t brokers at all.
Nice rhymes, yeah.
There’s not need explaining, @flamingoproxy and @Pipsteroid already did justice to that.
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The broker you are trading with gets the money and pay it to the profit maker.
Other traders that their Analysis show them to choose opposite of what you choosed
Hello folks, the topic of how forex brokers work, including how they make money, is covered in our Forex Brokers 101 section in the School of Pipsology.
Retail forex brokers aren’t technically “brokers” but “dealers.”
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In Forex, your losses aren’t directly someone else’s gain. Price movements involve various participants, each with their own strategies and outcomes.
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This is true enough.
Actually here in the UK betting through bookmakers is entirely legal. You can find a bookmaker’s “shop” on every high street in the country. It’s well regulated and as honest as any other business.
They are honest enough that even if they offer financial bets they do not call themselves brokers. Because they are not helping us buy or sell anything.
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When you lose in Forex, the gainers can be other retail traders, institutional traders like banks and hedge funds, or market makers and brokers who profit from spreads and commissions.
To me it looks like you are getting two schools of thoughts about who profits from your loosing trades.
Personally my opinion is you don’t need to be concerned about who profits from your loosing trades or even if anyone profits from your loosing trades.
As for my understanding on a broker’s business the way they profit is through charging commission and or altering the raw spread. If the broker chooses to help assist with liquidity for your trade the risk free way they would do it is to take an each way bet by hedging.
My personal opinion is that your broker just facilitates your connection to the web of the spot market.
But ultimately you don’t really need to worry about who (if anyone) profits from your loosing trades.
Obviously other traders win, maybe it’s retail traders, or maybe big traders who win in the liquidity pool. When we open a buy say 1 lot, there must be another party who sells 1 lot so that the transaction can be executed. Because forex trading is done through electronic transactions, we do not know who we are buying or selling a currency pair with.
im pretty sure some one else does, it being a broker playing middle man, or they trading them selves, another trader or even other corporations, thats how it goes.
Although sometimes they refer to themselves as “Turf Accountants”.
True enough.
It’s a great name isn’t it.