I’ve got two practice accounts, one with Alpari, the other with FXCM. Right now it’s Saturday and so the markets are closed. In the chart in Metatrader 4 (the Alpari software), it’s showing that EUR/USD closed at 1.31390. However, FXCM’s Trading Station shows it as having closed at 1.31405. Why the difference?
Because they are different FX dealers, therefore, their data feeds are slightly different a bit.
never is correct. spot forex is not traded on a central exchange with a best bid and offer. therefore any market maker or dealer can set their own price, spread and fees. if you would like something more transparent i would highly suggest moving to futures.
Holden, hello.
The two previous replies are correct, but allow me to expand on this subject. Each broker/dealer has a HUB, within this HUB you have broker/dealer liquidity, retail trader liquidity, and prime broker liquidity. For most retail accounts you will never transact against a Prime Broker, meaning Banks etc. The average retail trader transacts against broker/dealer and other retail trader liquidity. Now the way the HUB works is that the data feeds from the broker/dealer, retail trader, Prime Broker, Bloomie, Reuters, etc. get homogenized and appear to the retail trader as one quote stream, and even though the retail trader sees this quote stream, they are actually on a segregated HUB, a HUB within a HUB if you will, and cannot execute against the Prime Broker. As an aside; to have the Prime Broker liquidity added to your HUB most brokers require a minimum monthly unit quantity, account and trade size, also, in general the straight up retail platforms have liquidity to 5 mio, and if you need more, you need fulfill the requirements.
So this is why you can see differences in quotes between broker dealers. Again as said before, there is no central exchange, so if some retail trader is “averaging a loser” and shorting 4 times as the price moves against them to try to make up for a bad trade, this might only be seen on the retail hub and not sent out to other quote providers, so on this HUB the price may rise 20-30 pips while it stays within a few pips consolidating on another HUB.
And this is also why you find soo many hypothetical Gurus in Spot Currency, if someone notices a difference in entry price or an impossible trade size at the moment of the trade, the Guru says "well you know, every quote and liquidity figure is different on different platforms, funny how they never use the word HUB, guess they just don’t know. Anyway, in Futures you cannot get away with this, since the exchange has time and sales records all you have to do is look at the T/S, and see if a trade of that size executed at that time, or if there was enough liquidity to execute against. To me its kind of cool to see your trade in the T/S, “Look Honey here I was makin a buck” anyway I digress. Some Futures Gurus when asked by their followers how come their “live pushed” charts don’t match the followers, say, “well each broker is different, latency in server time etc.” Naaaahhhhh, dude you are using a demo platform, thats why you have that “Hypothetical” disclaimer on your site, not because you want to, but because you have to, seeing as you are not trading live. Ooooops, train kind of slipped off the track.
Anyway thats how it is, now here are two more things to think about. Did you know that in Spot Currency the Institutional platforms have a provision for the Prime Brokers to communicate between themselves and Large Size traders? Lot of old fashioned horse trading goes on behind the scenes.
Also did you know there are no Gaps caused by liquidity in Spot Currency?
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