Sve ostalo je iluzija.. Drugo, platforma nije MT4. Osobno sam probao i unutar tjedan dana sve je gotovo Likvidnost je dio odgovora The Structure of Forex Brokers There has been much discussion of late regarding broker spreads and liquidity.
Forex - Stranica 18 -
Many assumptions are being made about why spreads are widened during news time that are built on an incomplete knowledge of the architecture of the forex market in general. The purpose of this article is to dissect the market and hopefully shed some light on the situation so that a more rational and productive discussion can be undertaken by the Forex Factory members.
We will begin with an explanation of the purpose of the Forex market and how it is utilized by its primary participants, expand into the structure and operation of the market, and conclude with the implications of this information for speculators. With that having been said, let us begin. Unlike the various bond and equity markets, the Forex market is not generally utilized as an investment medium. The guy who buys a shiny new Eclipse more then likely will pay for it with US Dollars.
In the old days it was easy enough for a bank to call a foreign bank or a foreign branch of ones own bank and swap the stockpiles of currency each had accumulated from their many customers. Just as any business would, the banks bought the foreign currency at one rate and marked it up before selling it to the customer. With that the foreign exchange spread was born. This was and still is a reasonable cost of doing business. Mitsubishi can pay its customers and the banks make a nice little profit for the hassle and risks associated with moving around the currency.
As a byproduct of transacting all this business, bank traders developed the ability to speculate on the future of currency rates. Utilizing a better understanding of the market, a bank could quote a business a spread on the current rate but hold off hedging until a better one came along. This process allowed the banks to expand their net income dramatically. The unfortunate consequence was that liquidity was redistributed in a way that made certain transactions impossible to complete.
It was for this reason and this reason alone that the market was eventually opened up to non-bank participants. The banks wanted more orders in the market so that a they could profit from the less experienced participants, and b the less experienced participants could provide a better liquidity distribution for execution of international business hedge orders. To understand the structure of the Interbank market, it may be easier to grasp by way of analogy.
Each computer operates independently of the others until it needs a resource that another computer possesses. At that point it will contact the other computer and request access to the necessary resource. If the computer is working properly and its owner has given the requestor authorization to do so, the resource can be accessed and the initiating computers request can be fulfilled. By substituting computers for banks and resources for currency, you can easily grasp the relationships that exist on the Interbank.
Anyone who has ever tried to find resources on a computer network without a server can appreciate how difficult it can be to keep track of who has what resources. The same issue exists on the Interbank market with regard to prices and currency inventory. A bank in Singapore may only rarely transact business with a company that needs to exchange some Brazilian Real and it can be very difficult to establish what a proper exchange rate should be.
Layered on top in a manner of speaking of the Interbank communication links, the EBS service enables banks to see how much and at what prices all the Interbank members are willing to transact. Pains should be taken to express that EBS is not a market or a market maker; it is an application used to see bids and offers from the various banks. The second tier of the market exists essential within each bank. By calling your local Bank of America branch you can exchange any foreign currency you would like.
More then likely they will just move some excess currency from one branch to another. Since this is a micro-exchange with a single counterparty, you are basically at their mercy as to what exchange rate they will quote you. Your choice is to accept their offer or shop a different bank. Everyone who trades the forex market should visit their bank at least once to get a few quotes.
It would be very enlightening to see how lucrative these transactions really are. Branching off of this second tier is the third tier retail market. When brokers like Oanda, Forex. Nine in ten of these brokers will sign an agreement with just one bank. This bank will agree to provide liquidity if and only if they can hedge it on EBS inclusive of their desired spread.
- corretora forex ecn!
- We are rebranding!
- Online trading forum; лучшая биржа bitcoin.
- vix trading signals?
- cap kuwait forex.
- NAJLEPSZE PLATFORMY OPCJI BINARNYCH.
Because the volume will be significantly higher a single bank patron will transact, the spreads will be much more competitive. By no means should it be expected these tier 3 providers will be quoted precisely what exists on the Interbank. Remember the bank is in the business of collecting spreads and no agreement is going to suspend that priority. Retail forex is almost akin to running a casino. The majority of its participants have zero understanding how to trade effectively and as a result are consistent losers.
The spread system combined with a standard probability distribution of returns gives the broker a built in house advantage of a few percentage points. As a result, they have all built internal order matching systems that play one loser off against a winner and collect the spread. On the occasions when disequilibrium exists within the internal order book, the broker hedges any exposure with their tier 2 liquidity provider.
As bad as this may sound, there are some significant advantages for speculators that deal with them.
Because it is an internal order book, many features can be provided which are otherwise unavailable through other means. Non-standard contract sizes, high leverage on tiny account balances, and the ability to transact in a commission free environment are just a few of them… An ECN operates similar to a Tier 2 bank, but still exists on the third tier. An ECN will generally establish agreements with several tier 2 banks for liquidity. However instead of matching orders internally, it will just pass through the quotes from the banks, as is, to be traded on.
There are many advantages to the model, but it is still not the Interbank. The banks are going to make their spread or their not go to waste their time.
Regulation and Security
Depending on the bank this will take the form of price shading or widened spreads depending on market conditions. The ECN, for its trouble, collects a commission on each transaction. Aside from the commission factor, there are some other disadvantages a speculator should consider before making the leap to an ECN. Most offer much lower leverage and only allow full lot transactions.
During certain market conditions, the banks may also pull their liquidity leaving traders without an opportunity to enter or exit positions at their desired price. Unfortunately belief does not negate the reality that for every buyer there MUST be a seller or no transaction can occur. When an order is too large to transact at the current price, the price moves to the point where open interest is abundant enough to cover it.
Every time you see price move a single pip, it means that an order was executed that consumed or otherwise removed the open interest at the current price. There is no other way that prices can move.
Trading – Czym jest? jak zacząć? Wszystko, co musisz wiedzieć
As we covered earlier, each bank lists on EBS how much and at what price they are willing to transact a currency. It is important to note that no Interbank participant is under any obligation to make a transaction if they do not feel it is in their best interest. Using this information, if a market sell order was placed for No broker, market maker, bank, or thief in the night widened the spread; it was the natural byproduct of the order that was placed. If no additional orders entered the market, the spread would remain this large forever. Fortunately, someone somewhere will deem a price point between those 2 figures an appropriate opportunity to do something and place an order.
- handelszeiten forex weihnachten!
- Porady i Wiadomości;
- Co to jest trading?;
- binary option de djezy.
- 17 Replies to “Nekstra Review: Nekstra.com Amazing Trading Platform Unveiled”.
- banking binary.
That order will either consume more interest or add to it, depending whether it is a market or limit order respectively. What would have happened if someone placed a market sell order for 2mil just 1 millisecond after that They would have been filled at 1.
Online Forex grafikoni
Because there was no one to take the other side of the transaction at 1. Again, nobody was out screwing the trader; it was the natural byproduct of the order flow. A more interesting question is, what would happen if all the listed orders where suddenly canceled?