ECN and Market Maker survival guide
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thread: ECN and Market Maker survival guide

  1. #1
    Junior Member galanmovil2's Avatar
    24

    ECN and Market Maker survival guide

    I hope this reminds you the basics you need to know about Forex market participants, the way they operate and what should you expect from these. The principle intent of this thread would be to discus Market Maker and Electronic Communiion Network brokers.


    ECN is a community of market participants such as banks, market makers, companies and standalone traders. All of these offer liquidity and discuss the best bid/ask prices. An ECN broker joins his liquidity providers (the more the merrier) and provides full market depth. A legitimate ECN broker has no conflict of interest with the customer. Contrary, the broker is interested, a trader has a long and happy trading life. The bigger the funds a trader gets, the greater and the bigger transactions he makes, the greater trade fees he or she pays. Sounds great does not it?


    So what is holding all traders out of shing to ECN brokers? The lack of fundamental knowledge. They are underedued about the brokers and this creates the fanciful disadvantages. Additionally, traders have been accustomed to Market Makers, shing one for another, expecting they will find the very best one. However, as sad as it may be -- they won't. It will become evident, when you understand how Market Makers operate. I love an easy and simple explanation about MMs and ECNs. Market Maker is just like a casino, you gamble versus the casino sometimes you win, but most of the time you lose. As everyone understands -- casino always wins. Generally, market makers have no liquidity. You do not trade beyond their brokerage firm. What you get is a Forex simulation with the illusion of money, expecting to win, but the broker places all of the effort for you to go down. The more you eliminate the more they profit.


    As for its ECN brokers, their like a poker tournament. You play versus the rest of the gamers and your results depend only on your skill. As straightforward as that.


    The traders and brokers have been stuck in the constant loop. The identical trading platformsthe same provides and above all the same problems. Even if you will find the proclaimed bonus to your account, you will inevitably lose it together with your capital. And then starts the blaming game. If folks would understand the essence of MM's they would not blame them. It is just the way they operate.


    Considering the fact, the future of Forex trading belongs to Electronic Communiion Network (ECN) brokers, there should be several major brokerage firms evolving and suggesting ECN trading opportunities to traders searching for it. Many comparisons and reviews about MM vs. ECN indie a few of the disadvantages of the ECN --huge capital required to trade, variable spreads and large trade fees, bad trading platforms. These arguments are completely obsolete.


    Nowadays, you don't want a truckload of greenbacks to trade ECN. The majority of the brokers deliver mini accounts -- you'll need about 400 - 1000 dollars to begin trading. About perfect for novices and traders who wish to test the ECN atmosphere.


    Factor spreads, well, they may be a bit upsetting at times. But this is the true Forex market atmosphere. Fixed spreads are irrational. They can't be fixed, that's the character of the spreads. They proceed, depending on the market requirements. They may go up to 1-2 pips or higher, but they can go as low as 0,4 or less. Taking this into account it's not really bad is it? Scalpers should be jumping high into the atmosphere. Low spreads is the Market Maker bait in their opinion. However they could not provide spreads as much as ECN's. Based upon your trading experience and fashion, variable spreads shouldn't be a problem for you either.


    Let's look in the trade fees. Let's say, which you're trading EURUSD and the spreads are as low as 0,4. You open a 100k place and pay about ~3$ for it. Would you dare to compare this cost of trade with costs of a Market Maker? I guess .


    So does the future belong to ECN? It is merely inevitable. In the not too distant future, the people will probably be shing to ECN brokers; the market maker times are long past due. This will happen, when traders' perception about market participants increase. People must talk, write and study more about the market participants. Every single trader, starting from the newcomer, should know full well, when choosing a broker, while it is an ECN or an MM broker, what should he expect and the way the broker operates. Question every announcement and suggestion your broker gifts. There is no such thing as free money.


    There is more than enough deception, false promises and fake material about Forex in the world wide web. The majority of traders are totally clueless about differences of the brokers and they simply begin searching for answers after they have emptied their accounts. Basically there are not any pros or cons for neither of those brokers. They are different from the core and people trading together should select themnot by error, or simply by being tricked -- only by their personal preference and understanding.


    Place some hard work and analyze every single facet and option prior to opening an account with a brokerage firm. It is your money. Do not give it away so readily.

  2. #2
    Junior Member alexml22's Avatar
    23
    Additionally, many market makers offer you large deposit bonuses around 50%. For your newbie traders, it seems really great. ECN Brokers usually doesn't offer bonuses.

    Regards,

    Josef
    ever see all of the videos gft put out saying ecn and market makers and all are pretty much BS (they dont state it in those words but thats the sum of it)




  3. #3
    Member rheny's Avatar
    40
    So what's holding all traders out of shing to ECN brokers? The lack of fundamental understanding. They are underedued about the brokers and this produces the disadvantages that are imaginary. Moreover, traders are accustomed to Market Makers, shing one for another, hoping they will find the best one. But, as sad as it can be -- they won't. It will become evident, when you understand how Market Makers operate. I adore a simple and plain explanation about MMs and ECNs. Market Maker is exactly like a casino, you gamble versus the casino sometimes you win, but...
    Furthermore, many market makers offer large deposit bonuses around 50%. For your newbie traders, it sounds really excellent. ECN Brokers usually does not offer bonuses.

    Regards,

    Josef

  4. #4
    Junior Member galanmovil2's Avatar
    24
    Hey if you buy a gun, it's a bigger chance that you will shoot somebody. Exactly the same with MT4.

    The only means to eliminate a temptation is to yield to it.
    OSCAR WILDE, The Picture of Dorian Gray

    trendy quote? But I understand exactly what you mean. Everyone is in for the look from one. I am pleased with my brokers. I don't have any use to keep on hunting.

  5. #5
    Junior Member alexml22's Avatar
    23
    Created'Virtual trader' plugin. Developed MT4 bridge into ECN (I think they were the initial ).

    Fast growing company, lot's of cash flowing in. Basically they provide a'complete makeover' from MM into ECN.

    IMHO their technologies stinks. Unstable. And unstable because MT4 and its components are the weakest link. It is not meant to be ECN, however they also made it happen and it's not perfect. One more thing, the bridge should not have been created with a third party in the first place.

    What they do, is provide market manufacturers with more possibilities to...
    Ok well ts no secret what the plug ins and manager allow you to do, you may easily switch the client from ecn into dd etc, however I know that is true with the rear end of other platforms too.

    I am ready to pay extra spread, ready to cover commissions, I dont care, I just need a honest business that is going to continue to keep the deal whereas its ECNSTP without having a reason to tempt them to freeze the system, perform the re-quote sport .

    Boston tech provides their platform from how (mt4) into citi, fxcm etc

    I exchange with considerable amounts of money, but much too small to be able to receive accounts with prime brokers, I had an account with a broker and afterwards making good money they began giving me a hard time with withdrawals, ended up had to sue them to get my cash in order to receive it, my point is I understand there's more to trading than spreads and should the broker isnt honest it dont matter what platform he uses, when he is honest mt4 doesn't matter!

  6. #6
    Junior Member galanmovil2's Avatar
    24
    Developed'Virtual trader' plugin. Developed MT4 bridge into ECN (I think they were the initial ).

    Fast growing company, lot's of money flowing in. Basically they provide a'complete makeover' out of MM into ECN.

    IMHO their technologies blows. Unstable. And unstable because MT4 and its components are the weakest link. They made it happen and it's not perfect, although it's not intended to be ECN. One more thing, the bridge shouldn't have been created with a third party in the first loion.

    What they do, is provide market makers with more possibilities to get inside your pocket. Inadequate MT4 is following their done with it on life support. Check out their'http://www.bostontechnologies.com/' part in their website. You'll know what I mean.
    They require a slice of s.... and cover it with even more s.... And what you get in the end? Yeah, you have it right

  7. #7
    Junior Member alexml22's Avatar
    23
    whats your take on boston tech?

    You seem to know lots on this topic, they are not a broker but you should know why im asking this

  8. #8
    Junior Member galanmovil2's Avatar
    24
    1.Regulated - see just how many controlled brokers obtained fined and more
    2. No MT platform - they have it many need it and even if they dont what makes you believe their private built platform is clean?
    3. Level two price-feed
    4. You pay commissions - you obviously never heard of ECN fashion , edue yourself
    5. Transparent - oh certain who isnt
    ECN style? Might it be associated with doggy-style?

    Anyhow, for you have another alternative: best way to find out if a broker is the ECN until you start a new account - you ought to go and read every contract between the broker and banks, also talk with their legal department, accounting and ask the CFO come to your home for supper and depart his first born child as hostage before your very first transaction is executed.

    Or you could assess 1-5 brokers, having in mind what I wrote before and just have a 90% chance that the broker is currently ECN.

    You may never be 100% sure, if you don't work in that company yourself.

    As for people requesting for MT4 - I ask you punch yourself in the face! Can you do it? No - because it's stupid. MT4 for ECN is just pure insanity IMHO.

    As for regulation - see just how many controlled brokers haven't been fined. Now which are you going to select Regulated and fined; Regulated and un-fined; Unregulated?

    Hello,
    Thank you for your reply. Let me ask a naive question, what is Level two price-feed and Transparent means what?
    ECN system connects the broker with multiple financial institutions (mainly banks). Level 2 displays the orders put in those banks expressed as quantity at each accessible price.
    Market manufacturers cannot show level 2 since there is simply two counter-parties - a client (you) along with a broker (MM) trading between themselves. They do not connect traders to banks or other financial institutions.
    From the ECN banks trader and other traders all see each other trades.

    Transparancy - when broker publishes information about their profit, clients, liquidity providers, board of supervisors, places etc.. When a broker answers all of your questions and you are not feeling as being f-ed over. Whenever you are invited for their own office, when they reveal their admin pannel for you, once you can really expect a broker. And so on

    Do you believe MF Gloabl is a ECN broker and are they a trustworthy broker?
    I am here not to judge and rate brokers. Nor am I to say who's'REAL ECN' and who's not. You may only judge by your personal experience along with your own gut.

  9. #9
    1.Regulated
    2. No MT platform
    3. Level 2 price-feed
    4. You pay commisions
    5. Transparent

    P.S. To ones who say - Oh'this' broker has MT4 and he is ECN - FU. If an ECN broker has MT (I will repeat myself) he is a whore.
    Hi Rader,
    Thanks for your reply. Allow me to ask a naive question, what is Level 2 price-feed and Transparent means what?

    Do you think MF Gloabl is a ECN broker and are they a trustworthy broker?

  10. #10
    Junior Member alexml22's Avatar
    23
    1.Regulated
    2. No MT platform
    3. Level two price-feed
    4. You pay commisions
    5. Transparent

    P.S. To ones who say - Oh'this' broker has MT4 and he's ECN - FU. When an ECN broker has MT (I will repeat myself) he's a whore.
    1. Regulated - see just how many regulated brokers got fined and more
    2. No MT platform - they have it many demand it and even if they dont what makes you think their personal built platform is clean?
    3. Level two price-feed
    4. You pay commisions - you obviously never heard of ECN style etc, instruct yourself
    5. Transparent - oh sure who isnt

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