The bad side from Fxsol(suspicious activity) - Page 2
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Thread: The bad side from Fxsol(suspicious activity)

  1. #11
    Quote Originally Posted by ;
    Hello . Are you being sarcastic? My question is a severe one. I am still studying but not losing. I am on a good run here. So there's an opportunity that my broker doesn't need my business?
    KISSFan
    You need to rest easy, I was refering to traders who trade big lots and consistently make lots of money.

  2. #12
    That seems somewhat odd. Why wouldn't brokers enjoy FXsol and FXCM would like you to generate income. They have paid a commision if you win or lose right?

  3. #13
    Brokers take the opposite side of your transaction so when you win, they lose.
    Unless they are hedging using a counterparty but the majority of the time they didnt scam since they know that most traders get rid of money so that they keep the transaction in house. Your loss becomes their profit.

  4. #14
    Http://www.fxsolutions.com/trading/a...-execution.asp

    This means 99 percent of the time they take the opposite side of your transaction and should you lose they win. Notice how they dont say 99 percent of trades move right to banks. If customers make a transaction that FXSol does not wish to keep the other side of they have the ability to offset together with their LP's to get a far better price they then provided the customer. However, they appear to have clients that like trading together and if you are only then stick with whatever you like. I dont attribute FXSol for doing so if traders still wish to trade together. There is enough on FXCM onnigeriaforextradingwhere I dont have to say anything but I dont think that their practices are substantially different but they've got better spreads but I still doubt FXCM has improved execution.

  5. #15
    Quote Originally Posted by ;
    Brokers take the other side of your transaction so once you win, they lose.
    Unless they are hedging using a counterparty but most of the time they didnt scam since they are aware that most traders get rid of money so they keep the trade at house. Your loss becomes their profit.
    OK. Let's say I am a broker with 10,000 customers. 500 are trading profitable. I leave them alone to exchange and only produce the spread/commission and choose the other side of the transaction on another 9500. I can see who is aware of what they are doing and those who don't. Is it a realistic situation?

  6. #16
    Quote Originally Posted by ;
    OK. Let's say I am a broker with 10,000 clients. 500 are trading profitable. I leave them to trade and just produce the spread/commission and take the opposite side of the trade on another 9500. I am able to see who knows what they're doing. Is it a realistic situation?
    Yes and most brokers run two books; A Novel (profitable traders) and B Novel (non-profitable traders). If their technology allows it they can place those traders directly through into the banks plus they must cancel their postions with banks.

  7. #17
    Quote Originally Posted by ;
    Yes and most brokers run two books; A Book (profitable traders) and B Book (non-profitable traders). If their technology permits it they can put those traders straight through to the banks plus they have to cancel their postions with banks.
    Interesting stuff. Thank you for the information!

  8. #18
    I understand that some brokers do bank off of losing traders but would not this hurt their company?

    If their clients are departing then they can not make money from spreads because nobody is trading together. If this is the case then we'll start to see more retail Currency Market brokers running from company in the near future.

    These retail brokers will need to understand that they're not the only method to exchange currency. The CME Futures currencies is a mouse click away.

  9. #19
    Quote Originally Posted by ;
    I understand that some brokers do bank from losing traders but wouldn't this hurt their company?
    No. They feed off newbies and there are plenty of these around. People who dismiss their accounts are easily substituted by lots of new eager Foreign Exchange traders on their way to dismiss off their new account.
    Just think. How does a casino make money? Same for your Foreign Exchange retail broker.

  10. #20
    Quote Originally Posted by ;
    No. They feed newbies and there are plenty of them around. Those who dismiss their accounts are easily replaced by plenty of new excited forex traders on their way to dismiss off their new account.
    Just think. How does a casino earn money? Same for the forex retail broker.
    Legitimate point...

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