The Spread and Profit? - Page 2
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Thread: The Spread and Profit?

  1. #11
    Quote Originally Posted by ;
    quote My perception is that you do not really exchange for 18 hrs per day which makes those micro profits, but instead 18 hrs to get in and out as often as possible. Scalping for 18 hours per day assuming that a maximum of 15 minute per transaction that results to a massive 72 trades every day, just a machine can do that, but you never know actually.
    72 trades a day isn't that enormous really. Have you seen transcripts of demo contests participants?

  2. #12
    Targeting 3 pips on a 2 pip spread is insane just for the simple truth that spread is always shing on most brokers. So that the 1 pip profit, would be cut if the spread increases even by the tiniest amount. And lets not say exactly what 1 loss could do for your account along with the work which will be needed to just recover from that 1 loss. . .depending in your stop loss, but whatever you decide on, I am willing to bet you'd need a success rate of close to 99.99 percent to become profitable...:/

    afford the pipsology course, it is a free...

  3. #13
    Quote Originally Posted by ;
    Hello. If the spread is two pips does that mean I need to goal 3 pips in order to produce a profit? Thanks.
    In case your spread is two pips you need 4 pips just to break even and 5 pips to create a profit. You pay when you walk in the market and you pay in your way out.

    You may find this post helpful in determining how much disperse affects trading.
    https://www.nigeriaforextrading.com/...1-markets.html

  4. #14
    Quote Originally Posted by ;
    quote in case your spread is 2 pips you need 4 pips just to break even and 5 pips to make a profit. You pay when you walk on the market and you pay on your exit. You may find this post useful in determining how much disperse affects ones trading. Https://www.nigeriaforextrading.com/...ce-action.html
    that is accurate, can't forget about giving up those extra pips when you exit a transaction!

  5. #15
    Except for the Question, but this is what the broker is making? This four pips? 2 on the road out on the way in and 2?

  6. #16
    Quote Originally Posted by ;
    Hello. If the spread is 2 pips does this mean I want to target 3 pips in order to make a profit? Thanks.
    No.

    Assuming you're comparing like with like, (when it comes to roundtrip/per leg) s noted by Sys.iphus above. .
    Spread is only one element.
    The key metric is Transaction Cost, which accounts for the totality of Execution costs . . Such as slippage etc..

    There are enormous variations in TC involving brokers.
    The profitability of all scalping egies are tremendously broker specific.

  7. #17
    Quote Originally Posted by ;
    Hello. If the spread is two pips does that mean I want to target 3 pips in order to make a profit? Thanks.
    No. Spread is currently embedded in the introductory price of this trade. Therefore, to acquire profit 1 pip is enough, irrespective of the value of this spread.

  8. #18
    Quote Originally Posted by ;
    quote No. Assuming you're comparing like with like, (when it comes to roundtrip/per leg) s noted by Sys.iphus above. . Spread is 1 element. The important metric is Transaction Cost, which accounts for the totality of Execution expenses . . Including slippage etc.. There are variations in TC between brokers. The profitability of all scalping egies are highly broker specific.
    I can't agree more. This is just what makes takes be aback when I visit someone presuming a demo account can be an ideal way of practicing trading. In my view, sue to issues like slippages in live trading, I feel a demo account is much better used for practicing various trading egies, and perhaps getting to know what moves what currency.
    Finally, I believe brokers are thrilled when they visit a scalper.

  9. #19
    Quote Originally Posted by ;
    quote I can't agree more. This is exactly what makes happens be aback when I see somebody presuming that a demo account can be an ideal way of practicing trading. In my view, sue to issues like slippages in live trading, '' I think a demo account is much better used for practicing different trading egies, and perhaps getting to understand what moves what currency. Finally, I think brokers are delighted when they see a scalper.
    Thank you for remark Moonshot. .
    I refer to the accountable cost metrics being discussed previously (commission/spread/volume terms etc ) as Considered Transaction Costs (comparative easy to measure).
    And the latency/slippage/execution type costs, as Hidden or Sudden Transaction Costs The problem is that these can't be accurately modeled in your broker Demo/Test information, since they are highly variable and Broker particular.

    A current Boston Technologies Blog by Anna Aratovskaya, quotes Rishi N Rang and his book Inside the Black Box,. . As follows. .
    UTC/slippage accounts for more than half of all transaction cost combined. If you've already calculated your monthly Considered Cost, now double it - what percentage of your overall monthly profit and loss would that be? ....
    And goes on to remark on how hard these costs are to model out of demo/test data.


    Institutional Transaction Cost Analysis has become a major focus in institutional trading. . And has exposed differences between different brokerage services.
    That I can only imagine what proper TCA would reveal if employed to Retail Brokers. LoL
    Hope this of help.

  10. #20
    Quote Originally Posted by ;
    quote I can not agree more. This is exactly what makes takes be aback when I see somebody presuming that a demo account can be an perfect way of practicing live trading. In my opinion, sue to issues like slippages in live trading, '' I feel a demo account is much better used for practicing various trading egies, and possibly getting to understand exactly what moves exactly what currency etc.. Finally, I think brokers are ever thrilled when they see a scalper.
    Thank you for remark Moonshot. .
    I refer to the accountable cost metrics being discussed previously (commission/spread/volume terms etc ) as Considered Transaction Prices (relative easy to quantify).
    And the latency/slippage/execution type expenses, as Hidden or Sudden Transaction Prices The challenge is that these can't be accurately modeled on your broker Demo/Test information, because they are highly variable and Broker specific.

    A current Boston Technologies Blog by Anna Aratovskaya, quotes Rishi N Rang and his book in the Black Box,. . As follows. .
    UTC/slippage accounts for over fifty percent of all trade cost combined. If you've already calculated your monthly Cost, now double it - exactly what proportion of your total monthly profit and loss would that be? ....
    And goes on to remark on how hard these prices are to model from demo/test data.


    Institutional Transaction Cost Analysis has become a major focus in institutional trading. . And has exposed startling differences between different brokerage services.
    That I can only imagine what appropriate TCA would reveal if employed to Retail Brokers. LoL
    Hope this of help.

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