Best Broker for a Newbie

FxMasterGuru posted:
I am running the same EA with IC Markets ('TrueECN) and with a new DMA/STP FCA regulated London based broker and the difference is significant using the same exact EA with the same exact parameters...

Just a couple of days ago ICM quoted a 7 pips spread on CADCHF on my ''TrueECN'' account, while my new FCA regulated pure STP/DMA broker quoted 2.5 pips at the same time... It makes one wonder how ''TRUE'' ICM's ''TrueECN'' is...??!

Probably it is not a secret that it is a 'B-booked' pseudo-ECN ''THING''...

Really, ''no shit''...

I am wondering how actually 'ECN' is related to 'DMA/STP' if there is anything in common at all. From what you write, I understand that True ECN does not necessarily mean DMA/STP so it could be confusing for the new traders with all these terms.

Bohdan73 posted:

mlawson71 posted:
The German regulator BaFin are also considering similar measures as the FCA's. They announced their intentions to “limit the marketing, distribution and sale of financial contracts for difference (CFDs) with an additional payments obligation” to retail clients. (https://www.forexbrokerz.com/news/germany-bafin-to-ban-margin-trading-cfds)
 
This means that in theory margin trading could be altogether banned in Germany, as, according to BaFin, the risk of losses for the retail clients are “incalculable”. In its statement the regulator explains that if the difference to be paid by the retail client exceeds the capital they have invested, they must pay the difference amount from their other assets.

Thanks for the article. Let's see what will be further decided after 20th of January 2017. Not sure if these restrictions will apply to all brokers in Germany.

Drahy Karle, Bohdnae :)

Which broker is the one better than IcMarkets?

@Bohdan73

In practice they are the same (i.e. ECN, STP, DMA) using different technologies.

The issue I brought up is that some brokers advertise themselves as providing ''ECN'' accounts - which are actually not real ECN accounts - only their spreads resemble (or not) to real ECN accounts.

In practice they ''B-book'' their clients, so the trades NEVER see the REAL ECN market, instead, the broker takes the other side of the trades ''in-house'' acting as a Casino. There is nothing wrong with that UNTIL THE POINT, when they start manipulating the spreads and other aspects of trade executions using a sophisticated parasite software, called ''VIRTUAL DEALER PLUG-IN''...

Getting back to the previous example: Why would ICM's TrueECN CADCHF spread be 7 pips while at another broker the CADCHF ECN spread - at the same moment - was only 2.5 pips... I let you answer this puzzle...

Three of the leading UK forex brokers – CMC Markets, IG Group, and Gain Capital’s City Index, are forming a contract for difference (CFD) providers association as a response to the recent announcement of the UK Financial Conduct Authority (FCA) that it intends to alter the regulation of forex trading service providers. (https://smnweekly.com/2016/12/08/cmc-markets-ig-group-city-index-are-forming-uk-cfd-association-on-back-of-fca-forex-limitations/) The new rules are proposals at this point and the regulator is seeking market participants’ feedback. The newly-formed CFD association will facilitate brokers in communicating their concerns and worries.

Do you think they'd be able to change something?

FxMasterGuru posted:
@Bohdan73

In practice they are the same (i.e. ECN, STP, DMA) using different technologies.

The issue I brought up is that some brokers advertise themselves as providing ''ECN'' accounts - which are actually not real ECN accounts - only their spreads resemble (or not) to real ECN accounts.

In practice they ''B-book'' their clients, so the trades NEVER see the REAL ECN market, instead, the broker takes the other side of the trades ''in-house'' acting as a Casino. There is nothing wrong with that UNTIL THE POINT, when they start manipulating the spreads and other aspects of trade executions using a sophisticated parasite software, called ''VIRTUAL DEALER PLUG-IN''...

Getting back to the previous example: Why would ICM's TrueECN CADCHF spread be 7 pips while at another broker the CADCHF ECN spread - at the same moment - was only 2.5 pips... I let you answer this puzzle...

Thank you for the detailed answer. Yes makes sense. From what I read in Investopedia, I have the impression that the ECNs are anonymous networks. Maybe this fact is used by the b-book broker to still hold the trades in-house but keep referring to an ECN type of execution... Not, sure, just thinking loud.

@togr Not sure why you ask me this question 😄 I don't have experience with ICMarkets.

TickMill

The good Forex broker always makes sure security of funds, low transaction cost, easy withdrawal system, free demo trading, larges bonuses, lowest trading spreads, minimum margin requirement and much more real trading facilities that are very supportive to lead a flexible trading life with certainly.

mlawson71 posted:
Three of the leading UK forex brokers – CMC Markets, IG Group, and Gain Capital’s City Index, are forming a contract for difference (CFD) providers association as a response to the recent announcement of the UK Financial Conduct Authority (FCA) that it intends to alter the regulation of forex trading service providers. (https://smnweekly.com/2016/12/08/cmc-markets-ig-group-city-index-are-forming-uk-cfd-association-on-back-of-fca-forex-limitations/) The new rules are proposals at this point and the regulator is seeking market participants’ feedback. The newly-formed CFD association will facilitate brokers in communicating their concerns and worries.

Do you think they'd be able to change something?

They will make some more noise but I don't think much will be changed.

TheLastBear posted:
There is no such thing as best broker for a newbie, true. A good broker is good for all. I disagree that the best brokers do not offer bonuses. There are plenty of good brokers who do offer bonuses and have loyalty programs. It also depends on what you consider the best broker. Most use the MT4 or MT5 platform. Spreads are one thing you can judge them by. I judge by customer service and security of my funds. Execution of trades is also part of it.

I must agree with this one, and I believe it would always depend on you what would be the best broker that would fit you.

skyjack777 posted:
Hi All,
       Have just been to the reviews on Brokers. I'll ask the question here. For someone in Australia, with a micro account between $250 to $500 dealing with .01 lots, is there any Brokers that come to mine. Thanks Bruce

@skyjack777
the answer is simple. With such small capital go for cent account.

carl54 posted:
The good Forex broker always makes sure security of funds, low transaction cost, easy withdrawal system, free demo trading, larges bonuses, lowest trading spreads, minimum margin requirement and much more real trading facilities that are very supportive to lead a flexible trading life with certainly.

Most of what you say is common sense but why you didn't mention anything about trading against clients? This can be very dangerous for newbees I think. What kind of trading facilities support your trading?

MC85 posted:

They will make some more noise but I don't think much will be changed.

You're probably right. CMC Markets, for example, have already seen the writing on the wall and they're planning on moving away from the UK. Apparently they want to relocate parts of their business to Germany. (https://www.forexbrokerz.com/news/cmc-markets-to-move-out-of-the-uk). I doubt they'd be the last to do that.

carl54 posted:
The good Forex broker always makes sure security of funds, low transaction cost, easy withdrawal system, free demo trading, larges bonuses, lowest trading spreads, minimum margin requirement and much more real trading facilities that are very supportive to lead a flexible trading life with certainly.

Just add ''not using virtual dealer-plug-ins'' and you have the perfect non-existent Forex 'Unicorn' Broker... (i.e. from the fairy tales...)

If you were wondering where is the UNICORN on the image below, it is BEHIND the ''Fairy''... 😀 No, she is not the trader-girl from next door...

FxMasterGuru posted:
Just add ''not using virtual dealer-plug-ins'' and you have the perfect non-existent Forex 'Unicorn' Broker... (i.e. from the fairy tales...)

So you say there is no broker that does not use such a plugin? Sorry if I got your point wrong.

NEEnah posted:

FxMasterGuru posted:
Just add ''not using virtual dealer-plug-ins'' and you have the perfect non-existent Forex 'Unicorn' Broker... (i.e. from the fairy tales...)

So you say there is no broker that does not use such a plugin? Sorry if I got your point wrong.

Approx. 95% of brokers use such plug-ins on accounts trading below 50 lots (this specific info is from the owner of a broker). Also, they don't use plugins on long-term very profitable accounts as they can attach plugins only to ''B-booked'' accounts and it is not good business for them to ''B-book'' stable profitable accounts. Some brokers don't use plugins at all, but it is very difficult to find them.

Establishing pure ''non B-booking'' broker firms has become a ''niche'' market lately. These firms are mostly FCA regulated and based in the UK, and they are OK with making profits from commissions only, however, to collect enough revenues this way (i.e. just from commission), they have to have larger clients, so their minimum deposits are usually start at $5000. They are so-called ''boutique brokers'' catering to the needs of larger investors who need pure ECN/STP/DMA trading environment.

Forex EXPOs are FULL of vendors selling ''virtual dealer plug-ins'' to B-booking brokers and they are offering better and better tools for such brokers to skin their smaller funded and less profitable clients ALIVE. This is an introduction from the brochure of a vendor:

I thought this was a discussion for newbies, and you guys are already talking about more professional traders and brokers.

Some good news for people trading with American brokers - The National Futures Association (NFA), the self-regulatory organization overseeing the activities of the US forex brokers, said its new rules on disclosure of transaction data have been approved by the Commodity Futures Trading Commission (CFTC) and will come into effect as of March 31, 2017. These rules will enable US retail traders to gain access to transaction data and to review the quality of execution. (https://www.forexbrokerz.com/news/US-retail-traders-to-have-greater-transparency-with-respect-to-transaction-data) Transaction data must be provided within 30 minutes of receiving a request.

HarriOshord posted:
I thought this was a discussion for newbies, and you guys are already talking about more professional traders and brokers.

I think the title is a little bit off... Why would a newbie deserve a different (i.e. worse) broker than a pro...?

Actually a newbie would need the BEST BROKER POSSIBLE from the very beginning not to become a victim of price and slippage manipulating B-booking 'virtual dealer plugin' brokers, making his first steps even more difficult... Not to mention outright scam brokers registered mostly on exotic islands with no regulations whatsoever...

Should anyone need a pure STP/DMA (i.e. ECN) FCA regulated broker with 50,000 GBP FSCS insurance and affordable minimum deposit, please PM me, or send direct e-mail to the address in my profile.

Actually a newbie would need the BEST BROKER POSSIBLE from the very beginning

I Totally agree, that s why I just started with an ECN broker that I found on https://www.mrforex.com even if I think that is not the best broker according to some reviews afterwards, it s not a so bad choice for a beginner.