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  • #841
  • Edited 12:37am Jun 9, 2009 12:23am | Edited 12:37am
Quoting blazespinnaker
I'm pretty surprised people aren't rising up against this 5 pip spread stuff. That's totally not my experience at all on Oanda. In fact, they have hugely competitive spreads that are only beat out by the high volume ECN trading systems.
On a second thought (as to "quotes") I forgot to mention the "lag" between actual price and boxed quotes which can make quite a difference sometimes... this is the reaason why I don't trust the box quotes so much as the ticket price which is, in my opinion, the most accurate of all four quotes (ticket, trade window, box quotes, chart price).
  • #842
  • Jun 9, 2009 4:32am Jun 9, 2009 4:32am
Quoting doblece
I don't trust the box quotes so much as the ticket price
What are box quotes?



__________________
blazespinnaker: "I do trade on a pure ECN. Though you can't beat the spread on some of the bucketshops."
  • #843
  • Jun 9, 2009 6:51am Jun 9, 2009 6:51am
Quoting pipmutt
What are box quotes?
The ones on the quote panel (with big numbers).
  • #844
  • Jun 9, 2009 7:05am Jun 9, 2009 7:05am
Quoting doblece
The ones on the quote panel (with big numbers).
Right, thanks.
  • #845
  • Jun 9, 2009 10:00am Jun 9, 2009 10:00am
USD/JPY spread 0.9 pips
The only way to get smarter is by playing a smarter opponent.
  • #846
  • Jun 9, 2009 11:44am Jun 9, 2009 11:44am
Quoting pipmutt
It could be because most people are capable of a bit of lateral thinking and have enough common sense to know when they
I haven't found anyone who agrees with you. My guess is they simply don't care to correct what is obviously a hyper absurd statement on your part.

Oanda is not the most expensive way to trade EUR/USD. And it doesn't have a 5 pip spread. It has a variable spread, which frequently hits 0.9 pips.

And you're misquoting me in your signature. I am saying Oanda is competitive with ECNs. But obviously you're all about the complete obliviousness to reality, so I shouldn't be surprised.
  • #847
  • Jun 9, 2009 11:47am Jun 9, 2009 11:47am
Quoting doblece
On a second thought (as to "quotes") I forgot to mention the "lag" between actual price and boxed quotes which can make quite a difference sometimes... this is the reaason why I don't trust the box quotes so much as the ticket price which is, in my opinion, the most accurate of all four quotes (ticket, trade window, box quotes, chart price).
Yes, I see the same lag as well. But it's just a software glitch issue. I think having a faster machine might help.
  • #848
  • Jun 9, 2009 12:28pm Jun 9, 2009 12:28pm
Quoting blazespinnaker
And it doesn't have a 5 pip spread.
I didn't say Oanda have a 5 pip spread on Eur/Usd, what I said was (referring to trading Eur/Usd with shops like Oanda) "in reality you're probably paying something like 0.05% round turn compared to around 0.012% on an ECN, that's exorbitant!".

If you still can't understand the issue from what I've previously posted in this thread, and if you lack the common sense to even research the subject, then I really don't think I can help you any further. You're exactly the type of punter who this kind of advertising was designed for and no doubt Oanda will be pleased it's working so well.

Quoting blazespinnaker
And you're misquoting me in your signature. I am saying Oanda is competitive with ECNs. But obviously you're all about the complete obliviousness to reality, so I shouldn't be surprised.
It's not a signature, it's a copy and paste 'but obviously you're all about the complete obliviousness to reality, so I shouldn't be surprised'

I'm not misquoting you though, in this post you said, and I quote: "I do trade on a pure ECN. Though you can't beat the spread on some of the bucketshops.. (ie, Oanda)"

I'm not being funny but don't you think this is a bit of a futile argument? So unless you have anything new to add then please excuse me if I don't reply, thanks.


__________________
blazespinnaker: "I do trade on a pure ECN. Though you can't beat the spread on some of the bucketshops."
  • #849
  • Jun 9, 2009 5:33pm Jun 9, 2009 5:33pm
"in reality you're probably paying something like 0.05% round turn compared to around 0.012% on an ECN, that's exorbitant!"

Huh?

0.05% of 100K eur = EUR 50 (USD ~70) - so 7 pips at current rates. So since the spread is typically between 0.9 and 1.2 you are saying Oanda slips you ~6 pips total on a regular basis for entry+exit (or ~3 pips each). Or are you saying the Oanda rates differ by that amount from the "true" market?

Just for the record, after ~2000 fills on Oanda i can say this statement is not true.
  • #850
  • Jun 10, 2009 2:28am Jun 10, 2009 2:28am
Quoting shrike

Just for the record, after ~2000 fills on Oanda i can say this statement is not true.
In which case I have an advantage over you in that I've had over 6,000 orders executed on Oanda's FX Trade and I can say without hesitation that it is true, so where does that leave us

(By the way it might help to actually understand the issues first before declaring it's not true!)

It's all in my previous posts anyway, do your own reasearch on the subjects if you're interested, if you're not then don't, makes absolutely no difference to me either way.

Anyway, have a great trading day!



__________________
blazespinnaker: "I do trade on a pure ECN. Though you can't beat the spread on some of the bucketshops."
  • #851
  • Jun 10, 2009 2:54am Jun 10, 2009 2:54am
Would it kill you to provide at least one citation / link to this so called research? You're generally very skilled, amongst the most skilled around here, at providing links to back up your points.

I've never heard (and I've googled it after you talked about it, as I was very very curious to see if anyone remotely backed this up) of anyone anywhere ever claiming that Oanda had 5 pip spreads because of 'hidden costs'.

I've heard of people complaining about spikes and stop hunting, but there are things you can do to avoid that.

But this 5 pip stuff? I've just never heard of it.

Here are some things you've said:

Quote
but as far as I've managed to find out this is partially driven by broker directional bias as well as their book so it would disadvantage a winning trade every time (providing the broker predicted direction correctly, more algorithms!), that together with suppressing or 'smoothing' quotes to suit their book and market volatility puts the trader at even more of a disadvantage (or less of an advantage depending on which way you look at it).

First, 'smoothing' quotes ... I don't see how that adds to trading costs. All that does is let Oanda have tight spreads! Oanda has a slight problem because I think they will sometimes offer spreads that tighter than what the general market is providing! So they have to 'smooth' the data in order to market make better than the banks are market making.

As for the broker predicting market direction.. that's an interesting statement, that they can somehow predict reliably which way the market is going to go on an on going, continuous basis. If they could do that, I think they could make billions and not millions.
  • #852
  • Jun 10, 2009 3:48am Jun 10, 2009 3:48am
Quoting blazespinnaker
Would it kill you to provide at least one citation / link to this so called research?

I've never heard (and I've googled it after you talked about it, as I was very very curious to see if anyone remotely backed this up) of anyone anywhere ever claiming that Oanda had 5 pip spreads because of 'hidden costs'.

I've heard of people complaining about spikes and stop hunting, but there are things you can do to avoid that.

But this 5 pip stuff? I've just never heard of it.
What 'so called research', I've suggested you do your own research on the subjects if you want to learn about them, would that kill you?

You seem to have a fixation about Oanda and their spreads, which bit of "Don't think spread, think quotes" and "I didn't say Oanda have a 5 pip spread on Eur/Usd" didn't you quite understand exactly?

Forget Oanda, I've already said this isn't unique to them, it's simply the way bucketshops skew quotes according to things like their book and market volatility in order to disadvantage the trader, it's the nature of their game and widely accepted as a given by anyone who vaguely understands how these shops operate.



Quoting blazespinnaker
First, 'smoothing' quotes ... I don't see how that adds to trading costs....
Ah this is pointless, it's like trying to educate............ok, in the interest of forum decorum I'll resist the temptation to express what I think about your learning capacity otherwise this thread will probably deteriorate into a slanging match.

Look, like I said to shrike, do your own research on the subjects if you're interested, if you're not then don't, it makes absolutely no difference to me either way.

Going by this and previous discussions where we've bumped heads I'm not sure you've actually got the capacity to understand or to think any other way than in the vertical so really, don't worry about it, just enjoy your trading.

Which reminds me I had better go and do some myself.....have a great trading day, maybe catch you later
  • #853
  • Jun 10, 2009 4:04am Jun 10, 2009 4:04am
pipmutt at least this isn't true for limit orders at Oanda (beside the rare slippage there).

But I understand what you mean. This would only affect scalpers using market orders and I agree, scalping with a market maker is not that a smart idea.
  • #854
  • Edited 4:18am Jun 10, 2009 4:07am | Edited 4:18am
Quote
"in reality you're probably paying something like 0.05% round turn compared to around 0.012% on an ECN, that's exorbitant!"

You're saying the 'effective spread' on Oanda is 5 pips versus 1.2 pips on an ECN. I'm saying this is pure bull****.

And you have absolutely zero to back this up with except vague responses like 'do your own research'.

I'm saying - you have zero credibility. Why participate in a forum if you can't back up what you say with the most basic citation?

You'll probably notice I'm very picky about these sorts of details. It's why my trading is so profitable.
  • #855
  • Jun 10, 2009 4:12am Jun 10, 2009 4:12am
Quoting Xaron
pipmutt at least this isn't true for limit orders at Oanda (beside the rare slippage there).

But I understand what you mean. This would only affect scalpers using market orders and I agree, scalping with a market maker is not that a smart idea.
No Xaron, if you're going to agree with pipmutt, you're going to have to buy into his vague thesis that Oanda has some magical mathematical way of making you pay more than their quoted spread, no matter what you do.

It's because they can 'predict the direction of the market' and 'smooth quotes' that makes it so you're actually tricked into paying more than the spread they are quoting.

I'm saying this is just a load of hooey. There is no way that Oanda can predict the direction of the market .. on a CONTINUAL and CONSTANT basis, which they would have to do in order to make this magical spreadening alg work all the time.

If they could reliably predict the direction of the market, then yes, I agree whole heartedly with pipmutt, they could *definitely* make it so you're paying more spread by simply quoting above/below the market as they see fit (though 5 pips is a helluva lot). But there is no way they can do that. That would be like having a crystal ball into forex. Gimme a break!

Also, btw, scalping with tight limit orders that allow minimal slippage is pretty easy to do and is in fact the only way I scalp.
  • #856
  • Jun 10, 2009 4:21am Jun 10, 2009 4:21am
Quoting blazespinnaker
No Xaron, if you're going to agree with pipmutt, you're going to have to buy into his vague thesis that Oanda has some magical mathematical way of making you pay more than their quoted spread, no matter what you do.
It depends on the way Oanda hedges its net exposure. I think first they just put all clients positions together in one big pool. Great for Oanda because all clients pay the spread where Oanda doesn't pay anything. Then Oanda will hedge the net outcome in the interbank market.

At least the real spread will be actually a bit higher than those 0.9 pips. The reason behind this is just latency.

Example: Let's assume a spread of 1.0 for simplicity and let us ignore the pool of clients. The bid/ask is 1.4000/1.4001, so you can go long at 1.4001. You just enter your market order and Oanda (or any other market maker!) get this order from you. Now comes the latency into play. Oanda wants to hedge this trade as Oanda is a reliable MM and doesn't trade against his clients. But of course they could delay that order a bit. They know the order book and might be able to predict the moves within milliseconds. Even within milliseconds the price fluctuates a bit. It might go down to 1.39995/1.40005 and Oanda just hedges your long at 1.4001 with its own order at 1.40005. That way they've earned already 0.5 pips spread + the 1.0 pips they usually offer. For you as a trader this doesn't make a difference.

You might ask what happens if the price goes up to 1.4002 instead of going down offering Oanda a better price? Well in that case slippage kicks in, they hedge your order at 1.4002 and give you the same quote as entry.

That's the reason I'd avoid scalping with a market maker even though Oanda is one of the best out there...
  • #857
  • Jun 10, 2009 4:46am Jun 10, 2009 4:46am
Quoting Xaron
pipmutt at least this isn't true for limit orders at Oanda (beside the rare slippage there).

But I understand what you mean. This would only affect scalpers using market orders and I agree, scalping with a market maker is not that a smart idea.
Mornin' Xaron!

Not just scalpers, real scalping (as opposed to just short-term trading) has it's own inherent problems for these shops as they often have difficulty hedging risk quick enough so naturally they dissuade scalpers.

I think you're right up to a point, this more affects market orders than pending orders, but not exclusively. Suppressing and smoothing quotes, skewing quotes, having a directional bias according to their book, the underlying market, and momentum, price shading, artificial spikes to provide in-house liquidity, they're all specifically designed to disadvantage the trader for the shop's benefit. That makes trading with these shops even less of a level playing field, you're not only having to try to analyse and navigate the market successfully (not an easy job on it's own!), you're also having to try and outsmart or at least neutralize the bucketshop's tricks.

These types of quote manipulation don't exist on a true ECN (and I emphasize 'true', there seem to be a lot of bucketshops masquerading as ECN's nowadays). Price feeds are unadulterated, they are a true representation of the underlying market in which trades are executed. As you know yourself, anyone who is counterparty to your trade has a vested interest in seeing you lose, naturally. That's not to say manipulation doesn't exist in the real market, far from it, stop running, candle painting, breaking of significant support/resistance levels and options barriers, they're all part of everyday business for players, but by taking the manipulative bucketshop out of the equation it certainly levels things up a bit.

I imagine this is all stuff you know already (or if it isn't it certainly hasn't affected your trading!), I'm only posting it here to counteract some of the less-informed posts from others.
  • #858
  • Jun 10, 2009 4:55am Jun 10, 2009 4:55am
Actually, I'll have to give pipmutt credit for one thing. While I think it's sheer absurdity to imagine that Oanda can predict the market on a continual basis, I can imagine Oanda profiling traders and using that data against them. This is assuming that the current traders online are correlating enough for them to be traded against, though.

But to the tune of 5 pips? Bahaha.
  • #859
  • Jun 10, 2009 5:16am Jun 10, 2009 5:16am
Quoting blazespinnaker
There is no way that Oanda can predict the direction of the market .. on a CONTINUAL and CONSTANT basis, which they would have to do in order to make this magical spreadening alg work all the time.
OMG, this is beyond pathetic now....please read and at least try to understand. If you can't then fine, but at least exercise a bit of restraint, you're making yourself look like a complete arse!

Suppressing and smoothing quotes, skewing quotes, having a directional bias according to their book, the underlying market, and momentum, price shading, artificial spikes to provide in-house liquidity, they're all specifically designed to disadvantage the trader for the shop's benefit.

That's why transaction costs are higher than the advertised spread, geddit? No, probably not.....sigh....never mind.
  • #860
  • Jun 10, 2009 9:54am Jun 10, 2009 9:54am
You know, perhaps if you stopped with the Ad hominem attacks I probably wouldn't spend so much time pin pointing the obvious errors in your statements. I think I take such a perverse pleasure in doing it because you are so amazingly rude.
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