hi, been trading / scalping on news with acm (refco) for a year and only hitting problems now, size-related i understand. clipping around gbp20mio, which is too much for them on the news, to 'summarize' things nicely. am therefore now live testing fxcmpro/currenex and hotspotfxi (in talks with rbos, ubs for prime broker type relationships), also on demo with refcofxpro/currenex, fxall and more classically saxo... i keep reading great things about oanda for scalping and big size, but i can't work with slippage, which seems to be unavoidable with them (looking from their api). also been reading a lot about ib of course. i know there's no perfect one-size-fits-all platform for what i am doing, therefore planning to use 2 at least, 1 ECN and perhaps keep acm or go for saxo (for the fixed spreads) or yet another ECN as a back-up (on quotes, downtime etc). am sure some of you on this forum have already 'been there'. over the last couple of weeks i've been giving myself serious migraines with all these options and live testing etc, therefore wld be very grateful for any inputs as to what you guys know from your personal experience what the best options would be. many thanks in advance
Why screw around with a broker? Go direct to UBS, if you like them or another large bank. I'd look at Goldman and Lehman as well. But they're also not there to hand you money, so, if you nail them once too often, your spreads will widen.
Why use a fx dealer at all? Given your resources in capital and experience, why wouldn't you opt for futures? By the way, last year, with some others, I opened a "size" account with Saxo Bank, using the Saxo Trader, and promptly had my profitable limit honors dishonored three times. That happened in the second week, after a profitable first week. In each case, the price of the limit order was breached with room to spare. We confirmed the breaching prices on Saxo's own charts, the charts of its white label partners, and by other sources, then gave Saxo a week to honor the trades. No luck. We then asked the Danish gov't agency Saxo holds out as its regulator if other Saxo customers complained about the same or similar problems and learned by reply from that agency that it does not provide any information, including to Saxo's own customers, about Saxo.
Never had problems with Saxo honoring stops, but I don't doubt your experience. I have known ppl who had problems with their BO and haircut on large option positions. I would avoid Saxo. If you're trading 20mil clips you should be trading CME or FX through UBS.
Regarding the last two posters' suggestions to consider trading CME currency futures instead... Given the OP's stated trading size (20mio) and currency (pound), the liquidity is simply not there in futures, period. Not even remotely close, unfortunately. Even a quarter of that size would be too much for the CME to handle, for cable, most of the time. More generally, that liquidity limitation still holds true if you want to be able to trade: - anything other than euro; - and/or at any time other than the US morning session, 7:20 - 11ish CT.
Are you saying an all-or-none bid that size in cable (or Yen, Aussie, Swiss, or CAD) would prop the futures price, i.e., hold it up, or that you would not get the fill because of the size (not the price)? How can you know without the order being there? The actual order book produces the numbers of contracts traded. Or have you had an order that type and size not trade for lack of takers? (I wouldn't know myself.)
broker vs bank: 1% vs 3% leverage (simplifying a bit). also understand that banks r not keen to facilitate hi-volume scalping on news (thats 80% of my p/l). acm for instance clears via ubs essentially (also deutsche recently...), understand ubs doesn't like what i do, did nail them unintentionally a few times, hence the problems i've experienced recently (spreads up to 20pips away from mkt until i close my pozzie...ouch!). not sure about saxo altho' am aware of c.hood's 'mesaventure' with them (i don't 'rely' on system stops but still, i know there r loads of funny things that can happen when things go very wrong for your market-maker...) ECN-type offerings seem more open so far, and they all offer 1-2 click ESP trading no requotes etc. thinking is i'd be trading 'guaranteed' fills and 'fixed' spreads against the 'assurance' that i am done 'anonymously' and at prevailing mkt rates, in and out, which even if i am filled partially is preferable to getting on the wrong side of my mkt-maker who can then pretty much quote me what he wants, or turn down my business... to be clear, i don't solely trade figures, but i am not planning to stop trading them either... therefore need to work with 1-2 good mkt access providers, be they an ECN, bank or broker...
agree liquidity on news is the real issue (for me). i haven't really looked at CME futures yet, and how they move on news, but on the spot, i am told usually cable comes in 5-10mio chunks, eur in 20-30, and once an order has been filled, the liq. providers immediately submit a replacement bid/offer for an equivalent quantity, therefore ensuring a gbp20mio order cld be filled within less than a minute, even on news. true or false, i am about to find out... but any inputs from s.o. who has tried it most welcome indeed!
2cents - From your comments, I doubt you trade at all. Heres why - anyone with capital that size, and asking for advice here about trading it, is a fool and would never have accumulated dough like that. If you have 20 mil in capital, its simply silly to trade with 3rd rate banks. Go to Tier 1 banks. You're talking about being able to swing 9-figure size trades, which of course no one is keen to qoute on around numbers. If you have 1-2 mil, and are trying to leverage it into 20, you getting wiped out is where banks have concern. Tier 1 banks routinely trade 5-10 mil positions with customers at 2-3 pip spreads - no big deal. If I were you, I'd go talk to some Tier 1 banks about your trading needs and see what they say.
well i do, but you're correct that i only have in the region of $1mio (part my cash, part my clients' monies). already approched rbos & ubs but 1) am too small, 2) not clear to me that they wld be happy to let me trade as aggressively on news, plus they can only provide 3% lev vs 0.5-1% via a broker 3) understandably they prefer to deal with 'institutions', funds etc. and you're also correct that i use a rather high leverage on news, but thats over v.short timeframes, had a few accidents of course, but i'm still here... reason i come to this forum is 1) moneytec aside i dunno where else to go to get advice on the issues i am grappling with right now, plse let me know if you know of another more suitable forum 2) i was comfy with my set-up with acm but i have now clearly hit some limits with them, therefore need to switch to a different set-up where i am less likely to hit the same sort of limits 3) am hopeful that there may be at least a few people with a similar 'transitional' experience who wld be kind enough to share... am currently live testing & / or demoing the platforms / services mentioned earlier in this thread as stated, but i'd be happy with any inputs that wld help me shorten my learning curve here, to the extent possible...