On the size you're asking about, a half-million dollar USD account could double or blow up in the time it takes to read this post. (A one & half percent move in USD would do it, which, while rare, is not too rare to ignore around news.) How is a retail fx dealer going to honestly fade such an order? It won't, not for that stake. So, at best, it'd shop the order in the cash (not margin) market, where quotes fragile at news would be wider and widening. The best I suppose you could hope for is a quote marked up from that tough starting point. You'd then be paying 1000s (thousands) of dollars in commission (the marked up spread). And that scenario doesn't begin to weigh the risks (counterparty and other) of betting such sums with a retail dealer which, after all, controls the price & fill and any subsequent run at your stop.
If I were you, I'd make sure all my docs are in order, esp with customer money, and go see JPM, GS, Lehman and even Bear Stearns. Tell them what you're trying to do, and if they wont do it, they'll refer you to someone who will. I'd even try Man and see what they say. Keep in mind, that if you're just going to try and pick off dealers to make money, your a/c wont be welcome for long anywhere. Nobody likes being taken advantage of.
chris - yes in theory, but in practice there is reasonably little chance the acct will blow up if i am monitoring actively, which i am. as for retail 'brokers', the ones i've been using (acm mostly, also gain/forex.com) also try &/or do already cater to institutional size type investors, therefore assume they r equiped to fill big orders even in fast mkts, via their usual liquidity provider(s), fxall, currenex or internally-sourced liquidity / prop books. since it seems to be my best/only option, i've started (this week) monitoring currenex & hotspotfxi live spreads & liquidity. encouraging so far, e.g. spreads didn't widen and liq. remained 'constant' on cable & eurgbp around today's UK GDP figures (agree there was no surprise but my 'retail' broker acm opened the spread 20 pips on cable for 45 seconds for instance), but of course i need to keep monitoring for much longer than a few days... tomcole - thanks, forgot MAN as a (relatively recent) option, worth a try. (fyi i've tried statestreet/globallink/fxconnect but they say they don't offer ESP at this stage, hope MAN's set up will be better!). as for GS, LB etc, i am too small, maybe BStearns...? but again, you're correct that most bank dealers won't like what i do (until they figure out a way to 'handle' it)... therefore kinda seems that the ECNs route might be my best bet for now?
of course, and that's not what i am trying to do, but i do want to be able to trade the mkt, for the size i need, and when its moving fast.... i might be naive here but to me, no matter how difficult it might be in fast markets, its the dealer's job / decision to 'adjust' his spreads, quotes & quantities on the bid/offer or to not quote according to mkt conditions, and its my decision to trade or not on that basis. if occasionally the dealer gets burned, well i'm sorry, but thats part of the game isn't it?
I dont think what you're doing is a big deal for a bank. Banks routinely qoute customers 50-100 mil deals, so you're not even a minnow for them. Maybe go get Institutional Investor or a similar magazine and see the list of major/minor players in FX and go see them. Of course its the dealers job to qoute, but if you want to be a professional customer, leaving something on the table regularly will yield higher returns than anything else. When Ive had room, I always tell them to adjust a little so their spread is bigger. You need to spend a few days visiting NY and see what you can come up with. But if your deal is to pick off banks, you're only fooling yourself about how long they'll let you take money from their pockets. I've used Stop Limit orders to trade around numbers and have found myself getting filled on both sides in milliseconds sometimes, but its a lottery ticket. Sometimes you win, sometimes you lose.
not a big deal at all normally, except i want that on no requote 1-2click ESP, not RFQ, no dealer intervention... need to play more with currenex & similar multi-dealer platforms but it does seem i cld get a VWAP-basis type fill for those sort of quantities within less than a minute even in v.fast mkts on those platforms... now at what average price etc, i have yet to find out... understand yr point re dealers not liking to lose money, which i do find funny to be honest, but that seems to imply that ECNs are the best option then, doesn't it? or do you have a view on ECNs?
'professional' customer?? mmmhhh, no you see, i pretty much intend to be just a customer here, and to work with the institutions who want to be 'professional' service providers instead. but that aside, agree in principle, i don't mind leaving a few pips on the table when i believe its justified by extraordinary service
don't wanna appear harsh here... but honestly NO bank dealer will welcome that kind of trading around the news, it doesnt matter what size the bank is. Noone wants to be the sucker.
agree misha7 but hey, nobody's obliging a dealer to quote during news if not the competitive pressure. if a quote (for a given qty) is available on the mkt i'm not asking for any favours, i just want to be able to hit it, period. if that dealer gets burned as a result, well too bad, i get burned too sometimes, and i don't complain to the dealers or anybody else. now i also know that an unhappy dealer can & will try to screw me big time (on the exit), simply because he can...sad but human...whereas if i were another big instit. hitting his prices he wldn't even try, for obvious reasons...and same if i were hitting him via a big instist.'s ECN offering i wld think, therefore my recent interest in them, seems its a more level playing field, but those r v.early days for me here...any inputs mucho appreciated as always! see what bothers me is i am reading too many posts showing a lot of understanding for what to me is essentially a lot of average wanabee dealers and bankers who quote even when they can't take the hit, get hit and then blame it / take it out on the traders / scalpers etc. they're just as pathetic as a trader blaming his losses on whatever really...honestly, with all of today's technology, if a particular dealer can't profitably make a market in a fast market set-up, then maybe he shld consider staying out, there r other reasonably secure and high-paying jobs around (like, making a mkt when the mkt's slow )) ) and its not like there is a dearth of proficient dealers anyway, don't u think?...
How have you got on? Are you serious about it taking a minute to fill an order -surely that is unacceptable?