By the sounds of everything on fpa and reviews I have come to my own conclusion.
How do brokers make money?
1: By you, the retail trader losing money.
2: By falsely claiming to be ECN/STP providers to suck clients in that end up losing because they can manipulate things ensuring they are profitable at your expense.
3: By providing 1:500 leverage knowing most clients will blow accounts up, thus generating money. Professional institutional traders dont trade more than 1-2 standard lots per $100,000 capital, thus trade unleveraged or very minimal. Theres a reason for this. 1:500? lol
4: By hunting stop losses ensuring they earn money off price that for you the trader spiked for an unknown reason.
5: By not paying client profits due to x y z reason. The best one i heard of on here was a user didn't get paid due to trading fake prices. Prices the platform allowed him to click buy/sell on. I mean how stupid do brokers think people are? Theres no button in mt4 that lets you select prices that dont exist lmao.
conclusion:
They earn money by lying, scamming, fraudulent activity, misleading clients and so on to make themselves profitable at your expense.
The funny part is, if you run a pyramid scheme you will be prosecuted and shut down for it. I mean real pyramids (not MLM's). Eg: I call you up, tell you i have a way to teach you how to be a millionaire. I get 100 people on board. You all pay a small signup fee ($100 each). I just earned $10,000.
Now you come to the meeting and i tell you how to do it, you do it by teaching the same i just did and filling up a room.
This is pyramid and illegal.
Yet running a broker firm, manipulating client orders, widening spreads at your own discretion to stop clients out so they lose their capital thus directly profiting off it yourself (which is stealing) and so on that brokers do behind the smoke, lie about the type of provider you are (ecn) when you are actually a market maker and do not connect clients directly to liquidity provider and so on... this is deemed legal and ethical business.
BAH