1. This site uses cookies. By continuing to use this site, you are agreeing to our use of cookies. Learn More.

Alpari UK and Spreads

Discussion in 'Scam Alerts' started by tadinda, Sep 21, 2011.

  1. tadinda

    tadinda Private, 1st Class

    Joined:
    Oct 3, 2007
    Messages:
    65
    Likes Received:
    0
    Alpari UK and Spreads


    I do believe that this is a SCAM of ongoing proportions. However I stand to be corrected.

    It all started when a good friend of mine suggested that Alpari UK is charging spread at both ends of a transaction. A transaction by my definition is a Buy and Sell of the same currency pair. Or the Sell and Buy of the same currency pair. So I decided to contact Alpari UK Customer Services.

    Hereunder is the transcript of all the emails exchanged this Wednesday morning the 21 September 2011. What is being omitted is the names of the individuals who answered and my account number which has to be the “subject” in any e mail correspondence. I have also omitted all the “To” and “From ”fields” and their numerous disclaimers.

    To summarise. Apari UK advertise their spread amounts on their website. However what they do not say is that this spread is being charged (or inflated or deflated within the price) on both ends of the transaction. That is on every buy and on every sell of the same transaction of the same currency pair.

    This is what I have deduced from their replies or lack thereof. This is the reason I am attaching the full correspondence so that we all traders may have a discussion over this and decide our next steps.

    Concurrently with this exchange with Alpari UK, I entered into a live web chat with Deltastoch Customer Services. This is also attached for your study and consideration.

    I do wish to receive your comments on this.



    The Emails


    Hi,

    A friend of mine is suggesting that you are charging spread on both sides of a transaction.

    Meaning. If I buy GBPUSD you are making 3 pips out of my buy Trade. Then when I come to close this same trade you are also making another 3 pips. This effectively makes it a profit to you of 6 pips on my transaction.

    Can you please confirm if this is the case. Because as far as I know it you should only be taking your 3 pips on either the buy or the sell of the same transaction.

    Look forward to hearing from you.

    Regards

    EC

    ------------------------------------------------------------------------------------------------------------------------------------------


    Dear Sir,

    Thank you for your email.

    Please let me inform you that your friend is mistaken.

    The spread is already included in the prices quoted on your platform as is not added to either the entry or exit price of any transaction.

    Micro and Classic accounts are charged a minimum spread of 1.6 pips. Spreads vary depending on the currency pair traded and these can be easily accessed from the following link: Trading Accounts - Contract Specifications - Alpari (UK)

    Additionally, please note that spreads would apply differently depending on your region of residence (but they would still be included in the quoted price on the platform).

    Please also be aware that Alpari (UK) offers flexible spreads which means that we simply mirror the prices quoted on the markets.
    During certain times of the day, periods of lower liquidity and when there is increased market volatility, spreads will naturally widen.



    Kind Regards

    (Name of Individual deleted)
    Client Services Representative

    ------------------------------------------------------------------------------------------------------------------------------------------

    Dear “Name Deleted”,

    Thank you for your response.

    However the crucial question has remained unanswered.

    Is the spread being paid on both sides of the transaction. That is on entry and exit. Or just on entry OR on exit.

    Regards
    EC



    Dear Sir

    Thank you for your email.

    You can only buy at our Offer price, or sell at our Bid price, whether you are entering or exiting a trade.
    This is the usual market convention.

    Kind regards
    Team Leader, Client Services



    Dear “Name Deleted”,

    Once again thank you for your reply.
    However I am still without an answer to my very simple question. Which I repeat here:
    Do we as traders pay spread at both ends of the transaction. Meaning for example if the spread on GBP USD is 3 pips, I pay three pips when buying a lot of GBP USD and another 3 pips when selling the same lot size of GBP USD.
    Please reply without any further beating around the bush.
    Thank you.
    Regards
    EC



    Dear Sir
    Thank you for your email.
    No – you do not pay any premium – I do not know how I can make this any clearer.
    You can only buy at our offer or sell at our bid.
    Were you hoping for it to be the other way round ?
    Kind regards
    Team Leader, Client Services




    Dear “Name Deleted”,

    No.
    Let us make my question more graphic so that we will avoid the use of a variety of words. Let us assume your spread is 3 pips.
    So I buy GBP USD at 103.
    Price goes up to 153 and I sell at 153.
    I decide to sell this same GBP USD. Close the whole transaction.
    So questions:
    1. Have I incurred 3 pips in Spread as total Spread for both the Buy and the Sell?
    OR
    2. Have I incurred 6 pips in Spread as Total Spread for both the Buy and the Sell?
    Which is the correct answer please.
    Regards
    EC



    Dear Sir

    Thank you for your email.

    How do you buy at 103 ?
    What is the spread at this point ?
    If you sell at 153 what is the spread there ?

    If we assume 3 pips, then when you buy the price might be 100/103 and when you sell 153/156.
    So there is no additional premium to pay.

    If you buy at 103 and sell at 153 profit is 50 (+/- any swap costs but let’s assume you close it same day and avoid that).

    Does this help ?

    Kind regards

    Team Leader, Client Services




    Dear Sir

    Thank you for your email.

    No – you do not pay any premium – I do not know how I can make this any clearer.
    You can only buy at our offer or sell at our bid.
    Were you hoping for it to be the other way round ?

    Kind regards

    Team Leader, Client Services




    No.

    This is getting out of hand. And I am afraid to say that your beating around the bush to answer this means only one thing which you do not want to say. So I ask again.

    When I buy and sell a pair, in the same day, do you as Alpari make 3 pips on the Buy and 3 pips on the sell? Assuming that the Spread is 3 pips.

    Have tried to make this as easy for you to answer as possible. So far have not had a decent answer.

    Regards
    EC





    Dear Sir

    Thank you for your email.

    There is no beating around the bush.
    This is one of the most elementary and universal truths in FX.
    The spread is merely the difference between the Bid and the Offer.

    Everyone who deal on someone else’s price has to trade this way.
    And I do mean everyone.

    The answer as to whether we make a profit equivalent to the spread is an entirely different question and is entirely dependent on whether someone else happens to buy from us at the same time, and in at least the same quantity.

    If this is still causing you concern perhaps we should come at this a different way – can you tell me what you understand this term to mean ?


    Kind regards

    Team Leader, Client Services




    Well I have just asked another broker these same question. The chat is being copied hereunder. The question was simple as was his answer.

    Here it is.

    tadinda> let us say GBP USD spread is 4 pips
    Dealer> ok
    tadinda> when I buy the pair Deltastoch makes nothing
    tadinda> However when I sell the pair Deltastoch makes 4 pips
    Dealer> That is correct.
    tadinda> so in any one transaction (a buy and sell of The same pair) then Detastoch only makes the spread once and not twice
    tadinda> hope I am correct this time round
    Dealer> Yes, that is also correct
    tadinda> Fantastic
    tadinda> Thank you so very very much for your honestly and integrity. Other brokers just play with words.


    It would appear that Alpari do not operate that way.

    Regards
    EC





    Dear Sir

    Thank you for your email.

    The question, and answer, belies a lack of understanding from both of you.
    However I wish you good fortune with your broker of choice.

    Kind regards

    Team Leader, Client Services






    Dear Sir,

    Thank you for your e mail.

    I shall be posting this whole discussion on Free Forex Trading Community With Forex Signals And Broker Reviews and we will all have discussion on it and then decide what the next steps will be.

    In the meantime thank you for your patience and answers. or lack thereof, to my questions.

    regards
    EC



    Dear Sir

    Thank you for your email.

    Please ensure that the usual courtesies of anonymity are observed.

    Kind regards

    Team Leader, Client Services




    Dear Sir,

    Do you mean I should avoid using the name of the Company Alpari, or your name as the agent?

    regards
    EC




    Dear Sir

    Thank you for your email.

    It is not considered acceptable practice to identify individuals by name for what I hope would be obvious reasons .
    The company, by all means.

    Kind regards

    Team Leader, Client Services




    Dear Sir,

    Thank you. At forexpeacearmy.com we do not target individuals at all. When we relate stories we refer to individuals as to the post they hold. However, the company is by necessity always mentioned so that traders like myself are fully aware of what brokers are up to or may be up to.

    Regards
    EC




    Dear Sir

    Thank you for your email.

    Sadly, that has not always been my experience with FPA.

    Kind regards

    Team Leader, Client Services
     
  2. Albert.b

    Albert.b Sergeant

    Joined:
    Jan 7, 2011
    Messages:
    154
    Likes Received:
    0
    Tadinda, obviously your questions are a bit too complicated for a straight answer!

    I will now put it in a simpler form to Alpari UK!

    If a client opens and closes a trade in the same trading day and the spread remained unchanged at 3 pips ALL DAY, would the client pay Alpari UK, 3 pips or 6 pips?

    To make it real easy for us to understand, please just answer 3 if your clients are charged 3 pips, or 6 if they are charged 6 pips, on a single open/closed trade.
     
  3. athenafx

    athenafx AthenaFx Representative

    Joined:
    Jan 30, 2011
    Messages:
    171
    Likes Received:
    1
    Tadinda you should think about the way it works with a bank or a good broker.

    May be you use MT4 and you can open and close a position with the same order but you may consider that when using other platforms, you need 2 transactions to open and close a position.

    Most of the time the bank/broker has many liquidity providers and they compete to offer the best price.

    Let's say that you want to sell 1 lot EURUSD, you receive the best bid at 1.35941 then your broker adds its mark-up (for example 0.3 pips if you deal with a good broker) then your order is filled at 1.35944. The same will happen when you want to exit at ask. I mean that your bank/broker will offer you the best available price including the mark-up. After all, your bank/broker may have made $6 for your 2 transactions.

    You may understand that it is not pure profit because they have to pay the technology and the prime broker.

    You may also notice that you can start an order with a liquidity provider then close it with another one.

    After all, you bank/broker has received a fair fee. There is nothing to complain about.

    Would you prefer a bucket shop that will guarantee a supposed 0.1 pip with no commission + bonus and bla bla ... ? However they will charge you many pips and your order will not even be on the real market, just a video game.
     
  4. tadinda

    tadinda Private, 1st Class

    Joined:
    Oct 3, 2007
    Messages:
    65
    Likes Received:
    0
    Alpari UK Spreads


    Thank you for your input.

    If only they so on their website. Or even answer a simple question with a simple answer. You would expect nothing less from anybody unless they have something to hide.

    The correspondence quoted in my first post above says it all.
     
  5. tadinda

    tadinda Private, 1st Class

    Joined:
    Oct 3, 2007
    Messages:
    65
    Likes Received:
    0
    Alpari UK Spreads

    Thank you for your input.

    An very intelligent question eloquently put.

    I am certain if I submit this question to Alpari UK I will get all sorts of other ......................
     
  6. Pharaoh

    Pharaoh Colonel

    Joined:
    Oct 3, 2007
    Messages:
    19,658
    Likes Received:
    2,205
    Simplify the question further. If spreads remain at 3 all day and you close when the price returns to the level where you originally entered, would you find yourself 3 pips or 6 pips short?
     
  7. Albert.b

    Albert.b Sergeant

    Joined:
    Jan 7, 2011
    Messages:
    154
    Likes Received:
    0
    Why such a complicated answer?

    ALL TADINDA WANTS TO KNOW FROM ALPARI UK IS, DO THEY TAKE 3 PIPS OR DO THEY TAKE 6 PIPS?

    ALPARI UK, NO 'DUCKING AND DIVING', JUST PLEASE KEEP YOUR ANSWER NICE AND SIMPLE!

    SURELY YOU ARE NOT SCARED TO REVEAL THE TRUTH TO THE FOREX WORLD!
     
  8. athenafx

    athenafx AthenaFx Representative

    Joined:
    Jan 30, 2011
    Messages:
    171
    Likes Received:
    1
    Albert

    1/ Stop shouting please

    2/ I am not the Alapari representative

    You may ask them to publish their dealing model. Some brokers are transparent, others are not.

    The title of the poll is quite irrelevant "Should Traders be charged Spread at both ends of the same Transaction".

    Many traders only see the market thru their metatrader. If you change their platform so that they have to place orders as below, may be they will have a better understanding.

    Example :

    1/ SELL x S&P 500 at market, to Open.
    2/ As a stop, BUY x S&P 500 at zzzzz.zz, to Close. GTC.
     
    #8 athenafx, Sep 22, 2011
    Last edited: Sep 22, 2011
  9. Albert.b

    Albert.b Sergeant

    Joined:
    Jan 7, 2011
    Messages:
    154
    Likes Received:
    0
    1. I never said you were the rep of Alpari UK! and I am not addressing you in that context, only that your post was a typical broker's answer (complicated) to a simple question!

    2. If you re-read my post, you should see I am shouting (caps in red) at Alpari UK to give a simple answer to tadinda's original question!
     
    #9 Albert.b, Sep 22, 2011
    Last edited: Sep 22, 2011
  10. Pharaoh

    Pharaoh Colonel

    Joined:
    Oct 3, 2007
    Messages:
    19,658
    Likes Received:
    2,205
    I would love to see Alpari's direct answer, but don't have time to play with their chat or email reps.

    I did open a demo account and opened and closed several trades very quickly. Looks like the spread only hit me on one side.
     

Share This Page