Can we build a better broker?

[Damon]

Pharoah

Hey Pharoah,

The reason I am leaning toward BT as my liquidity provider is that per contracts they have with the banks and Prime brokers the orders are automatically filled, period. The banks and prime brokers are willing to this because they are attempting to be flat the market (trades on both sides so they are essentially risk free), while I as a smaller broker am using them to take on my risk (I do not fill the clients trade like an MM, the banks and prime brokers do). So I am flat and they are attempting to be flat. It is a win win in my opinion.

BT is different from other ECN's like Integral in that Integral is attempting to find someone else for the deal, they are attempting to make the market, I like the idea but with these types of ECN's you see more trades not being filled and requoted as it needs to be checked and sent back, where as BT is just fill at best price, so it is faster with less requotes.

BT's liquidity allows STP ECN trading as fast as you like, any trade any size any speed, and we are getting the best price fill from 1 of 25 institutions. This is exactly what I was looking for.

As for slippage BT comes with software that tracks it, I need to follow it to make sure that slippage happens evenly (Or I'll *****), I can post the results on my webpage. Some brokers actually enforce slippage against the trader I will not even install that plugin.

Does anyone know if there is anything I can do from inside my MT4 to check brokerage settings?

If there is I would like to be able to tell my clients how to check and make sure the settings are as I say.

Damon

 

[f-man]

The reason I want to go unregulated is that more and more regulators are accepting CFTC's rules, this is uncomfortable to me. The whole purpose of this discussion is to see if it is possible to somehow devise a way that makes the brokerage transparent. Although there is a few regutors that I like, I am not excited to go through their hoops just to have them take on CFTC's rules.

You mentioned that there are some regulators that you like. Which ones do you have in mind?

 

[David111]

Hi all,

There are many good brokers out there but we have no good EA/system/managed accounts/signal service.

Thought, before building a good broker we should find out a good EA/system/managed accounts/signal service. We'll have a good profits if we have this.

Can FPA/Pharaoh/F-Man or any one help us?

Thanks inadvance.

David

 

[jpadventure]

Regulation to me means; an independent body, who will fight your case on your behalf if it becomes necessary.

Don't have to use the normal guys to have that option.

There are at least two brokers who claim they are "for the people". Seems like a marketing thing, but time will tell. I hope you get setup.

 

[Normbell]

I guess we have different needs and requirements from our Broker.

I personally would not be interested in an EA/system/managed accounts/signal service.

What is important to me is a level playing field where the Live platfrom is set up the same as the Demo platform so that if we are profitable on Demo we should not have the extra worry that different settings can be used to reduce or skim those profits.

Also that we are confident that withdrawing funds is not going to be a jumping through hoops exercise.

hissst, I like your idea of transparency and letting us check the MT4 Broker settings so there is no doubt of shadyness (don't think this is possible though).

 

[Damon]

There are many good brokers out there?

David:

please tell me which brokers are good in your estimation, maybe I don't need to set up mine if you have found many. In my searches I have not.

As for EAs/Managed/Signals and what not FPA is a good place to find out that commercial EAs on the whole don't work out. EAs that are sold is red flag to me, it should be leased or in a managed account if the creator thinks it is worth a grain of salt. My current business is promoting managed accounts that actually make you money, I am not going to promote my service through this thread, but managed accounts are the way to go in my opinion, the manager is only paid if he makes you money, Managed Accounts is where the good EA's go.

There is also more and more hedge funds that are forex based but they fee you to death like regular hedge funds, fees not based on production is another red flag in my opinion but you will see the HUGE money in these hedge funds because people with credentials put other peoples money (dumb money) in the fund to receive a commission... booo, it's disgusting!

Signals are hard because there is SO MANY variables that turn good signals bad. If I find a good signal I ask him to create managed account, if it looks sexy after 3 months I will invest. Usually he will not look good, signals are sold by how many pips they generate, usually they are avoiding the fact that they were 1000 pips open-trade-draw-down to get 200 pips closed trade profit... because of the way signals are marketed they can get away with not displaying open-trade-draw-down, not the case in a managed account.

I want mention here that ZuluTrade claims to have great signal providers, maybe, but I have found none, they pay the signal provider a portion of the spread, that means they (like the brokerage) are paid to churn, it is inherently flawed, if a manager is paid to make profits and makes no money other wise than he is not inclined to churn and burn, so managed accounts are a "win" for the manager (they MUST make money for the client to be rewarded), "win" for the broker (in the long run -client retention) and a "win" for the investor.

My brokerage will have many good managers, I will have BTs PAMM plugin and I have quite a few good managers as friends so I can guilt trip them into running accounts at my brokerage

Normbell:

It is difficult to set up the demo exactly like the main brokerage, in the beginning it is ok, but demo accounts fill up very fast and the servers are not scaled up because it is looked at as a waste of money, they focus heavily on scaling up the REAL server (good). My idea is that I will have a 1 week demo account available, this will force out the guys running tons of eas and just letting it run forever. there is another inherent problem with demos though, they do not route trades the way a REAL account routes, it just fills the trade willy nilly. This not a good way to test an account in my opinion. I will be offering standard accounts that trade as small as micro lots so it will not cost much to do a proper test of the brokerage, I wish BT supported nano lots but it does not.

JpAdventure:
The other two brokers that claim they are for the people are just marketing, you are correct, they have hybrids and run them as suggested.

F-man:
The other regulatory bodies that I like are ones that no else likes... lol, RUSSIAN Regulations!! who cares... I do. But I am the only one That is why I think User Regulation is the way to go. I need to find out about 3rd party insurance on funds, that is my next hurdle, I want the clients insured against catastrophe AND to be unregulated, it's probably a tall order but I am looking into it.

Rahman:

Ok, video = not enough.

Segregated accounts makes it so you have to apply for an exclusive club, you are applying to the bank, not me. FXprimus is simple because they do not offer the segregation themselves.

And of course regulations is the other factor for the 25 page application form.


Update:

I making progress with BT, it seems I can have all settings at the brokerage published to a real time data base that I can display on a web page, USER REGULATED here I come!

The down side is that I will be charged for them to create that plugin, but it will be worth it.

So now the question is... does anyone care?

 

[David111]

David:

please tell me which brokers are good in your estimation, maybe I don't need to set up mine if you have found many. In my searches I have not.

As for EAs/Managed/Signals and what not FPA is a good place to find out that commercial EAs on the whole don't work out. EAs that are sold is red flag to me, it should be leased or in a managed account if the creator thinks it is worth a grain of salt. My current business is promoting managed accounts that actually make you money, I am not going to promote my service through this thread, but managed accounts are the way to go in my opinion, the manager is only paid if he makes you money, Managed Accounts is where the good EA's go.

There is also more and more hedge funds that are forex based but they fee you to death like regular hedge funds, fees not based on production is another red flag in my opinion but you will see the HUGE money in these hedge funds because people with credentials put other peoples money (dumb money) in the fund to receive a commission... booo, it's disgusting!

Signals are hard because there is SO MANY variables that turn good signals bad. If I find a good signal I ask him to create managed account, if it looks sexy after 3 months I will invest. Usually he will not look good, signals are sold by how many pips they generate, usually they are avoiding the fact that they were 1000 pips open-trade-draw-down to get 200 pips closed trade profit... because of the way signals are marketed they can get away with not displaying open-trade-draw-down, not the case in a managed account.

I want mention here that ZuluTrade claims to have great signal providers, maybe, but I have found none, they pay the signal provider a portion of the spread, that means they (like the brokerage) are paid to churn, it is inherently flawed, if a manager is paid to make profits and makes no money other wise than he is not inclined to churn and burn, so managed accounts are a "win" for the manager (they MUST make money for the client to be rewarded), "win" for the broker (in the long run -client retention) and a "win" for the investor.

My brokerage will have many good managers, I will have BTs PAMM plugin and I have quite a few good managers as friends so I can guilt trip them into running accounts at my brokerage

Hi hissst,

ACM, Alpari, Dukascopy, FOREX.com, FXCM , FXDD, GFT , Interactive, OANDA... are good brokers. There are much more...

Which company are you promoting managed accounts?

How do you think of FXDM signal?

Thanks.

 

[Pharaoh]

Let's not get dragged off topic. Obviously, some brokers are better than others. Hissst wants to make a brokerage that's better than anything else out there.

As far as EAs, managed accounts, etc., live forward tests are the way to go. If this new brokerage really permits even the fastest trading, then maybe we can all see which EAs can really stand the test of time.


Assuming this does go through, one big piece of the full transparency puzzle would be publishing the section of the contract with the liquidity provider that covers all conditions and rules regarding the cancellation of trades as well as the reinstatement of trades that may have been closed by a bad tick. As the broker, you'll want to negotiate this very carefully with the liquidity provider or you could find yourself covering trader losses that are the liquidity providers fault. As a trader, I want to know each and every possible circumstance that could lead to my trades being retroactively canceled as well as what my recovery options are for trades that are closed due to bad data.

I realize that you are probably still in the early phases of negotiation with the liquidity providers, so it may not yet be possible to publish that part of the contract. On the other hand, now would be a good time to ask them about when such details can be published.


One other very important question regarding the brokerage - how big of a support staff would be hired to cover it initially? In the event that there's an issue accessing the datafeed (my end or the broker end), I want to be able to call up, check the status of my trades, and either tighten SL or close trades. If you plan to seek clients from around the world, you'll need people who speak a variety of languages. Will there be 24x5.5 phone and live chat? What languages will be supported?

 

[RahmanSL]

hissst, given his vast experiences in forex, I would suggest that you take on board Pharaoh as one of your "special consultant" to go through all the nitty-gritty of starting a Forex Brokerage company which can be trusted by traders and is here for the long haul.

Other "consultants" worth considering are MichelAnge21, Boko Maru, F-man, and even Thedor Jackson. I am sure they have plenty of ideas as to what constitute a "good and trustworthy" broker.

Good luck in setting up your Forex Brokerage company, and you can be sure that I will be among the first to try your company out.

 

[Damon]

Pharoah:

I have scheduled talks with BT on Monday, I will talk to them about this. As for tech support they handle it per their contract but I will find out the nitty gritty details.

Rahman:

Yes, that is why I am going about the brokerage in this fashion, I want to make use of Pharoah's and F-man's expertise. Thank you for wishing me luck, it will be nice having someone who knows what I am doing as one of my first clients

GOOD BROKERS:

I want to show you what I mean when I say there is a lack of good brokers, FinFX is widely known for being AWESOME or for their marketing... let me show you https://www.finfx.fi/index.php?lang=eng If you read the hype on the main page, you would think I wouldn't need to create my own brokerage. Now read this https://www.finfx.fi/index.php?page=trading-accounts&lang=eng

Notice they promote all the good features from each type of account, this in my opinion is false advertising but they are not lying -just failing to mention that these conditions are not met in the same account LOL!, I will not offer a hybrid and bet against you if you are small, you are in STP or not in my brokerage, period.