RESOLVED Case# 2013-098 | Tradetowin vs www.avatrade.com
- Thread starter Tradetowin
- Start date
-
- Tags
- resolved issue avafx avatrade
Prem Kumar Ramamurthi
Sergeant
- Messages
- 149
Still AVA representative is yet to join in this thread...
Till now AVA rep hasn't shown feed of their platform. They were trying to compare with Bloomberg feed.
This arises a question, are they using bloomberg feed?? or else the feed is really from a LP.
Till now AVA rep hasn't shown feed of their platform. They were trying to compare with Bloomberg feed.
This arises a question, are they using bloomberg feed?? or else the feed is really from a LP.
Pharaoh
Brigadier General
- Messages
- 20,308
In the discussion thread in Scam alerts, Ava's representative used a Bloomberg feed to show that one of Tradetowin's entries was different than the Bloomberg price.
I would like to have that representative address whether or not Bloomberg is officially considered to always be the "real" price by AvaTrade.
I would like to have that representative address whether or not Bloomberg is officially considered to always be the "real" price by AvaTrade.
PaulWilliams
AvaTrade Representative
- Messages
- 10
Offical Ava Response
(This reply was initially posted on Monday but wasn't posted)
1.Starting from the first off-market trade, how many trades:
a.Entered at an off-market price?
AvaTrade found 27 trades that the client made across two accounts that were considered arbitrage as the trades were opened at off market prices.
If a trader opens a trade at an off-market price – it gives the trader a ZERO RISK trade opportunity – which is what arbitrage is. This is regardless of how long the trades are kept open for. This is something that the client is arguing. Arbitrage is not based on length of trade; arbitrage is trading on off-market prices that occur through any means which gives the trader the opportunity to make RISK FREE profits.
b. Exited at an off-market price?
There are no positions exited on off-market prices
c. Were on-market for both entry and exit?
This question is not relevant to this case. Arbitrage can occur on both entry and exit of trades.
If the AvaTrade trading practices department found that the client opened any trades (In this case 27 trades) that were at off market prices, they cancel the trades. It is in the AvaTrade T&C’s that the client agreed to that allows AvaTrade to cancel the trades in their entirety.
2. How much money was gained/lost by trades that had an off-market entry or exit?
The client gained $9289.06 through off market trading which was deducted from the client. Details of these trades have been given to the client already. The $9289.06 was made through a total of 27 trades across 2 accounts.
3. If those trades were adjusted, how much money would be gained/lost?
As stated in our previous response to the client on this thread, AvaTrade,
(i) Does not adjust prices on any of our client’s trades if arbitrage is discovered.
(ii) Cancels all illicit trades of any client found to be opening/closing trades at off market prices.
Hence, all trades that were opened outside of the market rates by this client were cancelled by the Trading Practices department and all profits and/or losses on these trades are deducted.
4. How much money was gained/lost by on-market trades??
As we stated previously on this thread, the client gained $2,432.61 by trading at on market prices. AvaTrade does not deduct or cancel trades that were made legitimately. The client was allowed to withdraw this money. Please see below the data of the trades that were not deducted from this client.
Non Deducted Trades
View attachment 11162
5. If a large, clean deviation happened, the price would almost always rocket in one direction. If any trader opened a trade using perfectly legal spike trading software just as that data was coming out, they would have a good chance of getting either slippage or an off-market fill.
Under those circumstances, the off-market fill would almost always be in the trader's favor. This would require no form of arbitrage at all, but the trades would be virtually identical to those that could be triggered by arbitrage software.
How would AvaTrade differentiate this from using arbitrage software?
Successful news trading is opening and closing positions during news to make quick profits from volatile markets at real market prices. Arbitrage is trading on prices that do not actually exist in the market but caused by unfortunate uncommon delays on platform feeds.
Also, using the scenario put to us above regarding the spike and software. Slippage will only occur on the client’s trades if the client has a Stop or Entry Stop placed on orders or open trades. AvaTrade follows the market convention that stop orders are not guaranteed.
6. Suspecting possible arbitrage is a valid reason to examine trades. If (and ONLY if) arbitrage can be PROVEN, then that is a valid reason to cancel trades. Otherwise, trades should only be adjusted to match real market prices.
If Ava's terms define Bloomberg as the "real market" then those are the prices that should be used for this adjustment.
No - this is not the case. It is explicitly stated in AvaTrade’s Terms and Conditions that it is the policy of the company to cancel all illicit trading. AvaTrade does not adjust any client’s trades. The client agreed to the company’s T&C’s when he/she opened the accounts.
Using the argument that other companies adjust their prices is not valid.
(This reply was initially posted on Monday but wasn't posted)
1.Starting from the first off-market trade, how many trades:
a.Entered at an off-market price?
AvaTrade found 27 trades that the client made across two accounts that were considered arbitrage as the trades were opened at off market prices.
If a trader opens a trade at an off-market price – it gives the trader a ZERO RISK trade opportunity – which is what arbitrage is. This is regardless of how long the trades are kept open for. This is something that the client is arguing. Arbitrage is not based on length of trade; arbitrage is trading on off-market prices that occur through any means which gives the trader the opportunity to make RISK FREE profits.
b. Exited at an off-market price?
There are no positions exited on off-market prices
c. Were on-market for both entry and exit?
This question is not relevant to this case. Arbitrage can occur on both entry and exit of trades.
If the AvaTrade trading practices department found that the client opened any trades (In this case 27 trades) that were at off market prices, they cancel the trades. It is in the AvaTrade T&C’s that the client agreed to that allows AvaTrade to cancel the trades in their entirety.
2. How much money was gained/lost by trades that had an off-market entry or exit?
The client gained $9289.06 through off market trading which was deducted from the client. Details of these trades have been given to the client already. The $9289.06 was made through a total of 27 trades across 2 accounts.
3. If those trades were adjusted, how much money would be gained/lost?
As stated in our previous response to the client on this thread, AvaTrade,
(i) Does not adjust prices on any of our client’s trades if arbitrage is discovered.
(ii) Cancels all illicit trades of any client found to be opening/closing trades at off market prices.
Hence, all trades that were opened outside of the market rates by this client were cancelled by the Trading Practices department and all profits and/or losses on these trades are deducted.
4. How much money was gained/lost by on-market trades??
As we stated previously on this thread, the client gained $2,432.61 by trading at on market prices. AvaTrade does not deduct or cancel trades that were made legitimately. The client was allowed to withdraw this money. Please see below the data of the trades that were not deducted from this client.
Non Deducted Trades
View attachment 11162
5. If a large, clean deviation happened, the price would almost always rocket in one direction. If any trader opened a trade using perfectly legal spike trading software just as that data was coming out, they would have a good chance of getting either slippage or an off-market fill.
Under those circumstances, the off-market fill would almost always be in the trader's favor. This would require no form of arbitrage at all, but the trades would be virtually identical to those that could be triggered by arbitrage software.
How would AvaTrade differentiate this from using arbitrage software?
Successful news trading is opening and closing positions during news to make quick profits from volatile markets at real market prices. Arbitrage is trading on prices that do not actually exist in the market but caused by unfortunate uncommon delays on platform feeds.
Also, using the scenario put to us above regarding the spike and software. Slippage will only occur on the client’s trades if the client has a Stop or Entry Stop placed on orders or open trades. AvaTrade follows the market convention that stop orders are not guaranteed.
6. Suspecting possible arbitrage is a valid reason to examine trades. If (and ONLY if) arbitrage can be PROVEN, then that is a valid reason to cancel trades. Otherwise, trades should only be adjusted to match real market prices.
If Ava's terms define Bloomberg as the "real market" then those are the prices that should be used for this adjustment.
No - this is not the case. It is explicitly stated in AvaTrade’s Terms and Conditions that it is the policy of the company to cancel all illicit trading. AvaTrade does not adjust any client’s trades. The client agreed to the company’s T&C’s when he/she opened the accounts.
Using the argument that other companies adjust their prices is not valid.
Prem Kumar Ramamurthi
Sergeant
- Messages
- 149
Dear Paul,
If u mark the trades as illicit or arbitrage. Please provide evidence for the same. Please dont quote Bloomberg data feed.
U have already quoted that 2Lp with whom u have tie up has either stopped their feed or widened their spreads.
If this is the truth, the broker is the sole responsible for loss incurred for already opened trades [those trades turning to be losses]. But u dont take responsibility rather blame LP for the same.
Also u accuse of the trade for arbitrage or illicit trading. When the prices are off-market how come you allowed the trader to place the trade.
The explanations you provide are quiet contradictory to one another. Please clarify us
If u mark the trades as illicit or arbitrage. Please provide evidence for the same. Please dont quote Bloomberg data feed.
U have already quoted that 2Lp with whom u have tie up has either stopped their feed or widened their spreads.
If this is the truth, the broker is the sole responsible for loss incurred for already opened trades [those trades turning to be losses]. But u dont take responsibility rather blame LP for the same.
Also u accuse of the trade for arbitrage or illicit trading. When the prices are off-market how come you allowed the trader to place the trade.
The explanations you provide are quiet contradictory to one another. Please clarify us
Pharaoh
Brigadier General
- Messages
- 20,308
So we have evidence submitted by Paul showing one trade is off market that is supported by Bloomberg. If AvaTrade does not consider Bloomberg to be the "real market", then that evidence is meaningless. Paul needs to show the claimed off-market prices from what AvaTrade considers to be the true source of their prices.
I am less than pleased to see that Paul again failed to show how these off-market trades are shown to be arbitrage instead of perfectly legal news spike trades that got filled at off-market prices. Successful spike trades are opened quickly, but if the market is agreeable, the trades can be left open for extended periods. From what I've seen in other arbitrage complaints, most arbitrage trades are only for a few pips and are closed as soon as the broker and market price come back into alignment.
I am also very displeased to see that Paul has again failed to answer my question about what the profits would be if the trades had been filled at the source-so-far-undefined real market prices.
I would sincerely hope that AvaTrade passed these trades to the market and they really were filled. If so, Paul should have zero problem answering the question without regard to whether or not the trades were arbitrage.
So far, the evasiveness of Ava's representative has me 100% ready to vote Guilty next week.
I am less than pleased to see that Paul again failed to show how these off-market trades are shown to be arbitrage instead of perfectly legal news spike trades that got filled at off-market prices. Successful spike trades are opened quickly, but if the market is agreeable, the trades can be left open for extended periods. From what I've seen in other arbitrage complaints, most arbitrage trades are only for a few pips and are closed as soon as the broker and market price come back into alignment.
I am also very displeased to see that Paul has again failed to answer my question about what the profits would be if the trades had been filled at the source-so-far-undefined real market prices.
I would sincerely hope that AvaTrade passed these trades to the market and they really were filled. If so, Paul should have zero problem answering the question without regard to whether or not the trades were arbitrage.
So far, the evasiveness of Ava's representative has me 100% ready to vote Guilty next week.
fxgermany
Recruit
- Messages
- 39
I'm quite new here and I have voted guilty on all cases that came up since I joined, but I will go with not guilty on this one.
First of all I think compared to other cases where brokers disappeared with the deposits of their clients this is by far not a class F felony, to stay with the legal terms. The OP would have accepted the cancellation of the trades if that had happened without delay, so the actual count would only be the delay which might even be considered a misdemeanor and not a felony at all. Therefore, I think a guilty verdict would be disproportionately misleading the community.
AvaTrade reserves the right to cancel more or less every trade they don't like, whenever the decide not to like it - that might be morally questionable, but they state it clearly in their terms and conditions, so everyone who takes the time to actually read those, knows the risk. The same goes for the part where they state that they don't adjust trades, but only cancel them as a whole. It doesn't matter what would have happened, nobody is forced to open an account there after all.
I actually do agree that AvaTrade should inform clients as soon as they are moved to that internal watch list, even if that might scare clients away that would have been cleared later on otherwise. However, I don't think this misconduct justifies a public scam verdict. Give me the option to vote for a yellow flag and I'm in, but as long as it is either red or white, I'll go with reasonable doubt.
First of all I think compared to other cases where brokers disappeared with the deposits of their clients this is by far not a class F felony, to stay with the legal terms. The OP would have accepted the cancellation of the trades if that had happened without delay, so the actual count would only be the delay which might even be considered a misdemeanor and not a felony at all. Therefore, I think a guilty verdict would be disproportionately misleading the community.
AvaTrade reserves the right to cancel more or less every trade they don't like, whenever the decide not to like it - that might be morally questionable, but they state it clearly in their terms and conditions, so everyone who takes the time to actually read those, knows the risk. The same goes for the part where they state that they don't adjust trades, but only cancel them as a whole. It doesn't matter what would have happened, nobody is forced to open an account there after all.
I actually do agree that AvaTrade should inform clients as soon as they are moved to that internal watch list, even if that might scare clients away that would have been cleared later on otherwise. However, I don't think this misconduct justifies a public scam verdict. Give me the option to vote for a yellow flag and I'm in, but as long as it is either red or white, I'll go with reasonable doubt.
AsstModerator
FPA Forums and Reviews Admin
- Messages
- 5,745
I am told that AvaTrade and Tradetowin are in the final stages of reaching a resolution on the issue. Because of this, the case will not go to a vote this week. I hope to mark the case as Resolved very soon.
nevadaoutlaw
Private, 1st Class
- Messages
- 40
As I am sort of a rookie, all this is kind of over my head. However, I know that is way too long for a broker to wait to cancel a trade after they have been told to close it. Using the no close tactic, and not expecting the client to go ballistic, is not very smart on their part.
