silly question?

peter wilkes

Recruit
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6
I'm all set to open an account with GFT , I was reading their trading polcy and came across a section regarding day trading ,(scalping i presume) it says day trading can be dangerous due to one possibility that you may not be able to exit the position due to liquidity and you could sustain substantial losses , could someone tell me if this happens often? and can it happen with an ECN broker such as MB trading ?,or just with Market makers?
Thanks in advance Peter
 
That's actually a very good question.

Bad slippage on exits can happen during extreme volatility or low liquidity times with all brokers, but is more likely to happen with bucket shops than ECNs. The worst brokers will use this to deliberately hold your profitable position open once the market starts to trend against you.

All brokers have disclaimers like this, but some have worse records than others. Definitely trade with the smallest amounts possible until you learn the limitations of the broker.
 
What about stops

That's actually a very good question.

Bad slippage on exits can happen during extreme volatility or low liquidity times with all brokers, but is more likely to happen with bucket shops than ECNs. The worst brokers will use this to deliberately hold your profitable position open once the market starts to trend against you.

All brokers have disclaimers like this, but some have worse records than others. Definitely trade with the smallest amounts possible until you learn the limitations of the broker.

What about stops/loss order will they hold it beyond what your stop is set too ? I mean lets say more then 10 pips or so. Does it just keep going until they can close ?
 
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