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Who loose money when we win or make profit from forex trading?

Discussion in 'Beginners Bootcamp' started by RONSON, Jan 14, 2019.

  1. RONSON

    RONSON Recruit

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    When we make profit from the forex trading, who loose? Or from where the money come from? Forex trading is not like share trading. In share trading there are buyer and seller with the exact quantity and specific contract for trade. When you buy share you are paying money to the seller indirectly, which meant if he make profit, the money come from you as a buyer. Whereby in forex trading there is no specific contract or quantity to trade. So my question is if you make profit in forex trading where is the money come from? Let say i buy 1 lot EURUSD at 1.1450 and close it at EURUSD 1.1500 and i make 500 USD profit, so who loosed this 500 USD? Like in money changer they bought in USD notes for exchange and make profit from the spread. They will sell USD notes as long as they can make profit base on current exchange rate. What happen if the USD become weaker? I believe no one is willing to loose money doing business and they can just put up a sign board telling that they are running out of USD notes or they can maintain their exchange rate but no want will buy from him. No matter how they still can prevent their losses and selling again USD notes when the exchange rate bounce back. I am referring to true ECN account where the trade is link to the banker or instituitional liquidity provider. I dont think they want to loose money either. So again my question if i make profit in forex trading, who loose? Sorry for my bad english if you could not understand my question. I really need to find out this before decide to go further in this forex trading. I started trading forex two months ago and still a newbie in the learning stage. So far had loosed few thousand USD but i still see a potential to make money from forex.
     
  2. nahiyar

    nahiyar Private, 1st Class

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    Do no know surly who face loss when I get my profit . Actually we all trade in forex market not go to any buyer or seller directly for trading. It is all to your broker who pays you profit if you do successful trading, or in your loss your money goes to broker. Our direct connection is with broker and its trading terminal , At the back end who is suffering we had no concern.
     
  3. EURUSD

    EURUSD Sergeant Major

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    Maybe, in this case, we should consider with type broker that will be used, there are broker called as dealing desk and non dealing desk, dealing desk is market maker, usually they take fixed spread, its mean order client only record on the book of company and not forwarding to Intermarket, so if client getting loss hence broker will profit and vice versa

    While non-dealing desk if type broker like as ECN which they will take profit from the spread, and order client forwarded to intermarket, but I ever hear if this type broker also possible increasing spread when news high impact or in high volatility market
     
  4. RONSON

    RONSON Recruit

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    Thanks for your answer. Actually i want to find out how true is this so call true ecn account. What you said is correct, we are player and the broker is banker.
     
  5. RONSON

    RONSON Recruit

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    I like your answer. I wish to find out how true is this so call true ecn account. When we invest small no body bother but when we invest big then a lot of things need to clarify. I also found out that this mt4 platform got hidden script to benefit the broker. I dont have proof for that but i can tell by comparing the rate shown in others website such as tradingview and investing.com but no choice so far this is the best mobile platform i knew. I only trade on mobile platform. Cheers
     
  6. HollyHopScotch

    HollyHopScotch Recruit

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    If the broker is a market maker then they lose when you win but generally someone has to lose for you to win.
     
  7. HollyHopScotch

    HollyHopScotch Recruit

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    True ECN brokers will put your trade to market and just take the commission.
     
  8. EURUSD

    EURUSD Sergeant Major

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    If already start with big amount of money, indeed this will become the sensitive case, if finding a bad broker and facing a problem with withdrawn money, it will make disappointed of course, so looking good broker also need research, FPA is one source to getting some review for broker, but also need to compared with another source
     
  9. RONSON

    RONSON Recruit

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    This is what true ecn suppose to be. If this is true then i am alright with it. Thanks
     
  10. RONSON

    RONSON Recruit

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    Thanks for the advice.
     

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