Tuesday, April 1, 2008

"Wake up, Neo! Matrix has you"

So many ads telling me that I must try FOREX with them. Because they do not charge the comission or their fixed spread is as low as N pips. When I try them I can see that I can not place limit order less than N pips away from the current price. When I try to get in the market - their order processing engine tells me that I was requoted.

Is it the objective reality? No!
The market makers invented the fixed spread and it will kill me if I trade short-term. But the reality is there is NO FIXED SPREAD at forex.

Maybe better to pay the fixed comission instead of fixed spread? Sure!
Finally I found the right broker for me. The keyword to search is "ECN type broker". I picked up the MBTrading/EFX Group (EFX seems to be a part of MBT, if EFX handles only forex accounts, with MBT you can also trade stocks). I picked up them because:


  • I can open account with US$400 only.
  • The comission is low. For USD/JPY it is US$1(entry+exit) only for the minilot.
  • They provide with free-of-charge SDK with C#/CPP/VB samples.
  • They provide with LEVEL II data which is very usefull for short-term traders.

The minus of the ECN broker (it seems any ECN broker) is that he does not provide me with free-of-charge charting software, so I must look around for the solution. I can not invest more than US$1200 for the NeoTicker with the account size of US$1000 only.

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