CME vs Forex

[toby400]

Quote from sukhen:

It appears that the currency futures market is lot better and way to go. It may not be for 24 hours but it's available during the prime time anyway. Cheating appears to be not there but I have a few questions -
1) Do the futures brokers offer real time charts?
2) Are mini lots available? And, are there options with nominal size of mini lots?
3) Is on chart trading offered?
4) It's practically a 24 hours market, how can we traders close our positions during off-hours? If GLOBEX is used, will there be a premium to trade during those hours?
5) How can we find the brokers who charge less?

Sorry, my questions may appear very elementary but need to know before putting real money.

Thank you guys in advance

- Sukhen

why not trade the emini currency futures on globex and have insignificant spreads for whatever time frame you stay in the trade ??

best,

surfer


__________________
INTRENDX--- global systems

knowing insight and statistical might


http://www.cme.com/fx_retail/index.html


Hope this helps ( acknowledgements to Marketsurfer)

 

[cvds16]

You have lots of questions though not all of them can be answered just like that, and it depends on your broker.
1) I use IB, pay 2.4 per contract so that makes 4.80 rt.
I use quotetracker with a link to get my futureschart (costs you nothing). For the spot I use one of the demo's of an fx-broker.
2) Mini-lots are available, liquidity though is in the big contracts.
3) On chart trading think this depends on your broker, who needs this however, IB can do everything I want when you program some hotkeys: trailing stops, brackets, stop limits ....
4) It closes for one hour, and for that not exactly the most busiest hour of the day, so chances of big moves happening are not very big. You could however hold a backup account with an fx-broker where you could do the hedge if you want to close urgently (I trade only intraday during London hours myself, so all my positions have been closed by that time)
5) Do a search on the net
; seriously I have been looking and havent found anyone cheaper than IB, except for really big volumes.

 

[fxtrader]

York:

It depends on what currency pair your going to trade. For me, the CME is cheaper & as liquid for the E/$. But if your looking to trade exotics, trade the hedge on simular currency pairs, need max. leverage, or want to play the 5pm interest payment then spot is the obvious choice. Over 90% of my intraday currency trades are in the E/$ and the CME is doing a great job in competing with the spot mkt.

 

[Jayford]

Quote from toby400:

why not trade the emini currency futures on globex and have insignificant spreads for whatever time frame you stay in the trade ??

best,

surfer


__________________
INTRENDX--- global systems

knowing insight and statistical might


http://www.cme.com/fx_retail/index.html


Hope this helps ( acknowledgements to Marketsurfer)

The minis are very illiquid and have wide spreads. Gotta go with the full contract imo.

jay

 

[chaos]

Quote from roberk:

Any of the brokers who are offering even 3 pip spreads (except for the one I mentioned Commerce) are still out to make sure they get their cut. You will often find you buy or sell is not accepted and you get a message asking if you want to accept the new price (unless it moved against you since you placed your order in which case you will be filled soooo fast.
The forex brokers can set the rates they want, it is nothing like futures where you are routed straight to the exchange and your broker can get no more than his commission. the forex brokers don't even charge commission because why should they when they get much more by playing their spreads. It is is a real money spinner, big bucks.
Sure some forex brokers will talk about 2-3 pip spreads. it is called advertising or marketing. Sometimes they can only get 2 or 3 ticks out of you on a trade. Still more than futures broker gets on commission.
This should be made clear to all traders.

roberk,

I have been trading with Oanda for nearly a year, I've made hundreds of trades and I have never been requoted. And yes, you do get 2 pip spreads on the EURUSD. Day in, day out. It's not talk, roberk, it's action.

True, the spreads widen a pip or two sometimes during the night and on the weekends they go to 10 pips generally, but that's because Oanda has to protect itself during illiquid conditions. Otherwise, they maintain consistent, dependable tight spreads. (BTW, Oanda is the only broker I know of that is open over the weekend. People don't usually trade on the weekend but if you must open or close a position, you have the convenience of doing so. It's just that you'll pay extra for the convenience.)

A number of other brokers such as FXCM offer guaranteed spreads of four or five pips on the EURUSD. You pay the same price at all times and you never get slippage. I don't trade with FXCM but I have read lots of posts at Moneytec by people who use them and have never heard of requotes.

If you're taking from experience about requotes, you're either dealing with the wrong brokers or you're talking from experiences you had several years ago. The industry has advanced a lot in a short time.

************

IMO, people who want to learn about forex brokers should do their research at Moneytec, which is a chat board that focuses on forex. I don't think I've read a single post there by a trader who prefers trading the futures to a favorite forex broker they have discovered. There is lots of discussions about brokers, lots of criticisms about different aspects of their operations, lots of cautions about certain brokers. But really, there is no theme of discontent with regards to requotes. That's simply not an issue. That's why I say roberk's experiences are perhaps dated and no longer representative.

Let me add that I am not affiliated in any way with Oanda, FXCM or any other broker. I'm just a small-fry forex trader wishing that you all have a great year in 2004!

chaos

 

[traderob]

Quote from chaos:

roberk,

I have been trading with Oanda for nearly a year, I've made hundreds of trades and I have never been requoted. And yes, you do get 2 pip spreads on the EURUSD. Day in, day out. It's not talk, roberk, it's action.

True, the spreads widen a pip or two sometimes during the night and on the weekends they go to 10 pips generally, but that's because Oanda has to protect itself during illiquid conditions. Otherwise, they maintain consistent, dependable tight spreads. (BTW, Oanda is the only broker I know of that is open over the weekend. People don't usually trade on the weekend but if you must open or close a position, you have the convenience of doing so. It's just that you'll pay extra for the convenience.)

A number of other brokers such as FXCM offer guaranteed spreads of four or five pips on the EURUSD. You pay the same price at all times and you never get slippage. I don't trade with FXCM but I have read lots of posts at Moneytec by people who use them and have never heard of requotes.

If you're taking from experience about requotes, you're either dealing with the wrong brokers or you're talking from experiences you had several years ago. The industry has advanced a lot in a short time.

************

chaos

Thanks for the info. The brokers have obviously improved a lot since I was trading forex regularly. AS I said I still keep an account with Commerce bank and they give a guaranteed no slippage 3 pip spread - but that one pip still kills the deal as against futures. I had an account with FXCM and GCI.
FXCM were good on not requoting but sometimes had slippage in fast moving markets. I note on moneytec several posts say that slippage is a problem on oanda too sometimes.

NOTE* if FXCM charge 4 pips this is 10 times more than what one pays in commissions on futures. Even 2 pips is a lot more. However if oanada can always fill in 2 pips - without slippage - then the advantages of being able to have mini- lots and higher liquidity would make it possibly better than or equal to futures.


Anyway Oanda does seem to be a better firm than the others although read the fine print before getting an account with Oanda
Your Margin Account with OANDA is not insured under any state or federal insurance program, or by any other entity. In the event OANDA should become insolvent or file for protection under the bankruptcy laws, it is possible that you would lose the entire amount in your Margin Account.

 

[chaos]

Hi roberk,

Since my currency trading experience has been entirely in the forex realm, I'm not making the argument that forex brokers are a better alternative than the futures market. I was simply saying that traders should not avoid forex brokers out of concern about requoting as that no longer seems to be an issue.

For myself, I trade using stops of 70 to 120 pips and my targets are often quite a bit wider. So an extra pip or two on the spread is not something I worry about.

BTW, Oanda explains on its site that it endeavors to offer the tightest spreads it can based on the market activity at any point in time. Thus, in the liquid conditions that prevail during a normal trading day, it offers 2 pip spreads on the EURUSD, which, to my knowledge, is the best deal available. It apparently monitors the spreads and trading activity at a selection of major banks and uses a proprietary algorithm to set its own spreads. While the tight spreads are great, the downside is that Oanda does not guarantee against slippage. So sometimes, instead of a two pip spread, you will pay three, four or more pips.

If Commerce bank offers three pips on the EUR and guarantees no slippage, it is possible that, in the end, it would be a better deal than Oanda. I'd be interested to hear if anyone has done research into this.

Good luck to you in your trading.

chaos

 

[cvds16]

Quote from chaos:



For myself, I trade using stops of 70 to 120 pips and my targets are often quite a bit wider. So an extra pip or two on the spread is not something I worry about.

[/B]

If you think an extra pip or two is nothing to worry about, then you dont understand the essence of trading imo. Sorry to say so, but never have i seen any professionel trader say that.

 

[chaos]

Quote from cvds16:

If you think an extra pip or two is nothing to worry about, then you don't understand the essence of trading imo. Sorry to say so, but never have i seen any professional trader say that.

Hi cvds16,

If your style is to do frequent scalp trades for small profit targets, then a pip or two difference in the spread will add up quickly. But if you trade a currency only once every several days for relatively large profit targets, as I do, then a pip or two is not going to make a lot of difference. Sure I'd rather have those pips in the bank than give them to my broker, but my trading style easily overcomes the spreads I pay at Oanda and generates profits in my account.

Good luck to you in your trading,

chaos

 

[Transact Futures]

All this has been a big help. I feel a lot more comfortable with the CME. My rates are good and I can trade basically 24 hours on the system. I have been trying to sleep so that really doesn't bother me that it only trades 23 hours a day.