I am done with Futures... going back to Forex

[RedDuke]

Played Futures nearly for one whole year with 40K capital. I made some money actually but now I have decided to go back to Forex. Futures market is highly fragmented and far ancient. I

The comment indeed makes no sense as others mentioned. Futures are centralized on a single exchange, you have the best fighting chance there among anything else.

Forex on retail level is a virtual casino, aka bucket shop. It is not a real market.

Do not want to deal with multiple platforms, just open Interactive Brokers account, it has it all.

 

[bone]

The comment indeed makes no sense as others mentioned. Futures are centralized on a single exchange, you have the best fighting chance there among anything else.

Forex on retail level is a virtual casino, aka bucket shop. It is not a real market.

Do not want to deal with multiple platforms, just open Interactive Brokers account, it has it all.

About half of my clients come to me with an Introducing Broker. I tell them to shitcan that arrangement immediately. Set up an account directly with RJ O'Brien, Rosenthal Collins, Advantage... They just don't seem to realize that with an IB, you are introducing serious latency into your exchange messaging. When you place an order, you are messaging your IB first, then once those checks are completed the IB messages the FCM, then once those checks are completed the order is then routed to the exchange. It's slow and I've noticed that IB's tend to have ECN issues from time to time.

 

[RedDuke]

About half of my clients come to me with an Introducing Broker. I tell them to shitcan that arrangement immediately. Set up an account directly with RJ O'Brien, Rosenthal Collins, Advantage... They just don't seem to realize that with an IB, you are introducing serious latency into your exchange messaging. When you place an order, you are messaging your IB first, then once those checks are completed the IB messages the FCM, then once those checks are completed the order is then routed to the exchange. It's slow and I've noticed that IB's tend to have ECN issues from time to time.

I did not mean Introducing Broker, but Interactive Brokers.

 

[heispark]

Now I REALLY don't understand. Why "multiple platforms /brokers/data feeds"? I've never felt disadvantaged using one broker/platform and data feed. Maybe I am ignorant of the need?

Be careful especially when you use CQG feed. Charts can look different broker by broker or data feeder by feeder. More details: https://www.elitetrader.com/et/threads/cqg-vs-thinkorswim-data-feed-accuracy.319914/
In this week, I was trading with CQG feeded Tradingview chart (via AMP Futures). As far as I remember correctly, previous lower low in 4H EURUSD chart was nearly breached in CQG chart while others don't. It can lead to a serious result when you put stop loss. Also, because some indicators/tools are available only in certain platforms, I have to manage several platforms (for example, volume profile in TDA's TOS is crap, VWAP in IB's TWS is crap, manually drawing Harmonic patterns is easier in Tradingview...etc.) As a result, I found myself opening multiple charts from multiple brokers/data feeders/platforms to trade Futures. I just want to focus on trading itself!

 

[Sig]

About half of my clients come to me with an Introducing Broker. I tell them to shitcan that arrangement immediately. Set up an account directly with RJ O'Brien, Rosenthal Collins, Advantage... They just don't seem to realize that with an IB, you are introducing serious latency into your exchange messaging. When you place an order, you are messaging your IB first, then once those checks are completed the IB messages the FCM, then once those checks are completed the order is then routed to the exchange. It's slow and I've noticed that IB's tend to have ECN issues from time to time.

I haven't used an IB so ignorant questions, but aren't you often able to get into those firms with lower asset levels with an IB? And does an IB always require that you go through their infrastructure?

 

[heispark]

Also, my strategy change must have affected this decision to be honest. Futures is excellent choice for scalpers (especially tick chart based scalpers) using single entry/exit with tight stop loss. Now I am a swing/position trader using multiple entries/exits without stop loss. I have stronger edge on currency trade rather than commodities or indices. I also trade cross currency pairs in addition to major pairs. If this is the case, obviously Forex is the right choice. The only concern is high trading cost due to high swap rate.... Actually, quite big concern for mid/long term traders..... Unlike commission, swap is not negotiable....

 

[schweiz]

Now I REALLY don't understand. Why "multiple platforms /brokers/data feeds"? I've never felt disadvantaged using one broker/platform and data feed. Maybe I am ignorant of the need?

No, you are not ignorant, he is. He wants to impress people but does not understand the nonsense he is telling. Happens often with ignorant people.

 

[Metamega]

Be careful especially when you use CQG feed. Charts can look different broker by broker or data feeder by feeder. More details: https://www.elitetrader.com/et/threads/cqg-vs-thinkorswim-data-feed-accuracy.319914/
In this week, I was trading with CQG feeded Tradingview chart (via AMP Futures). As far as I remember correctly, previous lower low in 4H EURUSD chart was nearly breached in CQG chart while others don't. It can lead to a serious result when you put stop loss. Also, because some indicators/tools are available only in certain platforms, I have to manage several platforms (for example, volume profile in TDA's TOS is crap, VWAP in IB's TWS is crap, manually drawing Harmonic patterns is easier in Tradingview...etc.) As a result, I found myself opening multiple charts from multiple brokers/data feeders/platforms to trade Futures. I just want to focus on trading itself!

Don’t quote me on this but I would guess the difference is how their backadjusting the contracts.

Do they backadjust? When do they roll a contract, do they adjust by a level, maybe a ratio?

I always found using price levels on a continuous future chart a weird idea. Perhaps someone generalizing an area but when someone draws a hard level at a high “x” months ago as some definitive point, you got to wonder if they know how that chart was stitched together. ( I don’t trade futures btw ).

 

[EchoTrader]

The time stamps between all data providers are different, for one thing. CQG self corrects its data on the milliseconds time frame.

I have the choice of employing time or tick, tick is more accurate, milliseconds are faster. If you have an excellent connection, use tick. I have no problems.

Secondly, all trading software are designed in their own way of time stamping. I know, it's weird, but it's true.

Hope this helps to clear up these crazy issues.

I use CQG data and I have zero problems.

ET

 

[bone]

I haven't used an IB so ignorant questions, but aren't you often able to get into those firms with lower asset levels with an IB? And does an IB always require that you go through their infrastructure?

I'm not going to comment publicly about discount brokers with IB exchange status but you can very well guess. And yes, before they come to me on occasion clients shopped around for commission rates and used discount Introducing Brokers. We dispense with that quickly. Is it worth it to save $150 per month when your platform freezes up while trading Eurex at 4:00 am ? Is it worth it to enter an order to hit a bid or lift an offer and miss them ? Is it worth it to try to cancel all your working orders one minute before Civilian Unemployment and you get a delay on confirmation ? All good questions.

But same here - I've never personally used one for my own trading as well. I stick with the big FCM's. But to answer your question - from what my clients told me your order entry has to go through the Introducing Broker first before it gets routed to the FCM then the exchange. So, let's say that you have an office in Toronto and you have your futures account with Acme Discount Introducing Broker in Minneapolis, Minnesota who clears RJ O'Brien - your order gets routed first to Minneapolis, then to RJ O'Brien in Chicago and finally to the CME. RJ O'Brien isn't bad at all because they're going to have co-located servers and a very good ECN infrastructure and support network. The IB's network latency and reliability can be an issue from my experience working with clients.

But Sig, here's the kicker. That order you are sending from Toronto to Minneapolis it is checked by the IB for:

• The account on the order is active
• The account is authorized to trade the product
• The broker or trader is authorized to use the account
• The order is within the order size and price deviation limits placed on the user by the clearing firm or trading firm.

Then, when it gets routed to RJ O'Brien in Chicago - guess what; those same checks I listed above get done all over again by the FCM that the IB is using from what I understand. So not only do you have this additional ECN geographical routing, but you've got duplicated order checks. When the order does get routed to the exchange from the FCM, the CME will in turn check for SPAN margin and published product-specific position limits but that happens very quickly.