IB - smaller increments

[Trent]

Quote from Remiraz:

strange. IB, Oanda, Refco and all the OTC dealers claim they get their quotes from Interbank. This "interbank" has to be the source right?

you sure? i was under the impression that the rates has to touch or go thru the limit pipette to be executed. from all the complain posts on Oanda forums regarding how pipette is ripping them off.

There is no single centralised "interbank". Interbank markets consist of hundreds or thousands of participants giving prices which are aggregated by ECN type operators and quote providers.

Do yourself a favor and learn the basics of limit / stop etc. orders from somewhere.

Trent

 

[Steve_IB]

Quote from late apex:

I can't imagine that (pipettes) happening at IB, ever.

The real issue with IB forex is not spreads -- which are second to none, retail -- but routine slippage of 1, 2, 3 and more pips on stop orders in ordinary, not fast, market conditions.

Late apex,
The reason you perceive that you are seeing slippage is because we use the bid/offer price to trigger stops and not the last price.
For example Euro is 1.2355/1.2356
Your sell stop is at 1.2356.
The market could trade multiple times at 1.2356 but your stop wouldn not be triggered. You would only be triggered when the bid becomes 1.2356 or higher. This would then trigger a market order, which will then take out whatever the current bid price is.

 

[pipscooper]

Quote from Steve_IB:

Late apex,
The reason you perceive that you are seeing slippage is because we use the bid/offer price to trigger stops and not the last price.
For example Euro is 1.2355/1.2356
Your sell stop is at 1.2356.
The market could trade multiple times at 1.2356 but your stop wouldn not be triggered. You would only be triggered when the bid becomes 1.2356 or higher. This would then trigger a market order, which will then take out whatever the current bid price is.

Steve,

I am perplexed by your example. It only makes sense if you are talking about a buy stop at 1.2356, which when executed will buy at the prevailing ask price. Maybe my mind is numb but could you either set me straight or straighten out the example?

Also, is there no way in IdealPro to trigger stops off the bid/ask? I thought the TWS had that option (when ask = price then trigger buy stops, when bid = price then trigger sell stops) but maybe this situation is unique to IdealPro or maybe I don't know what I'm talking about? I don't use the stops on IdealPro - just curious how they work.

 

[Steve_IB]

Quote from pipscooper:

Steve,

I am perplexed by your example. It only makes sense if you are talking about a buy stop at 1.2356, which when executed will buy at the prevailing ask price. Maybe my mind is numb but could you either set me straight or straighten out the example?

Also, is there no way in IdealPro to trigger stops off the bid/ask? I thought the TWS had that option (when ask = price then trigger buy stops, when bid = price then trigger sell stops) but maybe this situation is unique to IdealPro or maybe I don't know what I'm talking about? I don't use the stops on IdealPro - just curious how they work.

pips, yes that's what I said. IdealPro triggers stops off the bid/ask. i.e. when ask = stop price then trigger buy stop.
when bid = stop price then trigger sell stop

 

[Remiraz]

Quote from Trent:

There is no single centralised "interbank". Interbank markets consist of hundreds or thousands of participants giving prices which are aggregated by ECN type operators and quote providers.

Thats the official exchange i'm talking about.

Quote from Trent:


Do yourself a favor and learn the basics of limit / stop etc. orders from somewhere.

Price at 1.19999 now. Buy limit at 1.20005, if price hits 1.20001 on Oanda, you don't get filled. You have to wait for it to move again.

Why is this bad? The last digit, the "pipette" is RANOMLY GENERATED by Oanda. Meaning without it you would have got filled.

You don't trade with Oanda do ya? Oanda doesn't use the standard definition of limit/stop orders!

 

[Trent]

Quote from Remiraz:

Thats the official exchange i'm talking about.



Price at 1.19999 now. Buy limit at 1.20005, if price hits 1.20001 on Oanda, you don't get filled. You have to wait for it to move again.

Why is this bad? The last digit, the "pipette" is RANOMLY GENERATED by Oanda. Meaning without it you would have got filled.

You don't trade with Oanda do ya? Oanda doesn't use the standard definition of limit/stop orders!

There is no "official" Interbank market. The dealings do NOT go trough a centralised system. I.e. for example party A may deal with party B and party C will never know that the dealing took place. It is not a transparent market.

No I do not trade with Oanda I use currency futures which are so much cheaper to trade (note: you can catch the spread as well as pay it in futures) also IB's Ideal Pro seems promising, spread in EUR/USD has been 1 pip lately and you can place your own bid/ask (I do that on about 80% of my executions btw).

In any normal system if you place buy limit at 1.20005 and price (ask) is at 1.9999 you will be filled at 1.9999 immediately. Thats the whole point in a limit order: "I want to buy and will pay 1.20005 maximum". So if its available cheaper thats what you get. I do not understand wtf Oanda is doing with limit orders if they work as you desbribed, sounds more like stop orders to me.

Trent

 

[Remiraz]

Quote from Trent:

There is no "official" Interbank market. The dealings do NOT go trough a centralised system. I.e. for example party A may deal with party B and party C will never know that the dealing took place. It is not a transparent market.

I see. Isn't most interbank volume executed thru Reuters?

Quote from Trent:


No I do not trade with Oanda I use currency futures which are so much cheaper to trade (note: you can catch the spread as well as pay it in futures) also IB's Ideal Pro seems promising, spread in EUR/USD has been 1 pip lately and you can place your own bid/ask (I do that on about 80% of my executions btw).

Is there slippage on IB's Ideal Pro? Heard some people say there are slips.

Is max tradeable size 1.5M? I heard also that even if we lift the offer we can only execute max 1.5M leveraged amount. Even though the order book has 3,5,10M etc displayed.

Quote from Trent:


In any normal system if you place buy limit at 1.20005 and price (ask) is at 1.9999 you will be filled at 1.9999 immediately. Thats the whole point in a limit order: "I want to buy and will pay 1.20005 maximum". So if its available cheaper thats what you get. I do not understand wtf Oanda is doing with limit orders if they work as you desbribed, sounds more like stop orders to me.

Well duh, we can read up about different kind of orders in Futures from the net easily.

I was using the "lingo" of Oanda. You shouldn't have jump the gun and assume everyone are idiots. (although I always do LOL )

FYI in Oanda, EVERYTHING that is not a market order is a limit order and all limit orders in Oanda functions as stop orders.

 

[Trent]

Quote from Remiraz:

I see. Isn't most interbank volume executed thru Reuters?



Is there slippage on IB's Ideal Pro? Heard some people say there are slips.

Is max tradeable size 1.5M? I heard also that even if we lift the offer we can only execute max 1.5M leveraged amount. Even though the order book has 3,5,10M etc displayed.



Well duh, we can read up about different kind of orders in Futures from the net easily.

I was using the "lingo" of Oanda. You shouldn't have jump the gun and assume everyone are idiots. (although I always do LOL )

FYI in Oanda, EVERYTHING that is not a market order is a limit order and all limit orders in Oanda functions as stop orders.

I do not know how big Reuters' share is. Basically two banks can for example deal directly with each other without going trough Reuters or anyone else and that would be a transaction happening in the Interbank market without any 3rd party knowing about it.

I cannot comment on slippage on IdealPro as I have not used it yet. The problem is that the execution, PL etc stuff is not good enough as of yet. For example it does not work properly with front ends.

The size on best bid/ask is usually far more than 1.5 million, I think 14 million is pretty common. I don not know if there are limits as to how much you can do at one clip.

Trent

 

[Remiraz]

Quote from Trent:

I do not know how big Reuters' share is. Basically two banks can for example deal directly with each other without going trough Reuters or anyone else and that would be a transaction happening in the Interbank market without any 3rd party knowing about it.

So if I sell you my shares in private would a 3rd party know it? We don't have to go through NASDAQ or NYSE for that right? What about preferred stocks? Privately sold options?

:eek:

Quote from Trent:


The size on best bid/ask is usually far more than 1.5 million, I think 14 million is pretty common. I don not know if there are limits as to how much you can do at one clip.

Well duh, i wrote it displaying 3,5,10 M didn't I? lol. the thing is, i heard traders complaining the max tradeable is only 1.5M despite the size on the best bid/ask.

 

[Trent]

Quote from Remiraz:





Well duh, i wrote it displaying 3,5,10 M didn't I? lol.

Where did I say that you did not?

Anyway I have spent too much time on this allready so enough. If you really cannot crasp the difference between the workings of the interbank market and for example Nasdaq or CME then so be it.

Trent