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Interest Free forex brokerages?
- Thread starter russell007
- Start date
What if you are not islamic?
If there is a place in occidental world where banks do make bankroupt it is the USA, not in western europe.
Statement of "having money outside the US contains huge risks" are totaly ridicoulus
Statement of "having money outside the US contains huge risks" are totaly ridicoulus
Quote from andrey_tech:
Whatever the company outside U.S contains huge risks about redeeming funds. It is especially for forex brokers , better say forex market makers or bucketshops. Be careful about scammers.
And remember there is no free lunch. If so, how do you know it is poison-free ?
Depositing your money with the guy who lives in a van down by the river is also a good option, at least you get a drinking buddy and you know one place where he was for real,
unlike anonymous post boxes, rented servers and anonymized tax havens spread all around the globe so that you'll never find out who what was where nor your money.
unlike anonymous post boxes, rented servers and anonymized tax havens spread all around the globe so that you'll never find out who what was where nor your money.
There may be an alternative as proposed by one forex website that I will not name:
The idea is to make money from the differential of interest of 2 pairs that are almost inversaly correlated.
As the pairs are not 100% inversaly corralated, some adjustment have to be made around once a week to keep the trading account in a kind of "delta neutral" situation and collecting only interest.
How much return can be done, is not mentionned in the website, but all is done in same account and off course the account is paying interest and can be a US account. The problem is as pairs are 95-98% correlated we need large numbers of lots (mini-lots) tomaintain neutral (ex 48 lots of US/£ and 50 lots of £/CH)
The idea is to make money from the differential of interest of 2 pairs that are almost inversaly correlated.
As the pairs are not 100% inversaly corralated, some adjustment have to be made around once a week to keep the trading account in a kind of "delta neutral" situation and collecting only interest.
How much return can be done, is not mentionned in the website, but all is done in same account and off course the account is paying interest and can be a US account. The problem is as pairs are 95-98% correlated we need large numbers of lots (mini-lots) tomaintain neutral (ex 48 lots of US/£ and 50 lots of £/CH)
And then the correlation in the cross-pair that you are actually trading goes out the window because of a black swan type of event and you are screwed by trading something you didn't even realize....
It will be much better to trade USD/CHF in interest positive swing trading than try to maintain a hedged spread through GBP. At least you will see it on the chart what you are really trading...
As for trying to screw your market maker out over a risk-free interest hedged trade, they will eventually shut you down or go broke. Trust me they will shut you down first. I still don't get how Marketiva is hedging their position (or pretending to do it) if they aren't paying or receiving daily swap. What bank is taking the other side of their trade?!? It makes no sense.
Go and figure out how to really trade instead. In the long run your account will thank you.
It will be much better to trade USD/CHF in interest positive swing trading than try to maintain a hedged spread through GBP. At least you will see it on the chart what you are really trading...
As for trying to screw your market maker out over a risk-free interest hedged trade, they will eventually shut you down or go broke. Trust me they will shut you down first. I still don't get how Marketiva is hedging their position (or pretending to do it) if they aren't paying or receiving daily swap. What bank is taking the other side of their trade?!? It makes no sense.
Go and figure out how to really trade instead. In the long run your account will thank you.
It is not a perfect system and not a risk free system, it is just an idea send around and may be need to be investigated further, seems that someone somewhere made it to work.
You make your 2 pairs to be correlated as close as posible to 100% (there are website giving correlations) then You should immediately have limit buy or limit sell that come automaticaly to readjust the correlation it it deviate from neutral and it will.
The idea and the difficulty is to calculate with a good accurancy at what level to place automatic buy or sell, may be multiple buys and sells at different levels in order to maintain the neutrality of the correlation during normal fluctuations of currencies pairs, of course not during black swan event. if we succeed during normal trading range, then the account value should remain almost constant but differential of interest will be added according to number of lots you have and you may have many lots open with very little risk as you are in a neutral position.
Black swan event are not frequent if you use major currencies like $US, £ and Eur or Fswiss and tell me who will not be affected during a Black swan event unless by chance he is on the right side at that time.
You make your 2 pairs to be correlated as close as posible to 100% (there are website giving correlations) then You should immediately have limit buy or limit sell that come automaticaly to readjust the correlation it it deviate from neutral and it will.
The idea and the difficulty is to calculate with a good accurancy at what level to place automatic buy or sell, may be multiple buys and sells at different levels in order to maintain the neutrality of the correlation during normal fluctuations of currencies pairs, of course not during black swan event. if we succeed during normal trading range, then the account value should remain almost constant but differential of interest will be added according to number of lots you have and you may have many lots open with very little risk as you are in a neutral position.
Black swan event are not frequent if you use major currencies like $US, £ and Eur or Fswiss and tell me who will not be affected during a Black swan event unless by chance he is on the right side at that time.
Quote from piphunter:
And then the correlation in the cross-pair that you are actually trading goes out the window because of a black swan type of event and you are screwed by trading something you didn't even realize....
It will be much better to trade USD/CHF in interest positive swing trading than try to maintain a hedged spread through GBP. At least you will see it on the chart what you are really trading...
As for trying to screw your market maker out over a risk-free interest hedged trade, they will eventually shut you down or go broke. Trust me they will shut you down first. I still don't get how Marketiva is hedging their position (or pretending to do it) if they aren't paying or receiving daily swap. What bank is taking the other side of their trade?!? It makes no sense.
Go and figure out how to really trade instead. In the long run your account will thank you.
Quote from parisd:
It is not a perfect system and not a risk free system, it is just an idea send around and may be need to be investigated further, seems that someone somewhere made it to work.
You make your 2 pairs to be correlated as close as posible to 100% (there are website giving correlations) then You should immediately have limit buy or limit sell that come automaticaly to readjust the correlation it it deviate from neutral and it will.
The idea and the difficulty is to calculate with a good accurancy at what level to place automatic buy or sell, may be multiple buys and sells at different levels in order to maintain the neutrality of the correlation during normal fluctuations of currencies pairs, of course not during black swan event. if we succeed during normal trading range, then the account value should remain almost constant but differential of interest will be added according to number of lots you have and you may have many lots open with very little risk as you are in a neutral position.
Black swan event are not frequent if you use major currencies like $US, £ and Eur or Fswiss and tell me who will not be affected during a Black swan event unless by chance he is on the right side at that time.
Ok thanks for further explanation. I appreciate you taking the time. I hope to review this later and share some thoughts.
I've just read some discussion of ideas like this before and it is funny how sometimes people end up trading things that they don't even realize.
Edit: Example maybe?
Eg. We all know EUR/USD and USD/CHF are the highest long-running correlated pairs. So you could Buy EUR/USD and Buy USD/CHF but all that does is create a synthetic EUR/CHF position which is interest positive... somehow I don't think this is what you mean do you?
Of course it can be profitable trading EUR/CHF in an interest positive direction as it bounces around its fairly definable trading range.... but I'm just getting your idea confused with something else right?