Looking for a good IB

[longtang]

Hi all:

I know usually it is IB's who are posting looking for clients. But, this is a different kind of post. I am actually a client looking for an IB.

I currently have an IB who is giving me 4 dollars per standard lot rebate. But, I feel that I am doing all the work (ie trading and taking risks) and he is just sitting and collecting a cut of my spread. I feel that I should be getting much more than $4 rebates per standard lots [at FXDD where I get 2 pip EURUSD and 3 pip USDJPY and 4 Pip GBPUSD spread.]

I trade with a fair deal of volume. I have already done 120 standard lots this month so far. I am looking at trading about 350 to 400 standards for the month. So, as you can see, this is no small potatoes in terms of volume.

So, if any IB's are out there who wants to compete with $4 rebate, (ie you need to offer me at least 7 dollars rebate) please let me know. But, before you contact me, here are my requirements:

1. You have to be a reputable IB. I will phone interview you and ask for references.

2. You have to be registered with the NFA.

3. You have to be willing to give me a $7 per lot rebate.


As you can see, I consider myself somewhat of a savvy consumer and I won't take any B.S. Please be serious if you are going to contact me. I am basically offering you a chance to make commission off of me. You treat me right and I will treat you right.

signed: Volume Trader.

[EFXandy]

Hi Longtang,

If the money you want to receive is in the form of a REBATE, then I am not sure if I can help out. If it's $7 you want back, that may be possible, but it wont be in the form of a rebate. What I mean, is that after each standard lot, you are looking to do $3 better than where you are currently doing business, then yes. The problem is that you are using a deal desk, so you are paying a very wide spread. Let's take your example of USD/JPY (3 pip spread). If you could trade on a system where the spread was consistantly 0-1 pips wide, you would say a minimum of $10. Much better right?

I have a few suggestions if you are interested...my company and possibly a few others to check out. But there are ways you can get what you are looking for.

Andy

[longtang]

Hi Andy:

EFX's TTO order is, to put it mildly, less than satisfactory and I have never been able to get anyone at EFX to take my gripe seriously. [In fact, I get patronizing comments like: "99% of traders don't have that problem." Well, I guess I am in the 1 percentile of idiot clients, aren't I? Yeah.]

So, I have pretty much given up on trying to tell people at EFX my dissatisfaction with those TTO orders. But, since you have posted on my thread, I will (god help me that I don't pull my hair out) try once again to express just how much of a poor excuse for technology that the TTO order is:


I have tried a live micro mini for two months now. And I can show you my account statement at EFX. It is full of slippage. And it is due to the TTO:

The platform does not offer stop and limit orders. Instead, they have a TTO order. TTO orders are similar to stop and limit orders. So, Say you want a limit at 2.0600, then, when the market gets to 2.0600 , the EFX platform will place a MARKET order to sell at 2.0600. HOWEVER, since this is a MARKET order, you will often get slipped several pips. Out of the 22 trades I had, a majority of them had experienced slippage. [And the slippage is mostly against me! Just bad luck, I guess.].

Sure, you can say: This slippage represents real market conditions. Yes. This is true! However, This is unnecessary slippage. Let me explain why: If you watch their training webinar, they tell you explicitly that to avoid slippage, you should use limit orders to enter and exit the market! YET, on their TTO order, they force you to go with a market order. See, the TTO's are not real orders (ie they don't go on the level II quote book) until the market trades through the TTO price. Then, the TTO order is converted to a Market order. And since it is a market order, it comes at the end of the que for all the other orders already in the books. So, NO, wonder you get slipped with TTO's. [Because, By the time the TTO is converted to Market order, all the liquidity at that particular price has dried up.]

If they would just allow TTO orders to be true limit orders (that actually go into the level II order book at the time it is placed), then they could easily eliminate a huge portion of the slippage!

I hope you understand this point that I am making. Justtin understands this point, but he gave me the explanation that they hide TTO orders from the order books so that other people would not be able to hunt our stops. That seems pretty flimsy as a reason and I don't buy it. I think the real reason is that they just don't have to platform technology to actually have two orders (both the stop and the limit orders) in the book at the same time (ie they are afraid that if they really placed their limits and stops onto the order book, then there is a chance that both could be hit at the same time.) So, My thoughts are that they should come up with a way to address this issue and make TTO's true limits and stops that actually show up on the books! I mean, seriously: the reason I would go with an ECN is because I want to avoid slippage! Yet, I am getting slipped just about every trade! I really do hope EFX fixes this blemish.


cheers.

[EFXandy]

Longtang,

Thank you for your quick reply. I am very sorry that you seem to be having trouble finding the type of order that you need. I am not sure who told you that you are only 1% of traders who have trouble understanding the TTOs and most have no issues with it. I will ask around to see if anyone gave you that TERRIBLE response. I can assure you, that this is not a response I would endorse. The fact of the matter is, there are so many different TTOs, that they can be confusing. It is only after reading through all of them and practicing the many TTOs that you will begin to love them and rely on them.

I will look into this customer service response, and make sure you are not made to feel like an "idiot". There is simply no excuse for that type of treatment.

As far as your issue with the TTO order becoming a market order, thus exposing you to inherent market slippage, I could not agree with you more. I wonder if we will be able to add that type of intricate order onto our next platform, but given that TTOs by nature link multiple orders with each other, I can only imagine the difficutly is large (poor choice of words, but it works)

The only way I see around your order selection issue is to forget the TTO in your situation, and use two different orders, one for your stop/loss, and one for your profit target limit. For the profit target, that is simple enough, just use a limit order. For the stop/loss, I would suggest using a stop-limit order. Enter your trigger, and then your limit on that stop, thus limiting what you will eventually pay in slippage...you can make it 0 to infinity pips wide. The problem I have with this, is that if you are wrong in a trade, and have to get stopped out, you should just get out and not get greedy. Yes, you open yourself up to slippage, but you also avoid the chance that you miss your stop/loss completely, leaving you in a naked losing position. The risk is up to you.

I do hope you will give it another shot, or at least give me a call so we can find out what a better option for you is.

Either way, I wish you luck.

Andy

[EFXandy]

one more thing. I know you said the main reason you chose an ECN was to avoid slippage. I do think we all agree there are many good reasons why one would chose an ECN over a DEAL DESK. The major reasons would be, tighter spreads (as close to institutional pricing as I have seen. If you check out pair prices on Bloomberg, more often then not, those are very similar to our spread prices!) Another major reason to chose an ecn would be the honestly and intergrity of the company NOT trading against customer orders.

We definitely have more room to grow, but I feel we are on the right track. With feedback like yours, you make it possible for us to be aware of our flaws. Your words, kind or negative, are very important to us. And yours in particular seem to be very valid. I appreciate the feedback.

Andy

[FXman989]

Longtang,

Hit me on PM if you want the IB you are looking for. NFA registered and all.

FXman

[longtang]

Thank you Andy.

I do appreciate your repsonse. This is just a quick note. I will post a bit more when I get home. But, let me just say that the reason I got so frustrated (ie I got so emotionally invested in the whole TTO situation) was that I really did want to make EFX work for my needs.

I do understand that EFX is one of the honest ones where my orders to into the real interbank market [As opposed to going into some bucket shop]. And I wanted to trade in the real interbank market. [Believe me, I have read Jesse Livermore's book several times, and I do understand the difference between a broker and a bucket shop. Given a choice, I would definitely want to trade with a real broker.]

So, I tried very hard to give EFX feed back about their TTO's. And I let myself get so frustrated because I really wanted to love EFX. I just wanted EFX to return that favor.

Anyways,
I am glad you are hearing my feedback. I do hope that EFX's platform could improve. You guys have a good business model and I do understand why it is technologically difficult to solve a problem like the TTO. For, you guys are straight through brokers without a dealing desk.

Anyways, I will post more when I get home. But, I just wanted to say that I appreciate your listening to my feedback.

longtang.

[TraderPierre]

I would like to know who takes other side of my 10k trade, surely not a bank?????? I think EFX is counterparty to every trade, no? They offset their exposure and risk on interbank, sure, but not STP of every trade.