Something Interesting in Financial Video February 2017

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Sergey Golubev
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Sergey Golubev  
Trading and training video (from youtube for example) about forex and financial market in general. 

Please upload forex video you consider as interesting one. No direct advertising and no offtopic please.

The comments without video will be deleted.
Sergey Golubev
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Sergey Golubev  
Gold Traders Fighting Equity Rally Euphoria - Kitco's Peter Hug

Gold prices fell on Wednesday as the Dow hit 20,000, among hopes that newly-elected U.S. President Donald Trump will unleash growth-friendly spending policies. Gold prices were trading solidly lower and back below the key $1,200 level in late-morning action Wednesday. 'Gold managed to tick up to the $1,218 level yesterday before the rally in the equity market ended the momentum,' said Peter Hug, global trading director for Kitco Metals. 'Capital may chase the print in the Dow, at the expense of protection. Euphoria, even though possibly misplaced, or at a minimum premature, will continue to increase the risk appetite for capital and prove a negative for gold,' he explained. Hug added that options expiration tomorrow may keep gold trading around the $1,200 print, but the pressure remains to the downside. The $1,197 level now becomes the support line, with $1,208 overhead resistance, he said.

Gold Traders Fighting Equity Rally Euphoria - Kitco's Peter Hug
Gold Traders Fighting Equity Rally Euphoria - Kitco's Peter Hug
  • 2017.01.25
  • www.youtube.com
Gold prices fell on Wednesday as the Dow hit 20,000, among hopes that newly-elected U.S. President Donald Trump will unleash growth-friendly spending policie...
Sergey Golubev
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113972
Sergey Golubev  

High Frequency Trading

Dave Fry, founder and publisher of ETF Digest, and Steve Hammer, founder of HFT Alert, discuss high frequency trading operations, fundamentals, the difference between algorithmic trading and high frequency trading, fluttering, latency and the role high frequency trading had in the May stock market flash crash in 2010.


Sergey Golubev
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Sergey Golubev  
This video is about 4 minute. CNN's Maggie Lake gets a rare look inside the super-fast trading industry.

Sergey Golubev
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Scalping

All the ins and outs on scalping the Forex market. May Chris dives into the world of Scalping where he explains in great detail how this style of trading can be accomplished in the Forex market. This live webinar not only clarifies how a trader can scalp but also provides every Forex trader with a great guidance and extra tips.

 

Sergey Golubev
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Sergey Golubev  
AN INTRODUCTION TO ECNS

This video provides an introduction to electronic communications networks (ECNs), systems that allow buyers and sellers of stocks to trade directly without an intermediary.

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Most forex traders participate in the forex market with forex brokers. There are mainly two types of forex brokers: market makers and electronic communications networks (ECNs). In this article we want to introduce the latter type of brokers, the ecn forex broker.

What is an ECN forex broker?


ECN forex broker is a financial expert that provides the clients with direct access to other forex participants in the currency market by using electronic communications networks (ECNs). Unlike market makers, which always trade against their clients to make profit, an ECN forex broker only creates opportunities of trading between forex traders.

How does an ECN forex broker work?

The ECN forex brokers provide a medium by passing on the prices for different market participants such as banks, market makers and other traders in the market. Then the best bid/ask quotes will be displayed on the trading platforms based on these prices. ECN forex brokers also serve as counterparties to forex transactions, but it is a settlement that they operate on instead of pricing basis. While fixed spreads are offered by some market makers, spreads of currency pairs can be very different, determined by the trading activities of the currency pair. In active trading periods, sometimes you cannot get ECN spread at all, especially in those very liquid currency pairs such as the majors (EUR/USD, GBP/USD, USD/JPY, USD/CHF) and some currency crosses.

Pros and cons of the ECN forex broker

The ECN forex broker has both advantages and disadvantages. The pros and cons of the ECN forex broker are as follows.
The pros of the ECN forex broker can be presented in following aspects.
Traders can usually get better bid/ask prices for they are derived from multiple sources.
At certain time traders may trade on prices with no spread or with only very little spread.
Genuine ECN forex broker will pass on the orders to a bank or other trading participants on the opposite side of the transaction instead of trading against the traders.
It is very likely that the prices on the ECN forex broker are more volatile.
Traders can take on the role of market traders to other traders on the ECNs since they can offer a price between bid and ask.
The cons of the ECN forex broker can be presented in following aspects.
Many ECN forex brokers do not provide integrated charting or new feeds.
Some trading platforms are not so easy for traders to use or operate.
Since there are variable spreads between the bid and the ask prices, it may be difficult to calculate stop-loss and breakeven points in pips in advance.
Forex traders are obligated to pay commissions for each transaction.

It is obvious that there are both pros and cons of an ECN forex broker. Traders have to take many factors into consideration when choosing a forex broker.


Sergey Golubev
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Sergey Golubev  
How to Tell if Your Broker is Trading Against You
  1. In this video, we're focusing on forex and CFD brokers; this discussion does not apply to stocks and futures brokers.
  2. The simple truth is that most forex and CFD brokers are trading against their clients. The details in how this is accomplished vary greatly from broker to broker. Broadly speaking, we can say there are two types of brokers: A Book brokers and B Book brokers.
  3. A Book brokers may technically be trading against their clients in that they are taking the opposite side of the trade, but they generally are taking a risk neutral approach to the market and are looking to immediately offset the trade. So they are not trading against their client in spirit, only in technicality.
  4. B Book brokers will choose what positions of their clients they wish to offset. As such, they are willing to take a directional position in the market, and thus may be trading against their clients in a more material way. For instance, suppose the B Book broker wants to take a long Euro position in the market. To do this, they may not offset the short Euro trades their clients have put on; rather, they will simply take the other side of these trades.
  5. A Book and B Book brokers can both run into big problems -- for themselves, and in turn, their clients -- if the larger banks and brokerage firms they offset orders with no longer take positions. This risk is known as liquidity risk. We saw liquidity risk have a devastating impact on both A Book and B Book brokers when the Swiss National Bank unpegged the Swiss Franc from the Euro, resulting in a huge move in a matter of minutes.
  6. As a general rule of thumb, the more illiquid instruments a broker offers and the more leverage they offer the more likely they are a B book broker whose positions in the market are a significant part of their business. These types of brokers are giving signals they are comfortable with liquidity risk, which means they are comfortable taking the other side of the customer's position.
  7. B Book brokers have a conflict of interest that makes it seem like they are dishonest and unethical, but they can offer their clients significant benefits that A Book brokers cannot. Namely, their willlingness to take on liquidity risk means they can offer prices and trading opportunities that would otherwise not be available. They bundle their customer orders to customers with lower trading costs, and offer trading free from restrictions like the pattern day trader rule or any uptick rule. As such, B Book brokers are not entirely bad or useless. What matters is whether you value the advantages they offer and that you trust them not to abuse their position as your counterparty.
  8. You can ask your broker directly about their dealing desk policy, though many will be coy about their status. This is largely because they feel uncomfortable about admitting their status as the counterparty to your trade, and because they generally do not educate their staff in the nuances of how they operate and make money.


Sergey Golubev
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Sergey Golubev  

Forex Broker Types - MM,NDD,STP,ECN

This is small 10 minute education video about the following: the difference between Forex Broker Types - MM,NDD,STP,ECN


Sergey Golubev
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Sergey Golubev  
The Role of the Retail Forex Broker

Before the internet, very few individuals traded foreign exchange as they could not get access to a level of pricing that would allow them a reasonable chance to profit after transaction costs. Shortly after the internet became mainstream however several firms built online trading platforms which gave the individual trader a much higher level access to the market. The internet introduced two main features into the equation which were not present before:

1. Streaming Quotes: The Internet allowed these firms to stream quotes directly to traders and then have them execute on those quotes from their computer instead of having to deal over the phone. This automated trade processing, and therefore made it easier for firms to offer the ability to trade fx to the individuals and still be profitable.

2. Automatic Margin Calls: What is not so obvious but what was perhaps even more key is that the internet allowed an automated margin call feature to be built into the platform. This allowed firms to accept cash deposits from clients instead of having to put them through the process of signing up to trade via a credit line. As we discussed in our last lesson it is very difficult to get a credit line to trade FX and for those who do it is a lot of paperwork and hoops to jump through before they can begin trading. This would have made it impossible to offer FX trading to smaller individual traders as the cost involved in getting them set up to trade would not be worth it.

As the electronic platform allowed clients to deposit funds and then automatically cut them out of positions if they got to low on funds, this negated the need for credit lines and made the work to get an individual account open well worth it to the forex broker from a profit standpoint.

If you don't understand all the ins and outs of margin at this point don't worry as this is something that we are going to go into much more detail on in a later lesson.

For now it is simply important to understand that what these firms did was take all the traders who were not big enough by themselves to get access to good pricing and routed their order flow through one entity that was. This allowed these firms access to much tighter pricing than would otherwise have been possible which was then passed along plus a little for the brokers to the end client.

So now you can see why although the forex market has been around for a relatively long period of time, individuals have only started to trade the market over the last few years.

Anther key thing that it is important to understand here is that the larger a firm gets in terms of trading volume, the greater access that firm has to tighter prices and liquidity and the more likely that firm is to be able to pass on better pricing and execution to their clients.

Sergey Golubev
Moderator
113972
Sergey Golubev  
Why Choosing a Forex Broker is so Confusing

Learn how to sort through the chaos and confusion on the web to learn what forex brokers are best for individual currency traders.


Sergey Golubev
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113972
Sergey Golubev  
Choosing a Forex Broker: Regulation and Financial Stability

What forex traders need to consider regarding the regulatory environment of the forex broker they trade with.


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