Copy-Trading: Any explanation for these slippages?

[adenauer692]

Hello everyone,

Within the subject of Copy-Trading, I would like to tell you what seems to be an error in the list of slippages between the provider's account and the possible brokers that a subscriber can use.

I have not seen this detail in the exhaustive FAQ list on this subject: https://www.mql5.com/en/forum/10773#q23

It really strikes me that if the subscriber does not choose the exact same broker as the provider, he does not have the best slippage on the list. Is this a bug?

If it's not an error, please, why is it?

I am going to give 2 examples that seem "scandalous" to me of what I am saying...

Example 1:

As the Broker used by the provider is Weltrade-Real, logic tells us that if we want to have a slippage of 0 with respect to the provider's account, we must use Weltrade-Real precisely. But... what is my surprise when I see, precisely, Weltrade-Real in the last position of that list and with the worst slippage of all:

Please, is there any explanation for this or is it just a bug?

I don't know if it's a bug or not, but it seems somewhat systematic:

Example 2:

Here we see that, against all intuition, if a subscriber chooses the same broker as the provider, there are 19 faster brokers than the one he has chosen since the provider's broker is in 20th position on the list.

Please, what is this strange phenomenon due to?

Of course, it seems to me an important detail, because a minor or major slippage will mean a good or bad copy of the provider's signal.

...Oh! and I take this opportunity to wish you all a Merry Christmas and a 2023 full of successful trading!

[Fernando Carreiro]

It is not an error. Forex is not a centralised exchange. Each broker has their own data feed and liquidity providers.

So, obviously a Signal based on one broker's data feed will not necessarily match that of a another broker.

This is why it is usually recommended that to follow a signal, it is best to either select a signal on the same broker as yours, or to open an account on the same broker as the signal provider.

[Fernando Carreiro]

However, the quality of the Broker, and the connection speed to that broker also affects the slippage.

So if a signal has several customers, all on the same broker as the signal provider, but with slow computers or slow or bad internet connections, then they will suffer large slippages.

Even if on the same broker, these metrics reflect on that signals statistics.

[adenauer692]

Thank you Fernando for your explanations. I find your 2nd explanation very explanatory of what may be happening.

But it is really surprising that Weltrade-Real users have such overwhelmingly slow internet connections!

I would like to elaborate on 2 more points, please:

1. In view of these contradictory slippages, what is the real reason why it is "recommended" to use the same broker as the provider to copy signals?

2. It is said that these slippages are measured in points. But what does that multiplicative factor that accompanies slippages mean? (for example, in the last photo I sent we see that IC MarketsSC-MT5-2 has a multiplicative factor of x 25193)

[Sergey Golubev]

adenauer692 #:

Thank you Fernando for your explanations. I find your 2nd explanation very explanatory of what may be happening.

But it is really surprising that Weltrade-Real users have such overwhelmingly slow internet connections!

I would like to elaborate on 2 more points, please:

1. In view of these contradictory slippages, what is the real reason why it is "recommended" to use the same broker as the provider to copy signals?

2. It is said that these slippages are measured in points. But what does that multiplicative factor that accompanies slippages mean? (for example, in the last photo I sent we see that IC MarketsSC-MT5-2 has a multiplicative factor of x 25193)

About multiplicative factor:

Forum on trading, automated trading systems and testing trading strategies

how to find slippage my own broker?

Eleni Anna Branou, 2022.01.28 16:41

If you mean how to find the slippage of your own broker, when trying to subscribe to a MQL5.com signal, go to the Slippage tab of the signal you want to subscribe and search for your broker/server.

Next to it you will see 2 values, for example 1.52 x 340

The first number is the average slippage (price difference) in points of the 340 already copied trades with this specific broker/server setup.

The smaller this value is (green and upper yellow values) the best, if your broker is within the orange and red values, it is advisable to search for a better broker/server setup in order to copy this signal.

If you are asking about slippage in general, there isn't anywhere you can find it, slippage is the price distance between the desired level of a trade with the actual price level, the trade was opened or closed.

For example the quoted price of EURUSD at the time you press the buy or sell button is 1.11500, but due to quick price movement at the time of the placement of the trade, your trade is actually opened at 1.11510, these 10 points of difference is called slippage.

[Fernando Carreiro]

adenauer692 #: But it is really surprising that *** users have such overwhelmingly slow internet connections!

As I stated, "... the quality of the Broker ...", but further discussion would be against forum rules, so I can elaborate no more than that.

adenauer692 #: 1. In view of these contradictory slippages, what is the real reason why it is "recommended" to use the same broker as the provider to copy signals?

I already answered that with my first post #1.

adenauer692 #: 2. It is said that these slippages are measured in points. But what does that multiplicative factor that accompanies slippages mean? (for example, in the last photo I sent we see that IC MarketsSC-MT5-2 has a multiplicative factor of x 25193)

It is my understanding, that it is the frequency (see below):

Forum on trading, automated trading systems and testing trading strategies

Signal Slippage?

Eleni Anna Branou, 2019.05.15 15:37

It means that this server has been used 422 times for copying this signal, with an average of 1.88 points slippage per trade.

These values are only indicative and not always trustworthy, but yes 1.88 points slippage is a low value.

If you click on a line it shows a breakdown of that slippage.

[adenauer692]

Thank you Serguéi for your clarification on the multiplicative factor (you are always very precise). And thank you Fernando for your contribution that corroborates the previous one.

...

Sorry Fernando, in your first post I did not understand the real reason why it is recommended to use the same broker as the provider's: seeing the slippage it even seems contraindicated to use that same broker. So I still don't understand that deep reason. If you are so kind as to explain it to me in another way, I will appreciate it (it is also possible that it is because of the language translator that I use).

It also surprises me a bit when you say that there is a limit in this forum to deepen the knowledge... Please, in what terms is this limit established? Can you give me the corresponding link of that standard? (I wouldn't want to transgress it either).

[Fernando Carreiro]

adenauer692 #: Sorry Fernando, in your first post I did not understand the real reason why it is recommended to use the same broker as the provider's: seeing the slippage it even seems contraindicated to use that same broker. So I still don't understand that deep reason. If you are so kind as to explain it to me in another way, I will appreciate it (it is also possible that it is because of the language translator that I use).

As I stated, Forex is not a centralised exchange. There is always a difference in quote prices between different brokers because they use different data feeds and liquidity providers.

For example, at the sample time of "10:00", broker "A" may have a EURUSD quote price of 1.1234 but the price at broker "B" is 1.1239. So if a Signal provider on broker "A" opens a trade at that exact time and price, and a subscriber on broker "B" copies the trade at the same time, it will open at 1.2139 instead of 1.2134, and will suffer 5 pips slippage.

Do you understand it better now?

adenauer692 #: It also surprises me a bit when you say that there is a limit in this forum to deepen the knowledge... Please, in what terms is this limit established? Can you give me the corresponding link of that standard? (I wouldn't want to transgress it either).

Discussing specific brokers, or specifics about them, is against the forum rules. Only general discussions about brokers is allowed as long as no names or specifics are mentioned.

[adenauer692]

Now yes. Very good explanation Fernando. Thank you!

I also fully understand the spirit of that rule. Indeed, it seems to me a very convenient rule. Thanks again.

All the doubts that I raised at the beginning of this thread have been very well clarified.

It is a pleasure to belong to this community, where information flows with such speed and smoothness!

[Fernando Carreiro]

adenauer692 #: Now yes ... Thank you!

You are welcome!

[adenauer692]

Serguéi Golubev #:

Sobre el factor multiplicativo:

About the Multiplicative Factor you say that it is "the average in points of the 340 transactions already copied with this specific broker-server configuration.

But I see that these measures are also carried out on signals with 0 followers (I think it is not necessary to insert images...)

But if there are 0 Followers, there cannot be "transactions already copied"... Because no follower has copied them.

So how are those slip measurements actually made?

Have I made a mistake in my logic chain? Did I understand something wrong?... Thank you.