I understand people trading smaller time frames, when trading full lots ,mini lots, or micro lots.(ie. fixed lots) A stop loss on a 240 chart, maybe on the last swing before entering, could be some 40 pips, and that could be a big $ risk for most of us. That is the reason why I use OANDA, the only broker with no fixed lot´s. So no mattter what time frame, I will set my stop where I want, and then adjust my lot size to the cent,meaning, if I want to risk 12, 50 EUROS, I can adjust my lot size exactly. Having said that: OANDA IS A BUCKET SHOP, they…
Let’s not start trashing and reviewing brokers here either. Anyone who has been in this business for a while starts out blaming brokers for all kinds of things. Yes, there are disreputable brokers, and traders may not like the various ways all brokers have of extracting profit from us, but we can’t do what we do without them.
Most brokers offer different “products” to their clients in the form of types of accounts. If you have a variable spread account, spreads are lower but you are charged a commission, the size of which is calculated in relation to the size of your exposure on that trade. If you have a fixed rate account, the spreads are wider but there is no commission. Swap fees, carry-over fees, or “financing” on trades held open into the next calendar date are charged by all brokers. Chalk it up to the price of doing business. If you listen to some malcontents, they sound like any entity that forces them to pay for a service they provide should be considered a criminal. It’s just like buying a car or a house or something where you need a loan. There are reputable lenders and there are loan sharks. There are different terms of the loans sometimes disguised in legal language very few people understand. There are different rates and different terms and rules for the life of the loan. Some are favorable, some not so favorable.We just have to sift through the riff-raff to find the one who won’t try to kill us financially.
It is normal for traders, especially inexperienced traders, to internalize what happens in the markets and take certain market events as personal attacks. We all did it, we’re all doing it, and we all will do it. We have to blame something or someone for our lapse in judgement. If it’s not the broker it’s the banks. or the government, or an ex-spouse, or the platform we’re using, or God, God is my favorite. God always gets an earful of vindictive language when I lose too much or too often. God hates me, that’s why I suck at trading. I haven’t got a prayer. It’s a giant conspiracy. Everybody wants apiece of me. It’s not my fault. Yeah. Right. OK.
No matter who your broker is, spreads widen at the same times every day and for the same reasons. When there s huge uncertainty in the market the spreads get wider. Spreads increase: After New York Close till about the 2nd hour after the Sydney Open. / On the first Open of the week, Sunday or Monday depending on where your feet are planted at the time, also Sydney Open, until about the 2nd hour of the session. / Major news spikes / Certain known-in-advance political events such as a scheduled vote for a major change in that country’s policies / sudden governmental market intervention….That’s not your broker, it’s across the board. Your broker may try to squeeze an extra pip or two out of us here and there, but no matter who you trade with, spreads fluctuate for all traders at certain times. Brokers have to pay their liquidity providers, the banks. The cost is passed on to us. Retail is retail no matter what business you’re in.
“It took me a lifetime to learn to paint like a child.”(Pablo Picasso)