👉 Trade with our Sponsor Broker: Trade Nation www.financial-spread-betting.com/ccount/click.php?id=95 Trade sensibly! 81.7% of retail investors lose money. 👉 We are seeking more contributors who can produce great video educational content about trading for our channel. If you think you have what it takes please get in touch by sending a message to traderATfinancial-spread-betting.com (remove the AT and substitute by @). 👉 It seems a lot of our viewers are non-subscribers. Make sure to subscribe to our youtube channel as we upload regular videos! If you hit the “Bell” icon (🔔) you will receive a notification on youtube every time that we upload a video on our channel. Bell icon hitters are super fans of our channel 🥰
There's only one hanging question... Why would any broker want their traders to lose? When traders lose, they give up, and when traders give up, brokers lose business
I love this man especially the way he speaks and all. But for those of you who are in Asia and have difficulty to understand him speak. You could probably slow down the playback speed to 0.75x 😁
Thank you for the awesome explanation! One thing I would like to get clarified if possible: how come brokers are able to leverage all those individual trader's deposits and still make a profit from it? It seems to me that using leverage to "borrow" money from the brokers would put brokers at a very high risk if the price moves against the trader's forecast. I understand most of the trades get cancelled-out by traders on both sides (buying vs selling), but by using more money than is actually deposited on trader's accounts shouldn't that make the broker lose money? Still can't figure out how that part works.
They charge you interest to 'lend' you that money - it is called FINANCING and it amounts to extra revenue for the broker. When you use that extra buying power you are typically charged 2.5% over the central bank's interest rate (or over LIBOR if in the UK)
am I missing something here...? It is commonly said that the broker hedges your trade to avoid risk to themselves. However it does not seem possible for the broker to avoid risk by hedging though right? For example if I take a buy trade and the broker takes the sell opposite trade and I am successful and profit from the trade, all the broker has is the sell trade which is a loss. So how does this cancel risk for the broker?
Hi! One of my friends joined the fx company as a sales executive, he told me a strange thing that he gets paid both on In and Out of a trade e.g if the eurusd spread is 1 pip he gets paid a fixed percentage of 20 Dollars. Is this possible? how broker charge us spread twice? Please explain. Big time fan, long time follower. Thanks
If dealing desk broker takes the other side of trade isn't that possible lose if his client were right? For example if some trader buys some currency and the broker takes the opposite side(sell) and price rises does that mean that broker lost his money?
Doesn't work that way. Broker may get X number of clients that are long and Y number of clients that are short on an instrument. The broker's job is to mitigate the exposure so they will hedge any 'extra' exposure beyond their risk parameters.
@@ukspreadbetting What if there is much more clients who are long than those who are short? And what if broker doesn't match them but he takes the opposite side of trade?
This is at he discretion of the broker how much action they hedge and where. Some brokers hedge more, some less. This shouldn't really make any difference to you at the end of the day since to be able to transact you need a counterparty (whether this is the broker or another person selling you the shares you are buying say). What is important is that the broker is properly regulated and treating you fairly.
If their 'book' is balanced some clients will win while others will lose. Otherwise they either hedge their excess exposure using futures/options or go to the underlying exchanges directly.
Dealers also makes money in the rollover fees that they charge and they can change the fees anytime they want. Most dealers today are so greedy that they charge a rollover fees on both BUY and SELL positions.
They charge interest on 'short' positions because the Libor Rate/Central Bank Rate is very low. A good broker will charge you 2.5% as an overnight commission fee. (if your broker charges you more switch). So deducting this from the central rate still leaves a negative rate.
👉 Trade with our Sponsor Broker: Trade Nation www.financial-spread-betting.com/ccount/click.php?id=95 Trade sensibly! 81.7% of retail investors lose money.
👉 We are seeking more contributors who can produce great video educational content about trading for our channel. If you think you have what it takes please get in touch by sending a message to traderATfinancial-spread-betting.com (remove the AT and substitute by @).
👉 It seems a lot of our viewers are non-subscribers. Make sure to subscribe to our youtube channel as we upload regular videos! If you hit the “Bell” icon (🔔) you will receive a notification on youtube every time that we upload a video on our channel. Bell icon hitters are super fans of our channel 🥰
There's only one hanging question... Why would any broker want their traders to lose? When traders lose, they give up, and when traders give up, brokers lose business
I can tell it's going to be a good one when I see a cartoon character on the whiteboard. :D
The amount of knowledge I have learned from this guy is over 9000
I love this man especially the way he speaks and all. But for those of you who are in Asia and have difficulty to understand him speak. You could probably slow down the playback speed to 0.75x 😁
wow... now I know how to make money in the right way... thank you
Your terminologies are for people who are used to the market
Thank you Mark. You answered a nagging question I had regarding Brokers. Great channel.
all i know is that they make a lot more than i do
Thank you for the awesome explanation! One thing I would like to get clarified if possible: how come brokers are able to leverage all those individual trader's deposits and still make a profit from it? It seems to me that using leverage to "borrow" money from the brokers would put brokers at a very high risk if the price moves against the trader's forecast. I understand most of the trades get cancelled-out by traders on both sides (buying vs selling), but by using more money than is actually deposited on trader's accounts shouldn't that make the broker lose money? Still can't figure out how that part works.
They charge you interest to 'lend' you that money - it is called FINANCING and it amounts to extra revenue for the broker. When you use that extra buying power you are typically charged 2.5% over the central bank's interest rate (or over LIBOR if in the UK)
is there any chance you’re able to produce a video on fading a trade (in depth), great video 👍🏻 📈
yes a video on that one is coming soon :)
here it is Fading Extremes in Price
th-cam.com/video/v90Ul7QGLT4/w-d-xo.html
then the question is how Liquidity Provider (LP) make the profit ?
Don't part with your illusions;when they are gone you may still exist, but you have ceased to LIVE...love great's from Germany
am I missing something here...? It is commonly said that the broker hedges your trade to avoid risk to themselves. However it does not seem possible for the broker to avoid risk by hedging though right? For example if I take a buy trade and the broker takes the sell opposite trade and I am successful and profit from the trade, all the broker has is the sell trade which is a loss. So how does this cancel risk for the broker?
Thanks for the info, that was very interesting. I always wondered how it worked.
Great, thank you! Very knowledgeable!
I thought the broker was just a middle man, well that sucks if they are the ones you're dealing with
I'm from india ,i can't get what you said sometime ,so speak slowly sir, I'm following your channel for 2 years
The book B type brokers takes more risk to get vertical spread on client exposure.
Hi what do you think of FX pro as a broker
My understanding is that they are regulated but operate using a B Book model so they could be trading against you at times?
Great video!
Don't brokers rely on traders going broke to profit
Hi!
One of my friends joined the fx company as a sales executive, he told me a strange thing that he gets paid both on In and Out of a trade e.g if the eurusd spread is 1 pip he gets paid a fixed percentage of 20 Dollars. Is this possible? how broker charge us spread twice? Please explain.
Big time fan, long time follower.
Thanks
He could be getting a percentage of the spread (say 20%) but it doesn't add any costs to you. The spread for you as a client remain the same.
Sir are talking about B-BOOK brokers? Or A
what are your comments on avatrade. can they be trusted?
I believe they are legitimate, however having said that I've never traded with them.
Can anybody explain me what if Dave takes trade with 2000 lot i didn't understand what is happening then.
If dealing desk broker takes the other side of trade isn't that possible lose if his client were right? For example if some trader buys some currency and the broker takes the opposite side(sell) and price rises does that mean that broker lost his money?
Doesn't work that way. Broker may get X number of clients that are long and Y number of clients that are short on an instrument. The broker's job is to mitigate the exposure so they will hedge any 'extra' exposure beyond their risk parameters.
@@ukspreadbetting What if there is much more clients who are long than those who are short? And what if broker doesn't match them but he takes the opposite side of trade?
This is at he discretion of the broker how much action they hedge and where. Some brokers hedge more, some less. This shouldn't really make any difference to you at the end of the day since to be able to transact you need a counterparty (whether this is the broker or another person selling you the shares you are buying say). What is important is that the broker is properly regulated and treating you fairly.
@@ukspreadbetting Ok but my question was how they don't lose money if we take the profit since they are the opposite side
If their 'book' is balanced some clients will win while others will lose. Otherwise they either hedge their excess exposure using futures/options or go to the underlying exchanges directly.
Dealers also makes money in the rollover fees that they charge and they can change the fees anytime they want.
Most dealers today are so greedy that they charge a rollover fees on both BUY and SELL positions.
They charge interest on 'short' positions because the Libor Rate/Central Bank Rate is very low. A good broker will charge you 2.5% as an overnight commission fee. (if your broker charges you more switch). So deducting this from the central rate still leaves a negative rate.
I understood nothing here 🤦♂️
cool interessant
Great content, which broker do you recommend?
See www.financial-spread-betting.com/spreadbetting/compare-spreads.html