Alex Bobrov
Today most forex traders effect successful trade within ECN system − electronic communication network that provides access to interbank market. As a rule, in this reference deals are effected by best prices for traders, based on the analysis of market depth, where ECN user sees several current suggestions from largest providers. Leading world banks, largest financial companies, and institutional brokers perform the function of liquidity providers.
Advantages of ECN
Undeniable advantage of ECN is the fact that clients’ orders are processed in a fraction of a second, there are no requotes, and slippings, if such happen, are not only negative, but also positive. Besides, ECN participants work with large trading volumes, which stipulates growth of their income. Some companies start lowering spreads and size of commission fees due to the fact that several liquidity providers are available within the system along with other market players, with which deals may also be effected.
For example, these days one of the lowest spreads is suggested by international broker company FXOpen, which is famous for being the first to make a revolutionary breakthrough of providing access to work at ECN not only to owners of large-scale capitals, but also to beginners in Forex trade. In particular, the broker has introduced a unique opportunity of working at interbank market via popular plaftorm MT4. (For more details about the innovation see “Market Leader” article “FXOpen ECN – Freedom and Comfort for Every Trader”).
“This great opportunity has already been used by thousands of traders, including those from Russia and CIS countries,” says director of FXOpen NZLimited Denis Peganov, “most of them effect rather successful trade on the basis of our company’s exclusive technologies, thus gaining stable profit. According to them, it has become possible not only to work at interbank market via МТ4 with minimal expenses and risks, but also to gain income by means of such innovative technologies of the company as PAMM ECN service. This type of account is attractive for investors, for they may invest their own means on favourable conditions and count on gaining income, depending on how successful the trading strategy of PAMM account manager is”.
“Investors regularly gain income, which is much higher than that from bank deposits; the income is automatically divided between managers and investors, which eliminates any misunderstandings. At the same time, investors do not have to do anything on their own, for everything is done by PAMM ECN account manager. What is more, this account accepts, among others, use of scalping methods and robots, which is not accepted by most other brokers”.
Trader hrenfx may be called a “live” example of effective work with PAMM ECN accounts of FXOpen. “It is currently the best of TOP-10 PAMM accounts of our company,” explains Denis Peganov, “the trader shows rather impressive trade at PAMM ECN – today the earning capacity of his account amounts to 823 228.54 percent, and maximal relative earning capacity − to 12 585 296 percent. It is interesting that hrenfx has reached such impressive results by trading via algorithms.”
The trader’s statistics is the following:
The “Market Leader” has met the trader and found out the secret of his successful work, as well as how helpful FXOpen services are in reaching such high results at Forex.
Hrenfx: Most Difficult is Thinking on Your Own
As stated by most successful PAMM account manager of FXOpen, he has gained his first 1 000 percent almost at once, as soon as he started trading at Forex market. This happened in 2006, when the trader started with only several hundred dollars. At present hrenfx’s personal capital amounts to 5 000 dollars. It is interesting that “the first 1 000 percent” were received in FXOpen…
“Market Leader”: Did you have negative results at that time?
Hrenfx: Yes, I did. Two days after a PAMM account was opened, I noted a drawdown of almost 90 percent. Let me admit that in this reference I’ve made some mistakes on my own too. Within some time, I’ve managed to solve some problematic issues, whereas the company, having paid due attention to my recommendations, has eliminated technical failures and considerably improved the service in general.
“Market Leader”: Have you further approached trade at PAMM ECN carefully or, as the word is, “gunned away into the career”?
Hrenfx: Hard to say… By trading within the company I have subjected the whole ECN system of FXOpen to real stress testing – a vast flow of trading orders for platform MT4, loading with serious trading turnovers, etc. This enabled quick finding and almost instant elimination of weaknesses within the system. The lion’s share of work was to be performed by technical service of the company; without its understanding and assistance I would have probably never reached current results. I am thankful to the broker for this.
“Market Leader”: If this is not a “military secret”, which trading strategy do you use?
Hrenfx: Let’s say, revealing market inefficiencies is my strategy, where statistics, confidence intervals, etc. are the key factors. Therefore, I often effect over 1 000 deals per day and give over 100 000 trading orders.
“Market Leader”: Which advantages of ECN FXOpen do you use most frequently?
Hrenfx: I use the great opportunity of displaying requests in Level2 ECN (glass of requests). Accordingly, I trade only by limiting trading orders, sometimes performing the role of institutional market-maker by suggesting prices that are better than those suggested by banks. This enables to instantly snatch liquidity of own ECN and get best requests from STP without slow mediators, such as platform MT4, thus avoiding negative slipping. This also enables one to compensate for the major part of commission fee by means of frequent positive slipping. By the way, unlike many other brokers, FXOpen always returns traders positive slippings in their actual size. This is another considerable advantage of my work on AMM ECN of the broker.
I would also like to admit that receiving information from the “glass of requests” in real-time mode and with an opportunity to calculate liquidity is a significant factor of successful “interbank” trade provided by FXOpen. Besides, the broker has provided the service of working with extreme hundred ticks with volumes and millisecond timestamp.
“Market Leader”: What currencies do you prefer trading?
Hrenfx: Different, depending on the situation. I often trade synthetic currencies.
“Market Leader”: You have shown fantastic earning capacity of 12 585 296 percent by trading on PAMM ECN. What is your secret?
Hrenfx: Everyone has one’s own understanding of success. I had to pass certain stages of becoming a trader. Much of what I’ve planned to do has not yet been effected. When holding constant market research one starts getting tired even despite algotrade and fully automated trade, which I support and use. Yet, it seems to me that the ability to do the most intricate thing – thinking on one’s own, is the secret of successful trade at forex.
“Market Leader”: You have mentioned algotrade. Please, tell us about its features.
Hrenfx: Almost any algotrader has own research and trading infrastructure: collection and storage of market information, back-tester, visualization, logging of numerous trading characteristics, etc. Creating all this on one’s own is useful, on one side, but thief of time, on the other. When there is an infrastructure, most time is spent on different research. In this reference, every trader has his own methods and approaches.
As a rule, an algotrader becomes a hostage of his own strategies, which are hard to escape from. Therefore, it is useful to broaden one’s outlook by new approaches and views on the market, which I try to do all the time.
“Market Leader”: In you opinion, what is the source of successful trade at forex market?
Hrenfx: It seems to me that in this reference trading conditions are most important, namely, price formation, liquidity, size of spreads and commission fees, broker’s reliability, technologies of financial markets access that are provided by the company, etc. At the same time, trader’s personal psychological features, his tolerance to unexpected market trends, and understanding of risk management often play a crucial role. Therefore, in my opinion, individual practice of financial market participant and reliability of his broker are the main constituents of successful activity at financial markets.
As far as we can see, owing to unique technologies of FXOpen company, PAMM ECN accounts in particular, almost any trader may reach great success within a short time, not only for himself, but also for its investors. Attracting investors’ means is a guarantee of large trading volumes and, consequently, higher income. “Our technologies and trading conditions enable traders, who want to become managers of large investors’ capitals, to realize their urge. By using the company’s ECN system one may reach stable and high results at forex market,” concluded Denis Peganov.
Alex Bobrov
