Thread: Most suitable broker for news trading

Hi all. I likely have a sense that this topic was discussed to death. I have seen some topics about it around here. Anyway, forgive the newbie for producing an additional thread like that but I actually needed to since I couldn't find the answer I was searching for.

As long story short, I am searching for a broker that would be suitable for news trading. I understand the majority of the retail brokers aren't the best in regards to news trading however if you are news trader and if you'd experience with a small number of brokers out of all, which are the very best for the news? Or the least?

And here's what I am searching for a broker. Beginning from important.

1. Smooth platform functioning before and throughout the news. No freezing, crashing or other garbage. This is crucial. I believe freezing for few secs to 10-15 normal but freezing just before and through the news for few minutes isn't acceptable. Maybe for exceptionally volatile and important news like interest rate decision but maybe not for economic indiors like CPI, Retail sales, Trade balance, GDP etc..

2. No or minimum re-quotes.

3. Preferably ECN/STP with deep liquidity. Not shitty in disguise MM. The only exception would be a very great, I mean flawless MM that does not play any tricks with re-quoting, continuous negative slippage, intentional spread Growing etc..

That is it. That is all I need.

Additionally, I really do have my own collection of brokers that after doing lots of research, made me think opening account with them. The list would be: Dukascopy, Pepperstone and possibly IC Markets. Although I am not sure about the last one cause lately I have seen some very bad reviews. There's also LMAX and IB that I discovered are quite good but the minimum deposit is like 10k that I cannot afford right now.

Anyway, if you have experience with any of those brokers mentioned above, I'd really like to hear your ideas. And if you have your own recommendation, I'd really like to hear that.

Thank You.

The majority of the brokers aren't allowing to trade news coz it's risky for them. I also would like to have experience of trading news with suitable broker.
If anybody understands such, please, let's...

Originally Posted by ;

Hello all. I have a sense that this topic was discussed to death. I've seen some issues about it around here. Anyway, forgive the newbie for creating one more thread similar to this but I really needed to since I couldn't find the answer I was searching for. So long story short, I am searching for a broker that will be appropriate for news trading. I know the majority of the retail brokers aren't the best in regards to news trading however if you are news trader and if you'd experience with a handful of brokers, from all, which are the best for the...

In case you can't even afford $10K to trade, then I'd strongly suggest you to keep away from news trading since the possible losses because of the large spread and price swings resulting from the news particularly the NFP and the central bank rate decisions (just ask each of the traders that traded throughout the SNB crisis last year) could easily wipe out your account and then a few for any account size under $10K. And I'll tell you for news trading, the top brokers are LMAX and IB; they are the only ones that fulfill all three of your needs but unfortunately LMAX does not allow news trading that just leaves IB.

Originally Posted by ;

quote In case you can't even afford $10K to exchange, I would strongly suggest you to stay away from news trading since the possible losses due to the huge spread and price swings resulting from the news especially that the NFP and the central bank rate choices (just ask all traders that traded throughout the SNB meltdown last year) can easily wipe out the account and then a number for any account size below $10K. And I'll tell you for news trading, the top brokers are LMAX and IB; they are the only ones that satisfy all three of your requirements but unfortunately...

Thank you for the thorough answer. Just few things. What makes you think if an individual does not have 10k to exchange, he/she shouldn't exchange the news? I'll be honest. I am likely to begin trading using 1000$. That is the most I could afford at this time. I also think trading the news isn't too much different than normal trading. Yes, the market can be particularly volatile with huge price swigns like you said but..you will manage your risk and position size just like you usually do. Not over leverage your posture and you're going to be OK. Though my egy allows me to utilize high leverage since it's almost impossible to lose with it in the long term. Well, it's possile to shed but since winning rankings are 5 times bigger than losing ones a.k.a. 1:5 risk/reward ratio, it's a winning egy in the long term. But for the egy to use, the broker is critical. Spread is no issue for me. I've a way to circumvent this little bugger. And one more thing. If LMAX is true ECN, then why they don't let trading the news? As far as I know, true ECN brokers receive their fair share from traders via commissions. So they should be considering trader making money regardless of if he is news trader or not. It does not make any sense.

Because LMAX wants to protect their liquidity. Their LPs are quoting business liquidity with no last-look, consequently lmax is policing the flow for toxicity. If they wouldnt do this, many LPs would probably stop quoting there all together, impacting the majority of their normal clients.

As far as I understand that doesnt concern point-and-click traders however coloed HFT clients. On the other hand, they dont offset and trades or profits, but may ask you to cease trading with them.

Imagine if my trade quantity is no more than few lots each trade? Can they ask me to stop trading the news? Cause I don't believe such quantity would do some noticeable difference. Also, just how much can LMAX usually provide news traders before asking them to stop trading news events?

I dont know, just send them an email and ask.

Originally Posted by ;

quote Thank You for the detailed answer. Only couple of things. What makes you think if an individual does not have 10k to exchange, he/she should not exchange the news? I'll be honest. I'm likely to begin trading using 1000$. That is the most I can afford at this time. Also, I think trading the news isn't too much different than normal trading. Yes, the market can be particularly volatile with enormous price swigns like you mentioned but..you will manage your risk and place dimensions like you usually do. Not over leverage your posture and you're going to be OK. Though my egy permits...

The problem with news trading is that, the typical risk/reward ratio goes out of the doorway and there is no way to restrain it since 1) there is no way to predict just how much reduction can potentially result from an unfavourable news or economic amount. You think that can really have a 1:5 risk/reward ratio but when it is a really bad number, you could be facing 2:5 or 5:5 or worse 10:5 risk/reward ratio together with the previous one being the reduction entirely overwhelming winning and there is no method to forecast or predict that and every single news and economic amount differs. 2) It's further complied by the fact that you also have no control over liquidity which can worsen an already unfavourable risk/reward ratio because during news trading time. No matter bandwidth you see throughout ordinary trading times does NOT apply throughout news or economic amount times. Liquidity can dry up which means any mechanics that you put in place to control losses is also out of this doorway. Require the Jan.. 15 SNB crisis last year for example, when the explosive news hit, majority of the traders had stop-loss orders in place that when executed would have limited their losses into the risk/reward of their ratio of their selection. However, you know what happened? All the liquidity suppliers, aka those Big Banks decided to shut down their quote method and stopped implementing orders entirely for AN HOUR!! And the price just free-falled before they come back to quote prices, the EUR has dropped against CHF so much that it had been well out of their risk/reward ratio of those traders' alternative. The spread was several thousand pips!! Some of the traders that were actually on the right side of this market even ended in losses. Some traders were confronting ten's and million's dollars of losses. 1 trader was even confronting 100K's of losses and all they had was micro, mini-lot positions since they were little capital traders the same as you with just thousand or several thousand dollars of funds most in their account. And all of sudden they had been confronting ten's and million's dollars of losses.

This is the reason I say it isn't worth it to exchange news particularly if you are thinly capitalized. If you profit, you are not likely to profit much with those micro, mini-lot positions but when you drop, you could be on the hook for HUGE losses even from those very small positions. And this is exactly the same no matter which broker you go for, while it's MM or ECN because ultimately they all face the identical liquidity suppliers which control the market. Retail Forex isn't traded on a market where prices are determined by matched trades but set by negotiations between buyers and sellers in a trades and in these negotiations, guess who gets the bargaining power? Trillion-dollar financial powerhouse such as Deutch Bank or1000-trading funding retail traders like you? At least if you have more trading funds such as at least 5 amounts, you MIGHT and I can only say MIGHT be better placed to absorb some losses from those sudden moves but with just $1000, it is very dangerous and for just small potential profit should you compare to potentially HUGE losses.

, really well put! I only want to add something else on the top of that.

Do trade AFTER the news. Immediately when the spread cools off. Usually 1-2 mins following the launch. Some nice remains are there for the small folks...

News trading is strictly. Avoid the bad habit. You may earn money once but one day it will blow off your account.