Why do some brokers prohibit arbitrage trading and how to avoid it?
The popularity of trading increases every year. It’s not just the appearance of a large number of traders or stock-market speculators, but in the appearance of brokerage companies. Especially, “not clean” fix api forex brokerage companies. After all, for such organizations it is a simple way to earn easy money.
We all know what scheme do these companies follow: all trading operations trade not on the market, but on the broker’s server and every loss of a fix api trader is a profit for the company. Accordingly, when the trader earns, the broker under this scheme does everything possible to prevent it.
Thus, profitable trading will be limited, and if we talk about arbitration, it will be completely banned.
The thing is that fix api arbitration has minimal risks and the logic of its work is based on exchange rate delays. If the broker is not playing a fair game, then his quotes will always lag behind the market, because they are taken from the market and duplicated on the server. But just at the moment of copying, there is a small delay and a discrepancy in quotations, which opens the possibility for fix api arbitration robots. To put it simply, the robot analyzes the value of the financial asset in the real market and compares it with the broker’s quotes. In this case, the program specifies a parameter that determines the faster broker from the slower one. When the price of the quotes shows the maximum discrepancy, the trading algorithm opens a deal on the side of the slow (not high-quality) broker to the side of the faster one and thereby it receives a guaranteed positive result of several points. But making about 100 transactions a day, the financial result of such fix api trading immediately increases. The main part of trading robots works on this principle, (http://forexzzz.com/software/).
That is why arbitrage trading is super profitable when you trade in such companies. But at the same time, all prohibited it up to the points in the contract. Agree that if the broker delivers all the operations to the market, then he would not make a difference what kind of trading method he uses, right? With the help of this tool, you can find out how quality is the broker. Also, I would single out one more criterion: if the broker allows fix api trading, you can safely declare its openness and reliability, as well as apply the arbitration approach.
But what to do if the broker chosen by you just refers to the first kind. Of course, the ideal option is to withdraw your funds and open a trading account in a quality broker. Well, if this cannot be done, then there are several ways that you can make arbitrage transactions on any site and at the same time remain unnoticed.
It’s about manual trading modules. The forex broker system will perceive the trading operations opened with the help of this program, as a manual opening, rather than algorithmic. When the arbitrage transaction is made by a robot, it is very simple for the broker to detect and prevent it. But if you install a special module (program), then the trading operations will be undetected.
Also, similar software can be used in the event that the broker limits algorithmic trading (not just fix arbitration arbitrage, but any). Then, the system will also perceive trading operations as transactions opened in a manual mode and there will be no problems.
Arbitrage trading is an instrument of guaranteed income in the forex market, which is capable of trading with zero risks. Such characteristics are far from being in the hands of each broker, who earns not from commission, but from his clients. So you need to know how to deal with this and what auxiliary tools are on the market. I hope you will take some of them into service.