Traders may request quotes from a market maker using a platform that incorporates an instant messaging type feature. The request is usually for a currency pair and trade size. The response is a two-sided price quote. Request for Quote trading tends to favor the market maker since only the market maker has time to see the trade and positions before making a quote. A dealer may then adjust that price up or down before responding to a trader’s request for a quote. Request for Quotes is an older trading mechanism still used and preferred in most trades in excess of $25 million.
Click and Deal Trading
Most Forex firms use the Click and Deal trading mechanism. The advent of the Internet makes the -what you click is what you get” (WYC/WYG) technology available to online computer users. Otherwise known as one-click dealing or executable streaming price feed, the Click and Deal mechanism provides live quotes that may be traded instantly. Most prices are streamed, i.e. they are constantly updated. The streaming data provide for an orderly and dependable marker. Though there are established limits on the amount that may be traded on a price the limit has proven to be more than sufficient to satisfy most retail traders. Click and deal trading limits the advantage that market makers have with Request for Quote trading. Market makers ace required to post two-sided quotes giving traders the option of trading on the quote or not trading on the quote. Traders have the advantage of seeing the quote price before revealing their intentions to the dealer, allowing transparency in Click and Deal trading and providing a mechanism that is the complete opposite of Request for Quote trading. Instead of having the trader ask the market maker for a price or a given currency pair that the dealer may adjust, the trader sees the price before deciding whether to trade. Click and deal trading is the most common type of platform used in retail Forex.
If you decided to become a forex trader you need to be very careful when choosing a trading company or a broker.
Hundreds of firms, owners, and employees have defrauded more than 25,000 customers of more than $300 million. Fraudulent firms have been known to offer bid/ask spreads in excess of 30 pips and require commissions for as much as $200 per trade. Many of die guilty parties have been prosecuted and sentenced; however, defrauded investors rarely recover the funds they lose.
• Promising profit that is never delivered.
• Claiming that most customers make a profit when, in fact most of them lose money
• Claiming to be trading customers’ funds when, in fact, they are stealing from customer’s funds
• Advertising fake success stories, using fake customers.
• Providing customers with fake account statements that show false trading profits.
• Claiming long tenures in the business when, in tact, they have only been in business for a matter or months.
• Claiming that most customers make a profit when, in fact most of them lose money
• Claiming to be trading customers’ funds when, in fact, they are stealing from customer’s funds
• Advertising fake success stories, using fake customers.
• Providing customers with fake account statements that show false trading profits.
• Claiming long tenures in the business when, in tact, they have only been in business for a matter or months.
Feel like getting several forex software? STOP, before you purchase you must read the reviews of the forex software you want to pay for.
For more details about forex software - check this review.
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