It was the best of times. It was the worst of times. (Apologies to the literate amongst us).
Sunday saw my usual short-term and swing trades setting up and I was doing the necessary setup work. I was also trialling my new brokers platform in an effort to make my Sunday Income trades easier to place and manage. I decided to focus on my new broker (whom we’ll call Broker 1) but decided to back up my trades at a smaller trade size on one of my existing platforms ( whom we’ll not surprisingly call Broker 2).
After the market opened I was looking for trades on EURUSD, EURJPY, AUDUSD & AUDJPY for my Income set-ups. I went to open the position on Broker 1…and that’s where I started having trouble! Broker 1 decided it didn’t like EURJPY and rejected my order and the price hung on the platform. Regardless of my resets Broker 1 did not want to have anything to do with EURJPY. Despite my best efforts I was unable to open any position on EURJPY. However for reasons only known to themselves Broker 1 decided to open not one but 2 positions in AUSUSD! Which was nice. As I was only risking a small amount of equity I was happy to let this play out.
Meanwhile on Broker 2 all my orders were opened without too much hassle. So I now have 8 positions open across 2 brokers. Here’s where it start to get interesting.
The reason I was looking for a new broker was because broker 2 uses variable spreads….and boy do they vary! The spreads can vary from 3- 20 pips which can be atrocious for your trades, as you’re about to find out.
So price pushes towards their targets which are between 15-to- 50 points away. On Broker 1 all my targets are hit on the Aussie positions. Nice work. So on Broker 1 I am now 3 trades closed for 100% profit with just my EURUSD position remaining open.
Over on Broker 2 the same positions, opened at the same time with the same targets do not hit their targets! Why? Because broker 2 has manipulated the spreads and they’ve strangely just expanded the bid/ask spread from 2-3 pips out to 7-15 pips! So strangely enough, none of my trades on Broker 2 hit their target. Price reverses and heads to my stops loss for the aussie trades! So I’ve just taken a loss on my AUDUSD and AUDJPY positions on Broker 2 despite them supposedly hitting my targets just before! Thanks broker 2.
To make matters worse Broker 2 decides to ‘dip’ my euro position by expanding the spreads and taking me out of my 3rd position despite price going nowhere near my stop-loss. To finish the night off my EURUSD trade at broker 1 closes for a few pips positive and my EURJPY trade at Broker 2 hits its full target on the Monday .
So overall Broker 1 I’m left with 3 full wins and 1 partial win. Broker 2 leaves me with 2 full losses, 1 partial loss and 1 full win. Same trades, same time, same entry price (more or less) but very different results! Perhaps now you can see why I’m focussing on using Broker 1 for these trades going forward. To be fair in the past Broker 2 has never performed as poorly as it did this Sunday night but it was vindication if vindication was needed that it was the right decision to move to a different account.
I ended up on broker 1 being up 3.5% of that account and down 1.5% on broker 2s account. Overall the trade size at Broker 1 was 8-9 times the size of Broker 2 so whilst it looks like overall I was merely up 2% overall the difference means that overall I was up over 3.1% for my nights work. Nice work…but I could do without the hassle!
So the story is make sure you have the right broker for the right type of trading! And watch your broker like a hawk. 😉