Financial market intermediaries can work in two ways: as dealers and how Brokers. These are different types of activities, and you need to very clearly understand the difference between them.
- Dealer makes deals with clients on their own behalf and at their own expense by publicly announcing purchase prices / sales with a commitment to purchase / sales at advertised prices.
In case you are dealing with a dealer, the dealer acts as a counterparty (second side) on a deal with you. Ie. it is from him that you buy something and it is to him that you sell something. The dealer's work resembles the work of a currency exchange office, which at its discretion exposes quotes for the purchase and sale of currency. Dealer's earnings - the difference between the purchase price and the sale price: bought cheap, sold dear, put the difference in my pocket.
- Broker makes deals on behalf of clients and at the expense of clients on the basis of a commission agreement or a commission agreement, as an attorney or commission agent.
In case you are dealing with a broker, it displays your order on the exchange market, where she finds a counter request and is executed. Broker's earnings - commission for the operation. A broker is just an intermediary, he does not quote you and does not trade with you. The broker is obliged to clearly and conscientiously fulfill the instructions, which the client gives him. Broker earnings - commissions, which the broker charges you for the execution of your orders.
In the stock market, the vast majority of financial structures work as brokers. If you are a small investor, then for trading on the securities market you will be offered to sign a brokerage agreement. You can do an OTC trade with a financial structure, like a dealer, but it will rather be an exception to the rule, than the rule. For example, you can sell securities to the dealer, inherited during privatization. Or you can sign an agreement with a dealer, if you want to buy or sell a large package of securities on special terms. But in the overwhelming majority of cases in the stock market, a small or medium investor or speculator (with an amount in the range from hundreds to tens of thousands of dollars.) will work with a broker.
На форексе (let's talk about its Russian version) the vast majority of financial structures operate as dealers. If you – small or medium speculator (with an amount in the range from hundreds to tens of thousands of dollars.), then you have to deal with the dealer. Working with a forex broker will be rather an exception to the rule., broker, providing access to trade on “настоящем”, “большом” forex will agree to work with you only with amounts, starting from several tens of thousands of USD. Usually, it is either a large foreign structure, or a large bank. In the vast majority of cases (including in offices, who actively advertise themselves in the metro) in forex, a small or medium speculator will work with a dealer.
It would seem that, what is the difference? Especially if you position yourself as an aggressive speculator, is it all the same, how and with whom to trade?
There is a difference. Although outwardly, especially for uninitiated people, she is not noticeable.
А дело вот в чем.
Broker doesn't care, will you win or lose. The broker's earnings in no way depend on, will you be in profit, or at a loss. The broker only executes your orders, bringing them to the exchange market. If you will be in profit, the broker will be glad for you, since the increase in funds in your trading account, probably, will lead to an increase in the turnover of your transactions, which means, and to increase the broker's income. However, если вы проиграете, the broker is unlikely to be very upset – he will receive commission from you in any case, as a percentage of the amount of transactions you performed.
And a completely different situation with the dealer. The dealer is your counterparty for each trade. All transactions are made between you and the dealer. Therefore, your loss is the dealer's profit. Your win is the dealer's loss. Если вы проигрываете, then the dealer makes money on it. If you suddenly win, then the dealer suffers losses.
Once again, I will specifically highlight this thought.:
The dealer is interested in you losing
This is not an accusation against dealers. Речь не о том, good dealer or bad, cheats or does not cheat, helps you lose or doesn't help you. It's just that the dealer's workflow is as follows, that the dealer is directly interested in your loss. And you need to be aware of this (Alas, most forex speculators of this, Unfortunately, does not understand).
The second important point, concerning your relationship with a forex dealer. You, actually, playing with the dealer (and other market participants). In this case, the dealer knows the rates of all participants., including yours. А вам, Unfortunately, No.
Imagine an analogy. You are playing cards with your partner (for example, in preference, или в дурака), but the partner knows all your cards. And you don't have his cards. How do you think, Who won? Inter alia, partner will not always win. It all also depends on the alignment (везения), and from the ability to play, calculate the situation. So even in such a situation, you have a chance to occasionally win in separate games.. But in general,, if you play long enough, then the ending is easy to guess.
And this thought is worth highlighting.:
The dealer knows all your bets
And the third important point. Let me remind you, the dealer himself determines the market for those, who is he playing with.
Seasoned Forex speculators know, what if you open accounts at several forex offices at the same time, then quotes may vary. It would seem that, forex market - single, and the quotes in different dealing centers are different. Actually, в этом нет ничего удивительного, because the quotes are set by the dealer himself, at your own discretion. Has the right to. You are not surprised, that different currency exchange offices have different courses?
(By the way, when working through a broker on the securities market, such a situation is impossible. If I have accounts with different brokers, then, by loading the order book in different Windows windows, I will see absolutely the same stock quotes on the screen. Это и понятно. Brokers do not quote you quotes., they just broadcast requests to you, выставленные на бирже).
Yet again, to make it easier to imagine, what can this lead to, I will give an analogy. Imagine a racetrack, on which, already after, how are the bets made, the owner of the racetrack can ask any jockey to slow down a little, or, against, whip up a particular horse? Do you have a chance to win in such a situation?? Yet again, the chances of winning in individual races remain, but in general, расклад, obviously, not in your favor.
And this, третью, I will also highlight the thought:
Dealer can influence the market
Yet again, I do not state at all, that dealers are doing this, not at all wanting to write everyone indiscriminately among the scammers. I only speak, that the dealer has such an opportunity. And whether he uses this opportunity or not., it remains on the dealer's conscience. May not use. Let's say, the fox has the opportunity to periodically enter the chicken coop and carry chickens under cover of darkness. And she is directly interested in this., because he wants to eat. And she takes this opportunity, or does not use, it remains on the fox's conscience.
And now, if we still assume, “that someone here and there sometimes does not want to live honestly”, (ну так, purely hypothetical), how exactly can he do it?
Yes Easy! Simple and quite “честный” the way is, to just play against the aggregate position of all players, slightly shifting quotes. It can't even be called a scam, this – full dealer's right. For those, who doesn't understand, what “position”, I will try to explain as simply as possible, “on fingers”. Let be, for example, at the moment, all the clients of the dealer in total have bought much more dollars for the euro, what sold. Means, at some point people will sell them back (“close positions”). Means, it makes sense to move the dollar quotes down a little, so, so that the reverse sale of dollars for euros will bring profit to the dealer and losses to customers.
Major dealer, probably, этим и ограничится.
But there are worse cases., when the dealer starts to play not against the aggregate position of all players, but against the specific position of specific clients. It makes sense to play such a game against large clients, trifle in this case is not interesting. How can I do that?
Let me remind you, the dealer knows your position, the amount of money in your account, And, finally, levels, on which your feet are mounted. So why not depict such a market movement for a short moment., which will make you automatically close at a loss? In this case, a short-term “Thorn”, knocking out your stop, or, worse than that, closing your position due to insufficient funds in the account. Characteristically, that you will not see similar market movements on the charts of other dealers.
(Похожие charts can also be found on the securities market. But in the stock market that, who wants to play against you, will have to really “move the market”, making real deals for real money, and taking certain risks. There is no need for forex. “move the market”, you just need to move your own quotes.)
There are other ways. For example, in moments of strong market movement at the dealer “suddenly” software freezes or communication channel is lost, which prevents you from taking profits or minimizing losses. You can always refer to technical problems.
(Yet again, brokers also have technical failures. Any technique does not exist 100% надежной. But you need to remember, that the broker is not interested in your losses. But the dealer may have a direct interest in refusing to execute your orders., citing technical reasons.)
I will separately dwell on “правилах игры”, which subtly nudge aspiring currency speculators to ruin quickly. For example, shoulder 1:10 (or, especially, 1:100 or 1:200) Is one of these ways. Such a leverage is suicidal if you do not know the basic principles of risk management.. But before, how beginners begin to understand this, more than one month and more than one drained deposit will pass. What, actually, the dealer needs.
Yes, keep in mind, that in case of unlawful, in your opinion, there is no one to complain to about the actions of the forex office. Unlike the stock market, where is the FSFM (Federal Service for Financial Markets), forex is not controlled or regulated by anyone. You are not to the police, в самом деле, пойдете, with claims, that the yen was bought for you at the wrong price?
И еще имейте в виду, that many forex offices are just LLCs with a minimum authorized capital, that can just as easily disappear, how did it appear. No control, no reliability requirements, уставному капиталу, риск-менеджменту и т.п. Anyone can register a forex office, costs are very modest. So they grow, like mushrooms.
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