\u5916\u56fd\u70ba\u66ff\u30d6\u30ed\u30fc\u30ab\u30fc\u306e\uff08\u4e00\u7a2e\u306e\uff09\u4ed5\u7d44\u307f<\/a> where Batman and Spider-Man make guest appeaarances. It\u2019s highly recommended that you read this lesson first.<\/p>\n<\/blockquote>\n\n\n\nWhat is your broker\u2019s Order Execution Policy?<\/h2>\n\n\n\n Forex brokers should provide clear disclosure<\/strong> to customers about how their orders are executed<\/strong>.<\/p>\n\n\n\nIt should be able to provide a document that\u2019s usually called \u201cOrder Execution Policy<\/strong>\".<\/p>\n\n\n\nThis document summarizes the process by which their trading platform executes your orders to obtain the best possible result for you<\/strong>.<\/p>\n\n\n\nHaving an explicit order execution policy, so you know how your orders will be handled, should be seen as a prerequisite before further evaluating a broker.<\/p>\n\n\n\n
You should look for the following:<\/p>\n\n\n\n
\nThe process followed for\u00a0selecting the price sources<\/strong>\u00a0used by the company.<\/li>\n\n\n\nThe process for\u00a0selecting the hedging counterparty<\/strong>\u00a0(\u201cLPs\u201d) for their customer\u2019s trades.<\/li>\n\n\n\nThe process for\u00a0selecting and monitoring the technology<\/strong>\u00a0used for executing customer orders.<\/li>\n\n\n\nHow the company\u00a0manages any potential and actual conflicts of interest a<\/strong>rising when executing customer orders.<\/li>\n<\/ul>\n\n\n\nOnce you\u2019ve read and understood their policy, there\u2019s more homework to be done!<\/p>\n\n\n\n
Here are some questions to ask your broker to help you evaluate the quality of their order execution:<\/p>\n\n\n\n
\nHow committed is the broker to order execution quality and transparency?<\/li>\n\n\n\n How automated is their order execution process?<\/li>\n\n\n\n What is the average spread per currency pair?<\/li>\n\n\n\n How fast are trades executed?\u00a0What is the average execution speed?<\/li>\n\n\n\n What percentage of orders are executed with slippage?<\/li>\n\n\n\n What percentage of trades are successfully executed?<\/li>\n\n\n\n What percentage of orders are executed with positive slippage?<\/li>\n\n\n\n What percentage of orders are executed with negative slippage?<\/li>\n<\/ul>\n\n\n\nHow committed is the broker to order execution quality and transparency?<\/h2>\n\n\n\n Brokers who are committed to fair pricing and quality order execution prove it b being transparent<\/strong> \u305d\u3057\u3066 publicly disclosing execution statistics<\/strong>.<\/p>\n\n\n\nThese brokers regularly publish execution data reports which include stats like average execution speed, average spreads, percentage of trades executed at the requested prices (no slippage), and percentage of trades executed with both positive and negative slippage.<\/p>\n\n\n\n
These reports are usually published on the broker\u2019s website. If you can\u2019t find it, contact the broker and request it.<\/p>\n\n\n\n
Aside from order execution reports, how transparent are they about their order execution process? Do they disclose the following:<\/p>\n\n\n\n
\nWho are their liquidity providers (LPs)?<\/li>\n\n\n\n What percentage of volume does each LP provide?<\/li>\n\n\n\n Does it disclose any close links, conflicts of interests, or common ownerships with any LPs?<\/li>\n\n\n\n Does it disclose any specific arrangements with any LPs regarding payments made or received, discounts, rebates, or non-monetary benefits received?<\/li>\n\n\n\n Does it provide an explanation of how order execution differs according to different customers, where the broker treats categories of customers differently?<\/li>\n<\/ul>\n\n\n\nIf they can\u2019t provide one or mention that such data or information isn\u2019t made public, then you might want to move on and choose a broker that is more supportive of transparency and fairness in the retail forex industry.<\/p>\n\n\n\n
How automated is the order execution process?<\/h2>\n\n\n\n There are shady brokers out there that manipulate order execution conditions in their favor.<\/p>\n\n\n\n
Can your broker explain to you their process in executing orders?<\/p>\n\n\n\n
Is the entire process automated<\/strong>? If not, can they specify scenarios when manual intervention is involved?<\/p>\n\n\n\nWhat is the average spread per currency pair?<\/h2>\n\n\n\n On its trading platform, the broker quotes two prices:<\/p>\n\n\n\n
\nThe higher price (\u201cask\u201d), at which you (the customer) can BUY (\u201cgo long\u201d).<\/li>\n\n\n\n The lower price (\u201cbid\u201d), at which you (the customer) can SELL (\u201cgo short\u201d).<\/li>\n<\/ol>\n\n\n\nBoth prices are collectively referred to as the broker\u2019s \u7269\u4fa1<\/strong>.<\/p>\n\n\n\nThe difference between the bid and ask price is the \u5e83\u304c\u308a<\/strong>.<\/p>\n\n\n\nWhat is the average spread per currency pair made available to the broker\u2019s customers?<\/p>\n\n\n\n
Can data on spreads be broken down by hours? For example:<\/p>\n\n\n\n
\nWhat is the average spread per currency pair during ALL trading hours?<\/li>\n\n\n\n What is the average spread per currency pair during PEAK trading hours?<\/li>\n\n\n\n What is the average spread per currency pair during NON-PEAK trading hours?<\/li>\n<\/ul>\n\n\n\nHow fast are trades executed?<\/h2>\n\n\n\n How fast are trade typically executed? This is also known as execution speed<\/strong>.<\/p>\n\n\n\nExecution speed is defined as the amount of time between when the broker receives your order until execution.<\/p>\n\n\n\nThe faster the speed, the more volume of trading that can occur. More importantly, the faster the speed, the more chances for a broker\u2019s customers to be able to buy or sell at the price that they have requested.<\/p>\n\n\n\n
Ask the broker what their average execution speed is. Ideally, it should be 0.1 second<\/strong> (or 100 milliseconds) or less.<\/p>\n\n\n\nAlso, ask what percentage of trades are executed in less than 1 second. <\/strong><\/p>\n\n\n\nIf orders are taking more than 1 second to execute, you\u2019re most likely going to experience slippage because prices have changed before your order completes.<\/p>\n\n\n\n
Prices in the forex market can move in milliseconds, so if the broker\u2019s execution speed is too slow, the price you clicked on to trade on may have changed<\/strong> by the time the broker can execute the order.<\/p>\n\n\n\nWhat percentage of orders are executed with slippage?<\/h2>\n\n\n\n When you see a price on your broker\u2019s trading platform and want to trade on that price, your broker is supposed to exert every effort to fill your order at that requested price<\/strong>.<\/p>\n\n\n\nWhen executing orders, the broker has an obligation to take ALL sufficient steps to obtain the best possible result<\/strong> for their customers taking into account multiple factors. This is known as striving for \u201cbest execution<\/strong>\".<\/p>\n\n\n\nIdeally, obtaining the \u201cbest possible result\u201d means you get the price that you requested.<\/p>\n\n\n\n
But while the price is the most important factor when considering the best execution, it\u2019s not the ONLY factor.<\/p>\n\n\n\n
This means that the price you wanted may not be the price your order is executed at.<\/p>\n\n\n\n
Whenever you are filled at a price different from the price requested, it\u2019s called \u201cslippage<\/strong>\".<\/p>\n\n\n\nTraders typically focus more on the spread, while largely ignoring slippage unless the slippage is blatantly obvious when one of their orders is filled<\/p>\n\n\n\n
Slippage isn\u2019t necessarily something that\u2019s bad because ANY difference between the intended execution price and actual execution price qualifies as slippage.<\/p>\n\n\n\n
Market prices can change quickly, allowing slippage to occur during the delay between a trade order being processed and when it is completed<\/strong>.<\/p>\n\n\n\nSlippage can occur for many reasons, but price volatility<\/strong> is often the biggest reason.<\/p>\n\n\n\nAs price volatility increases<\/strong>, slippage (both positive and negative) occurs more frequently. As price volatility decreases<\/strong>, slippage occurs less frequently.<\/p>\n\n\n\nThis is why traders typically see more slippage during high periods of volatility, such as during breaking news or economic data releases or when a former U.S. president used to fire off a random tweet before his account was suspended.<\/p>\n\n\n\n
Under normal market conditions, if your broker cares about execution quality, occurrences<\/em> of slippage should be infrequent and the magnitude<\/em> of slippage should be minimal.<\/p>\n\n\n\nWhat percentage of trades are successfully executed?<\/h2>\n\n\n\n Successful order execution is when the order is executed at the requested price or better<\/strong>.<\/p>\n\n\n\nThis can be further broken down by market and limit orders:<\/p>\n\n\n\n
\nWhat percentage of\u00a0market orders<\/strong>\u00a0are filled \u201cat or better\u201d?<\/li>\n\n\n\nWhat percentage of\u00a0limit orders<\/strong>\u00a0are filled \u201cat or better\u201d?<\/li>\n<\/ul>\n\n\n\nWhen an order has been executed, it is referred to as being \u201c\u5145\u586b<\/strong>\u201d or a filled order<\/strong>\".<\/p>\n\n\n\nMarket and limit orders can be used as entry orders<\/strong> (that open a new position) and \u9589\u9396<\/strong> orders (that close an existing position).<\/p>\n\n\n\nA \u6210\u884c\u6ce8\u6587<\/strong> is an instruction from a trader to their broker to execute a trade immediately at the best available price.<\/p>\n\n\n\nA \u3055\u3057\u306d\u3061\u3085\u3046\u3082\u3093<\/strong> is an instruction to execute a trade at a level that is more favorable than the current market price.<\/p>\n\n\n\nLimit orders allow you to specify the minimum<\/em> price at which you will sell or the maximum<\/em> at which you will buy.<\/p>\n\n\n\nWhat percentage of orders are executed with positive slippage?<\/h2>\n\n\n\n Positive slippage, also known as price improvement<\/strong>, occurs when your order executes at a more favorable price than the price you request.<\/p>\n\n\n\n(The opposite of a price improvement is negative slippage, which is when your order executes at a less favorable price.)<\/p>\n\n\n\n
Can the broker tell you the percentage of executed trades that were executed at a more favorable price<\/strong> than the price their customers requested?<\/p>\n\n\n\nAnd what is the average \u30dd\u30b8\u30c6\u30a3\u30d6<\/em> price improvement per order (in pips)?<\/p>\n\n\n\nThis is defined by the pip difference between the requested and executed price of orders with the improved price.<\/p>\n\n\n\n
Orders can also be further broken down by market and limit orders:<\/p>\n\n\n\n
\nWhat percentage of\u00a0market orders<\/strong>\u00a0are filled at a more favorable price than requested?<\/li>\n\n\n\nWhat percentage of\u00a0limit orders<\/strong>\u00a0are filled\u00a0at a more favorable price than requested?<\/li>\n<\/ul>\n\n\n\nFor example, let\u2019s say you want to buy EUR\/USD immediately.<\/p>\n\n\n\n
You hop on your forex broker\u2019s trading platform, and see the price of 1.1050<\/strong> being displayed and click \u201cBuy\u201d.<\/p>\n\n\n\nSo 1.1050 is the price that you wanted your \u6210\u884c\u6ce8\u6587<\/strong> to be executed at.<\/p>\n\n\n\nThe order is submitted, and you receive a confirmation that your buy order was filled at 1.1049<\/strong> (1 pip below your requested price).<\/p>\n\n\n\nBecause the order was filled at a better price (1.1049) <\/strong>than you requested (1.1050), you experienced positive slippage of 1 pip<\/strong>.<\/p>\n\n\n\nWhat percentage of orders are executed with negative slippage?<\/h2>\n\n\n\n Negative slippage is which is when your order executes at a less favorable price.<\/p>\n\n\n\n
Shady brokers have software that allows them to sneakily slip traders very small amounts on every trade order. It\u2019s like \u201cdeath by a thousand cuts\u201d where traders don\u2019t realize they are losing a couple of pips on each trade. This is why you ask about their negative slippage stats.<\/p>\n\n\n\n
Can the broker tell you the percentage of executed trades that were executed at a less favorable price<\/strong> than the price their customers requested?<\/p>\n\n\n\nAnd what is the average \u30cd\u30ac\u30c6\u30a3\u30d6<\/em> price improvement per order (in pips)?<\/p>\n\n\n\nThis is defined by the pip difference between the requested and executed price of orders with the inferior price.<\/p>\n\n\n\n
This can be further broken down by market, limit, and stop orders:<\/p>\n\n\n\n
\nWhat percentage of\u00a0market orders<\/strong>\u00a0are filled at a less favorable price than requested?<\/li>\n\n\n\nWhat percentage of\u00a0limit orders<\/strong>\u00a0are filled\u00a0at a less favorable price than requested?<\/li>\n\n\n\nWhat percentage of\u00a0stop orders<\/strong>\u00a0are filled\u00a0at a less favorable price than requested?<\/li>\n<\/ul>\n\n\n\nFor example, let\u2019s say you are trying to buy EUR\/USD at the price of 1.1270<\/strong>.<\/p>\n\n\n\nSo on your trading platform, you enter a limit order with a price of 1.1270 and click \u201cBuy\u201d.<\/p>\n\n\n\nSo 1.1270 is the price that you wanted your \u3055\u3057\u306d\u3061\u3085\u3046\u3082\u3093<\/strong> to be executed at.<\/p>\n\n\n\nThe order is submitted, and a couple of minutes later, you receive a confirmation that your buy order was filled at 1.1273<\/strong> (3 pips below your requested price).<\/p>\n\n\n\nBecause the order was filled at a worse price (1.1273) <\/strong>than you requested (1.1270<\/strong>), you experienced negative slippage of 3 pips<\/strong>.<\/p>\n\n\n\n\nIf traders do check to see what spread and slippage they receive on a trade, it\u2019s typically when the trade is OPENED and then they don\u2019t bother (or forget) to check when the trade is closed. Shady brokers are aware of this. Since they know you\u2019re probably watching when you open a trade, they\u2019ll sit tight and won\u2019t interfere. But when the order is closed, that\u2019s when they\u2019ll sneak in the extra slippage.\u00a0<\/p>\n<\/blockquote>\n\n\n\n
Are you suspicious about why your order wasn\u2019t executed at the requested price?<\/h2>\n\n\n\n Brokers may have the ability on their trading platform to control and add \u201cslippage\u201d and\/or delay the execution of your order, so you end up getting filled at a worse-off price.<\/p>\n\n\n\n
For example, brokers can deliberately introduce negative slippage<\/strong> into the order execution where if price benefits the broker, it\u2019ll execute.<\/p>\n\n\n\nBut if the price does NOT benefit the broker, then the price is slipped and requoted with another price that favors the broker.<\/p>\n\n\n\n
If you\u2019re suspicious about why your order wasn\u2019t executed at the requested price, you can request a post-trade execution report<\/strong>.<\/p>\n\n\n\nUpon request, your broker should be able to provide you, within a reasonable time frame, documented evidence which demonstrates clearly that it executed your order in accordance with its Order Execution Policy and information about its order execution arrangements.<\/p>\n\n\n\n
For example, in the U.S., retail forex brokers are required to provide their customers, upon request, with certain order execution data.<\/p>\n\n\n\n
This includes price data for the 15 transactions in the same currency pair that occurred immediately before and after<\/strong> the customer\u2019s transaction This allows their customers to verify that the prices offered closely mirror prevailing market prices.<\/p>\n\n\n\nThe Bottom Line<\/h2>\n\n\n\n Forex brokers operate different order execution methods, none of which is \u201cright\u201d or \u201cwrong\u201d.<\/p>\n\n\n\n
What makes a broker good or not has little to do with A-Book or B-Book, but rather how the company conducts its business<\/strong>.<\/p>\n\n\n\nDon\u2019t assume that mentions of \u201cA-Book\u201d, \u201cSTP\u201d or \u201cECN\u201d are attributes of a good broker.<\/strong><\/p>\n\n\n\nAn A-Book broker can still go against their customers\u2019 interests as easily as a B-Book broker can.<\/p>\n\n\n\n
\u3069\u3093\u306a\u3082\u306e\u3067\u3082<\/em> broker can withhold deposits, give poor pricing, manipulate order execution processes, and lie to customers.<\/p>\n\n\n\nRegardless of the execution method of a forex broker, what ultimately matters is that the broker:<\/p>\n\n\n\n
\nProvides transparent prices that closely track the\u201dreal\u201d (institutional) FX market in real-time\u00a0<\/strong>\u305d\u3057\u3066<\/li>\n\n\n\nFills orders at requested prices without delay<\/strong>.<\/li>\n<\/ul>\n\n\n\nYou want to select a broker who:<\/p>\n\n\n\n
\nIs honest about the risks and hazards of leveraged trading<\/li>\n\n\n\n Is transparent about its pricing policy<\/li>\n\n\n\n Is clear about how it executes orders<\/li>\n\n\n\n Processes withdrawals in a timely manner<\/li>\n\n\n\n Has robust risk management policies<\/li>\n\n\n\n Is adequately capitalized (so it can\u2019t go bust)<\/li>\n\n\n\n Has a formal process for handling customer complaints that\u2019s quick and fair<\/li>\n\n\n\n Is licensed and regulated in multiple jurisdictions (especially where you live)<\/li>\n<\/ul>\n\n\n\nIf a broker doesn\u2019t provide clear information about all of the above on their website, contact them directly and ask them.<\/p>\n\n\n\n
If your broker declines to answer any of your questions, ask WHY.<\/strong><\/p>\n\n\n\nBe suspicious of any broker that believes it is above scrutiny.<\/strong><\/p>\n\n\n\nAlways consider how a broker actually operates<\/strong> BEFORE depositing real money and opening live trades.<\/p>","protected":false},"excerpt":{"rendered":"What is the quality of your broker\u2019s order execution? Order execution is a process of filling the requested buy or sell order of the trader. In the previous lesson, we talked about the prices that forex brokers show you on their trading platforms and whether the prices are fair and accurate. But having fair and accurate pricing on your trading platform means nothing if your trade hardly ever executes at the shown price. It\u2019s like visiting a bakery and being shown a photo of a cake they offer. You like how it looks so you order it. But when you get it, you discover that the baker wasn\u2019t able to actually execute and create […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[49,48],"tags":[],"class_list":["post-3572","post","type-post","status-publish","format-standard","hentry","category-forex-brokers-101","category-kindergarten"],"_links":{"self":[{"href":"https:\/\/apex-flow.ai\/ja\/wp-json\/wp\/v2\/posts\/3572","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/apex-flow.ai\/ja\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/apex-flow.ai\/ja\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/apex-flow.ai\/ja\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/apex-flow.ai\/ja\/wp-json\/wp\/v2\/comments?post=3572"}],"version-history":[{"count":1,"href":"https:\/\/apex-flow.ai\/ja\/wp-json\/wp\/v2\/posts\/3572\/revisions"}],"predecessor-version":[{"id":3573,"href":"https:\/\/apex-flow.ai\/ja\/wp-json\/wp\/v2\/posts\/3572\/revisions\/3573"}],"wp:attachment":[{"href":"https:\/\/apex-flow.ai\/ja\/wp-json\/wp\/v2\/media?parent=3572"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/apex-flow.ai\/ja\/wp-json\/wp\/v2\/categories?post=3572"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/apex-flow.ai\/ja\/wp-json\/wp\/v2\/tags?post=3572"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
![\"Poor](\"https:\/\/bpcdn.co\/images\/2021\/05\/26201027\/poor-execution.png\" "\\"Poor")
<\/figure>\n\n\n\n![\"Order](\"https:\/\/bpcdn.co\/images\/2021\/05\/26193940\/order-execution-report-150x150.png\" "\\"Forex")
<\/figure>\n\n\n\n![\"Bid](\"https:\/\/bpcdn.co\/images\/2010\/11\/13124509\/Wide-Broker-Spread.png\")
<\/figure>\n\n\n\n![\"Order](\"https:\/\/bpcdn.co\/images\/2021\/05\/26183923\/order-execution-process1.png\")
<\/figure>\n\n\n\n![\"Broker](\"https:\/\/bpcdn.co\/images\/2010\/11\/broker-slippage.png\")
<\/figure>\n\n\n\n![\"No](\"https:\/\/bpcdn.co\/images\/2021\/05\/26191752\/zero-slipplage-example.png\" "\\"No")
<\/figure>\n\n\n\n![\"Positive](\"https:\/\/bpcdn.co\/images\/2021\/05\/26191542\/positive-slippage-example.png\" "\\"Positive")
<\/figure>\n\n\n\n![\"Negative](\"https:\/\/bpcdn.co\/images\/2021\/05\/26183758\/negative-slippage-example.png\" "\\"Negative")
<\/figure>\n\n\n\n