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  • #14,421
  • Mar 11, 2023 5:10am Mar 11, 2023 5:10am
Quoting hfarooqui48
Does anyone know of a prop firm that trades spot instruments for fx I am yet to find any. So far all the ones I have contacted use CFDs. Would really love some help on this.
I don't see any difference from spot or CFDs, forex is not regulated market where every provider will offer you different price.
CFD or SPOT provider would be the same, will give always the same non regulated market with different prices and quotes...
the same for the Swaps, every provider will give you different swaps.

So let's say you want to compare any CFD MT5 platform with InteractiveBrokers, will be again the same market where both MT5 CFD or IB "SPOT" will offer you again the same unregulated product with different pricing... the unique thing is that in the case of interactivebrokers there is a clear swap that they calculate with interest rates of each currency and you can easily manage that risk, while every CFD providers has different mark up styles and comparing to InteractiveBrokers these mark ups on interests can be easily x2... so a long or short position on a CFD MT5 platform will cost you the double of a trade on IBKR.

Even if some forex broker will use the name "spot" I don't see what could change. Do unique difference can be spot/cfd with futures, but spot/CFD is the same thing in terms of your trading.. we have to go to see why they use the "CFD" regulation and not spot, probably to avoid some law about leverage or about capital gain taxation like in UK or don't know what. Doesn't matter.

So you question need to be complete, why you are looking for "spot" and what is your real problem.

For example interactivebrokers call his forex like "spot" or for metals they also state that you buy phishycal spot gold or silver, and this require higher fees and custody etc etc.. IBKR remain always one of the best solutions if you can trade with fewer leverage and you don't need MT5, prop world etc etc

Somebody will correct me for sure, if wrong.
in holiday till end of November
  • #14,422
  • Mar 11, 2023 8:39am Mar 11, 2023 8:39am
Quoting forexbali
What happen if I have for example a A quality trade where I do not see a target with a good ratio over 1:4 or 1:5 but it is for example a 1:2? Seen that I will earn only 2 and not 5, could I trade this entry always as quality A but lowering the risk from 2% to (2%/5*2=0.8%) to don't lose a trade where I believe has an high probability but going with 2% risk have no sense because I will lose 2% in exchange of just 4% profit? {image}
If your Reward-to-Risk Ratio for a trade A is 2:1 instead of 5:1, statistically, your trade has a much higher win rate.

The RRR and win rate are the two sides of the same coin. Increase one, and the other decreases (and vice versa). You should backtest this 2:1 setup to ensure that your trade-off of RRR for winrate isn't hurting your expectancy. Without winrate data, you cannot compute the expectancy.

So in the end your reasoning is good, you reduced your risk because of the reduction of RRR, but you now need to bump your risk to account for the better win rate.
  • #14,423
  • Mar 11, 2023 2:24pm Mar 11, 2023 2:24pm
Quoting Thoughts
Quoting Thoughts
If a liquidity crisis is coming, what do we think that means for props?
Oh dear..
-I think, it may depend on whether or not the liquidity that the prop is using is actually real. I mean, is the trading real? If the trading can be simulated, then probably, other things can also be simulated. But, I know very little about this topic, so maybe these are very stupid things to say.
  • #14,424
  • Mar 11, 2023 11:59pm Mar 11, 2023 11:59pm
Quoting Vitore
{quote} That's why CFD trading is called Spread Betting in the UK
I use IG index and they allow both CFD and Spread Betting so there is a distinction in the UK. BUT profits from Spread betting are tax free but from CFD are liable for tax.
  • #14,425
  • Mar 12, 2023 12:32am Mar 12, 2023 12:32am
I recently started with Fundyourfx. They have a very simple approach with very few rules which you can see here.
https://fundyourfx.com/faqs/trading-...for-trading-2/

They are also about the cheapest for instant funding.
Worth checking out
Good Luck
  • #14,426
  • Mar 12, 2023 1:45am Mar 12, 2023 1:45am
Quoting qtrader.co
{quote} If your Reward-to-Risk Ratio for a trade A is 2:1 instead of 5:1, statistically, your trade has a much higher win rate. The RRR and win rate are the two sides of the same coin. Increase one, and the other decreases (and vice versa). You should backtest this 2:1 setup to ensure that your trade-off of RRR for winrate isn't hurting your expectancy. Without winrate data, you cannot compute the expectancy. So in the end your reasoning is good, you reduced your risk because of the reduction of RRR, but you now need to bump your risk to account...
thank you, so my logic had some sense.

I like what you said about the same coin. So RRR, Win Rate and Profit Factor go all together. There is not a way to focus to a single one of this ratios because are all the same face of the same coin.
in holiday till end of November
  • #14,427
  • Mar 12, 2023 1:56am Mar 12, 2023 1:56am
If you use a RRR of 2:1 it just means you are twice as likely to lose but when you win you win twice as much. That is all RRRs achieve. The only thing a positive RRR does is occasionally help ride a trend but testing random bets using a positive RRR does not produce significant results. If it did trading would be simple.
  • #14,428
  • Mar 12, 2023 3:52am Mar 12, 2023 3:52am
Quoting Chokdee
{quote} I use IG index and they allow both CFD and Spread Betting so there is a distinction in the UK. BUT profits from Spread betting are tax free but from CFD are liable for tax.
Are the spreads and trading costs the same ? I'm asking this wondering why would someone chose CFDs, paying taxes, instead of spread betting.
  • #14,429
  • Mar 12, 2023 5:54am Mar 12, 2023 5:54am
Quoting Chokdee
If you use a RRR of 2:1 it just means you are twice as likely to lose but when you win you win twice as much. That is all RRRs achieve. The only thing a positive RRR does is occasionally help ride a trend but testing random bets using a positive RRR does not produce significant results. If it did trading would be simple.
Is the RRR ratio more accurate than profit factor?

If the broker has "no commissions" the profit factor get influenced from it because get reduced only if you make losses, if you have for example 5 trades, and all winning, profit factor cannot be calculated. So for example a trader could have a RRR of 4-5 but a profit factor N/A.
in holiday till end of November
  • #14,430
  • Mar 12, 2023 5:55am Mar 12, 2023 5:55am
Quoting Capablanca
{quote} Are the spreads and trading costs the same ? I'm asking this wondering why would someone chose CFDs, paying taxes, instead of spread betting.
Can't say as it is the weekend but I think they are. I think IG may have introduced CFDs as spread betting is illegal in many countries outside of the UK but the two are essentially the same. The Gov classes spread betting as gambling and there is no tax on the proceeds of gambling. However many 'traders' don't like to be called gamblers so talk of 'positions' instead of 'bets' but they are the same thing.
  • #14,431
  • Mar 12, 2023 5:59am Mar 12, 2023 5:59am
[quote=forexbali;14357289]{quote} Is the RRR ratio more accurate than profit factor?

No idea. Just sounds like semantics to me and irrelevant to results.
  • #14,432
  • Mar 12, 2023 6:06am Mar 12, 2023 6:06am
E8 funding, something new? zero commissions for indices and commodities
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in holiday till end of November
  • #14,433
  • Mar 12, 2023 6:08am Mar 12, 2023 6:08am
Quoting Capablanca
{quote} Are the spreads and trading costs the same ? I'm asking this wondering why would someone chose CFDs, paying taxes, instead of spread betting.
If I'm not wrong the law says that, if the profits from spread betting is your main source of income... you will be taxed.

So these laws usually are for small traders or who invest and want to use that law but has additional income.

For traders for living, this doesn't apply. If would be taxed because they consider it your main business.

--
Can spread betting be subject to income tax?
Spread betting in the UK and Ireland is exempt from income tax in most circumstances.
The only circumstance in which you would be likely to pay is if spread betting is your main source of income, thereby forming your business or trade. If you have a main occupation and do some spread betting on the side, this would not be liable for income tax.
in holiday till end of November
  • #14,434
  • Mar 12, 2023 6:08am Mar 12, 2023 6:08am
Apparently TFT wants to move to their own broker

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  • #14,435
  • Mar 12, 2023 6:15am Mar 12, 2023 6:15am
Quoting Capablanca
Apparently TFT wants to move to their own broker {image}
but the new dedicated servers are working well

Probably the prop business and volumes are booming... and eightcap was not ready to handle such hundred billions or trillions in volumes

but they are doing lots on money on it, so no excuses.

Who knows which is the real issue here. Of course brokers with own liquidity can be more stable than rely just on 1 partner, eightcap today, another broker tomorrow.

But we would like to see better spreads!
in holiday till end of November
  • #14,436
  • Mar 12, 2023 6:36am Mar 12, 2023 6:36am
Quoting forexbali
{quote} but the new dedicated servers are working well Probably the prop business and volumes are booming... and eightcap was not ready to handle such hundred billions or trillions in volumes but they are doing lots on money on it, so no excuses. Who knows which is the real issue here. Of course brokers with own liquidity can be more stable than rely just on 1 partner, eightcap today, another broker tomorrow. But we would like to see better spreads!
Uncontrolled problems in 8cap may cause heavy losses in props. That's why I think TFT is moving on. Otherwise they are reliable for losses caused by a third part, which is not their responsability.

I think that any prop already with decent business volume should not be dependant on glitches of 8cap.
  • #14,437
  • Mar 12, 2023 6:51am Mar 12, 2023 6:51am
Quoting Capablanca
{quote} Uncontrolled problems in 8cap may cause heavy losses in props. That's why I think TFT is moving on. Otherwise they are reliable for losses caused by a third part, which is not their responsability. I think that any prop already with decent business volume should not be dependant on glitches of 8cap.
but why eightcap has so many issues? they are doing lots of money with volumes from prop! can't understand this! how to lose this huge business.

Or probably are just demos... and they don't take care of this low income business to offer just "technology" that would be just open demos....??
in holiday till end of November
  • #14,438
  • Mar 12, 2023 9:17am Mar 12, 2023 9:17am
Quoting forexbali
{quote} but why eightcap has so many issues? they are doing lots of money with volumes from prop! can't understand this! how to lose this huge business. Or probably are just demos... and they don't take care of this low income business to offer just "technology" that would be just open demos....??
They are definitively charging volume fees from the props for demo accounts. They are even offering the service to pretty much anyone who is interested.
See https://www.eightcap.partners/prop-trading-company/
  • #14,439
  • Mar 12, 2023 9:26am Mar 12, 2023 9:26am
Quoting Capablanca
Apparently TFT wants to move to their own broker {image}
A natural progression. Even FTMO moved to their own a few years back.
Trade with confidence, trade without fear.
  • #14,440
  • Mar 12, 2023 9:26am Mar 12, 2023 9:26am
Quoting forexbali
E8 funding, something new? zero commissions for indices and commodities {image}
They need to make that permanent. Then I would dive back in.
Trade with confidence, trade without fear.
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