Now we know who the market makers are...
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Thread: Now we know who the market makers are...

  1. #1
    After what happened to CHF, a few brokers are going bust while others are somehow magically untouched. I've posted a link to a website that has compiled the news releases related to their health level below:

    http://www.forexcrunch.com/snbomb-re...forex-brokers/

    Thus in my analysis, those who lived are definately market makers, because when their clients got margin called, the broker themselves wind up being the winner as it is all performed in their own backyard market. While for instances like Alpari, they have the Pro accounts (the authentic ECN ones) as well as the accounts (the market maker ones). So I am speculating that Alpari ended up in the red due to their Pro accounts had too much losses, so big, that winnings out of their market earning accounts could not cover up their losses that have to be paid up to their liquidity suppliers.

    In the exact same breath, I am tempted to conclude that brokers like ICMarkets who claim they're an actual ECN broker, actually is another market maker.

    I might be incorrect, so any thoughts from the experts here?

  2. #2
    Thats correct. Only bucketshops MM may scape from an event of the magnitude.

    Their transactions are offset internally and they only go out for liquidity in rare cases.

    Those infrequent cases are when too many clients are in the right side of this market.

    I wager they made a KILLING yesterday.

    I bet they're claiming false reductions.

    Thousands of accounts got moved to the MM via margin calls.

    And I bet a lot of TP got a not filled tag on it.

    It's similar to free cash!!

  3. #3
    Quote Originally Posted by ;
    After what happened to CHF, a few brokers are moving bust while others are somehow magically untouched. I've posted a link to a site which has gathered the news releases associated with their health level below: http://www.forexcrunch.com/snbomb-re...forex-brokers/ So out of my analysis, those who survived are definately market makers, because when their customers got margin called, the broker themselves end up being the winner since it's all performed in their own backyard market. While for instances such as Alpari, they've the Pro accounts (that the...
    You never know some brokers may be downplaying their losses in order to calm their customers; it's like banks hoping to prevent bank runs. If all of us traders all started to withdraw funds out of them, it would make matters even worse than what actually is. And a few may have been fine because 1) they are well-capitalized such as IB; they lost $120 million because of negative balances but it merely represented 2.7% of the entire capital and 2) their losses out of their ECN proved really offset by their own MM side which is very plausible probably like IC Markets and Gain Capital which I really don't care so long as their MM facet of business is totally segregated from their ECN side and they are not taking another side of customers' trades on their ECN side.

    However, the actual culprit in causing this turmoil is actually the liquidity suppliers like Deutsche who have been supposed to be there supplying liquidity and producing market but all bailed out to us and inducing a totally disrupted market. See my thread: https://www.forexsoutheast.asia/fore...ps-trades.html

  4. #4
    IC Markets is still in the process of fixing wrongful client margin calls and reinstating accounts.

    Until further notice, nothing could be reasoned about them.

  5. #5
    Quote Originally Posted by ;
    After what occurred to CHF, some brokers are going bust while others are magically untouched. I have submitted a link to a site which has compiled the news releases related to their health level below: http://www.forexcrunch.com/snbomb-re...forex-brokers/ So out of my analysis, those who lived are definately market manufacturers, because when their clients got margin called, the broker themselves end up being the winner since it is all done in their very own backyard market. While for cases like Alpari, they have the Guru...
    Well seen, those which are not affected by yesterday are Market Makers, there is no way a true ECN wouldn't harbor gotten their @rse handed to them on a plate .

  6. #6
    Dukascopy have said on their site they left it with no scratch since they had diminished leverage for EURCHF to 1:10

    Quote Originally Posted by ;
    quote You never know some brokers may be downplaying their losses in order to calm their clients; it's like banks trying to prevent bank runs. If all of us traders begun to withdraw funds from them, it would make matters even worse than what really is. 1) they are well-capitalized like IB; they lost $120 million because of negative balances but it merely represented 2.7percent of the entire capital and
    you're probably right that some of the ECNs may be downplaying their losses.

    I think forex is not the biggest aspect of IB's entire business, they've spread themselves out over several markets so I guess that is why it would not be a big deal for them.

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