In each dealing center eventually formed their own stereotype of behaviour in the market of the average customer. From this stereotype affects how the dealing center displays (or outputs) client positions on the external market for the greatest efficiency, profitability and minimize the risks of the business process. Below, you will learn about the basic techniques of the dealing center with client sites.
the easiest method of work. This is used mainly when working with inexperienced clients or in regions where the speculative aspect of investment business is practically undeveloped. Using this method, the management of the broker based on the assumption that the vast majority of players (customers) sooner or later lose their money. This contributes to a number of reasons. The main ones are extremely low professional training of a client, excessive aggressiveness and almost total ignorance of the foreign language. These clients are very often completely cut off from the main information flows. Besides, we need to remember that having open positions person is under strong psychological pressure and likely to commit to inadequate actions, that does not contribute to its profitable activity. In the case of "cuisine" function DC reduced to absolutely безэмоциональной Desk client (virtual) transactions and their results. All the work to reduce customer accounts perform client stupidity and greed. To increase the profitability of the process employees of brokerage with various tricks, requires customers to commit as much as possible the number of transactions. As a rule, technology "cuisine" use DC, in which customers operate in client halls and are subject to implicit influenced both by employees DC, and such clients in a greater degree, rather than customers of the online brokers.
note that this technology is widely spread in our country, but not for their perceived bring super-profits, and often because of the low professional training organizers dealing platforms, last unsuccessful traders or people not familiar with this business, i.e. simply not able to organize the work of a competent with client sites. In this case, the high risk of working with such companies is not due to the used method of work, and all for the same incompetent leadership.
the Specifics of this technology is known, any sensible trader, but we will examine it. The term "brokerage" refers to overlapping absolutely all client transactions (positions) at the time of Commission. Brokers can be profitable only by a fairly large number of customers and their activity in transactions. In addition to a simple collection of Commission or spread, the broker can earn money "slipping off" the market against the customer. Move the market in various ways. Because any client transaction passes through a dealer broker, accordingly, it is the dealer makes the price (quote)provided by the client. Having the opportunity dealer can do the following:
at The moment of opening positions dealer translates customer quote your broker. Respectively and the dealer and the client are in the market at the same price. When the client requests a quotation for open positions, the dealer knows exactly what is going to make the client. Will he sell or buy. With that knowledge, the dealer can freely move the market against the customer (i.e. give him a quote for the worse, than that on which he has the opportunity to make a deal itself at a given time) in the expectation that the client will close the position at this price. Thus the difference between the closing price of the position of the client and the closing price of the position of the dealer is an additional profit DC.
over time, dealers begin to "feel" their clients and at the time of request of the quotation the client for opening a position of an experienced dealer can with quite high probability to predict what exactly wants to make the client (buy or sell the requested tool), therefore, the dealer has the opportunity to push the market against the customer at the moment of opening them (client) position. The same dealer can do when the client intends to position close. Thus, the dealer goes in and out of the market at prices better than the client.
Study of a large number of statistical data allows to formulate and effectively applied in practice some more technologies.
the Basis of this technology is the following proposition: For KK is not able, or not willing to use the technology brokerage, the basis of profit are the client losses. Client transaction is fully completed within one day, as a rule, do not bring broker nor the large profits, no big loss. In the total amount of these transactions bring a small profit. The basic money (the main customer losses) are positions that remain open within a few banking days, and lead the customer to a large, significant losses.
the Adoption of this thesis as an axiom (statistically and empirically confirmed) involves the following course of action. With client positions at the moment of opening it does not do anything. Dealers simply watch alteration client gains and losses. Take any action to block the client's positions dealers begin only when the values of the current client losses reach a certain boundary values. For example, the client's position can be shut off when the current loss on the position of reach, for example, 30% of total customer deposits (this figure manual DC, naturally, can vary randomly, based on its own considerations). Or the client's position can be closed when the current loss will reach such values, that through a small number of items (for example, 20-30 pips) this item, you can (should) forcibly closes to limit possible сверхубытков.
As you can see, the above-described technology slab tends to technology "kitchen" and in fact represents himself cuisine with administrative entered border conditions. Below you will see another technology tends to брокеражу.
the Essence of this technology is that all client transactions overlap through third-party brokers, but not in the moment of the client's transaction, and with a certain time lag. Briefly the essence of this technology can be formulated as follows. Almost always, any client position after its opening does not go immediately to the client in a profit. Almost any position on the moments during which the client for this position carries some losses, respectively, DC has this position some profit (provided that this position is not covered by the third party broker). Hence the image of the dealer's actions DC when using such technology is as follows. The client requests dealer quote, dealer independently such quotation forms and provides it to the client. The client makes this deal quote (open position).Дилер registers settings open position and begins to wait for the moment when it begins to bring the client loss. When the dealer believes that the value of client loss is sufficient (or has an administrative set values), it overlaps the client position with another broker, thus fixing profit DC. Values recorded thus client losses, as a rule, are not great. Mainly, these values are used even in paragraphs, and directly in monetary terms. For example, a dealer may receive from the management of the installation to override the client's position at the loss of the equivalent of several tens (hundred) US dollars. Figure can arbitrarily change the direction of DC depending on the statistical picture of the DC.
the Above technologies are mainly used only when the DC is not enough real trading clients. If the number of clients DC is great and they generate the required number of transactions per month, the most feasible is to organize the work of DC as follows. It only tracks the cumulative multi-currency position of the whole site, not each specific position of each particular client. All the matter is that when a sufficient number of the clients of their position in most cases some extent overlap. Therefore, if the clients and win money from each other, not DC, which in this case is perfectly lives on spreads, сдвиганиях market and the Commission. Perform any actions for closing client positions DC starts only when due to the emerging market clients begin to make transactions in any one particular direction. In such cases occurs at the site of the unbalanced currency position, which overlaps the third-party brokers. I.e. such DC ceases to be a "kitchen"and becomes quite normal clearing house. That is perfectly normal method of work of the majority of large Russian and foreign brokers.
note that if competent work with client positions, profit DC may be higher than the client losses. I.e., the technology of "cuisine", contrary to the stereotype, not always is the most profitable. In each case, the broker provides continuous collection and analysis of statistical information on the main parameters of client transactions. And then, in accordance with the accumulated statistical information takes the final decision about the use of the technology of work and its main parameters. This method of work, as a rule, is kept secret and is know-how of the company.