It isn't necessarily a racket Joab. I've been trading IB forex for a couple of months now and watching the futures on the main pairs at the same time. I also use Sierra Chart to derive cross rates from the futures for comparison. They track pretty closely with lower spreads on the forex (down to 1/2 a tick with IB). There are some edges to gain by watching both but by no means do the edges make it a racket. This is during asian hours and early european hours so if anything is screwy it would take place in these thin markets. Note: I am not implying that some of the bucket shops don't run rackets however. And a Merry Xmas
IB is an ECN. IF you track them, you'll notice they clear through Citibank, Barclays Bank, Bank of America, HSBC, Lehmans and Royal Bank of Scotland. Depending upon currency and liquidity.
A quick calculation for all those who can easily make 10 pips/day, every day. The variables are: crossrate of the currency pair (the example is EUR/USD): 1.45 daily profit (the easily achievable 10 pips) 10 * 0.0001 = 0.001 trading days (1 year, we don't work on weekends): 250 leverage (high leverage since we are constantly profitable): 100 Let's work out the profit numbers in %: daily unleveraged profit in %: 0.001 / 1.45 * 100% = 0.069% daily leveraged profit in %: 0.069% * 100 = 6.9% Now lets compound our daily leveraged profits for one year: yearly compounded leveraged profit MULTIPLIER (NOT in %): (1 + 0.069)^250 = 17,556,029 From 1$ to 17 Million$ - just from making 10 pips on every day for one year AND using a leverage of 100 ...