If my broker was OANDA, and I had $5,000.00 in my account, could I put in several Limit Orders of $5,000 each? For example, if I was pretty sure 2-3 currency pairs were going to move my way, could I put a $5,000 bet on each, then whichever was first to move - would get all my $5,000? The other limit orders might also get hit, but I assume they would be cancelled due to lack of available funds. Another use would be if I thought a trend would form in one of the pairs, but I didn't know which one - so I could put in limit orders on all of them, and then get stopped in to the trade once one of them moved. Or is this illegal or unethical to place bets for money that I do not have in my account? (putting in 5 limit orders for $5k a piece would be $25k in limit orders!)
It seems that with Oanda you could put on more limits orders than you could acutally afford. Presumably when the second order is reached it would be cancelled NSF. But why would you want to bet your entire account on a single trade?! Are you really in that much of a hurry?
why not give it a try instead of getting possible misinformation from others? this is called initiative and is vital for successful trading.
They would be cancelled You can do that too. It's neither illegal or unethical although most would consider it VERY poor risk management.
kenazen, from your post I take it that you are both new to forex and have not had an opportunity to play with demo accounts yet. Would those be fair assumptions? A demo account is perfect for answering questons like this, among a million others, and you'd do yourself a favor by taking full advantage of it. No need to "dare" asking your broker anything. Another point: your post neglects leverage. With Oanda, you can choose or change your leverage at any time, from 10:1 to 50:1 in increments of 10. So, if you have $5,000 in your account, your available buying power may be up to $250,000. Therefore, you can enter a bunch of far larger orders, each a multiple of that 5K -- e.g., 40,000 units each of the majors, GBP/USD, EUR/USD, USD/CHF, USD/JPY, AUD/USD and USD/CAD -- and they could still all execute. OR you can enter 6 orders for around 140,000 GBP/USD, 210,000 EUR/USD, 250,000 USD/CHF, etc., and at most one of them would execute. Good luck.
Yes I am fairly new to FX, and will be using the Demo account to trade with first. I am documenting the mechanics of what is available to me, which I can then use as constraints for any system I develop. For example, I could try to make a system that would predict limit orders to place for every pair, where the first one taken would implicitly cancel the others. This weekend I am finally having a chance to look at things, but alas the market is pretty much dead on the weekends. Maybe I need more iniative.
I did some Forex trades like that and posted the results in real time within minutes of entering the trade. I didn't have any luck though. When one of the positions opened up it would retrace and hit the stop. There is no free lunch in forex.
That's an easy observation after the fact. I did not have the luxury of looking into the future when I entered my trades, and those were live trades posted within minutes of being entered. Having wider stops would not have helped, all it would have done is cause both positions to be opened at the same time and cancel each other out until one of the stops got hit. And then a retrace would close out the remaining position with the same results, but over a longer time frame. Like I said, there is no free lunch with Forex.