When size is a problem

Discussion in 'Forex' started by Georgii, Oct 25, 2009.

  1. Georgii


    Hello all,

    I've generally noticed that there are traders who are able to produce some very high rates of return from small account sizes. I've read of a number of cases where traders have run up five and even four figure sums to seven figure sums in the course of 12-24 months. Granted, I don't know what their risk strategy is and if they just got lucky on a general market trend, but suffice it to say there seem to be enough such stories where we hear of over 100% returns a year.

    However, once the account approaches seven figures, it seems that the rate of return is often significantly lower, and a 30% return is something to be very happy about.

    I have always tried to pinpoint why this is the case (we're talking Forex, specifically). Is this because:

    a) Large contracts are more subject to slippage and can't get as good of a fill, you get delayed execution.

    b) Your order's size moves the market and doesn't get you a favorable entry/exit.

    c) The psychological fear of losing such a large sum of money and consequently a need to take less risk.


    Is it possible, for example, to successfully use an intraday "scalping" or "jabbing" strategy with seven figure positions? Or do traders at this point resort to swing trades/position trades only?

    Also, are there any figures that represent benchmarks of difficulty here, i.e. a noticeable performance decline above a certain amount of traded contracts, etc?

    Thanks for any input...
  2. I too am interested in this. I mean six figures getting instant fills is no problem but say you got into managing O.P.M. or your own account got into 7 figures+ at what size do you start running into fill problems?

    Say you got upto $3M but then with leverage you are buying/selling over $10m of one currency at a time....you are going to start seeing delays in fills right? Or not?

    Yeah i know it's a 1000,000 trillion a day market blah,blah,blah......but lets' get real.
  3. well look at Cabletrader with $2,000 Oanda mini account he can scalp like a crazy man...but you could not do this with 7 figures. So your trading style has to change.

    AND..if you had $1M+ wouldn't you want to focus on the risk a lot more...? I mean 30% on $1M is $300,000. So there's no point going for 80%+ gains unless you are a greedy..

    I suspect if trading one market you are going to hit a problem with size at some stage. Where that is..?
    he psychological fear of losing such a large sum of money and consequently a need to take less risk.

  4. http://www.dukascopy.com/

    They display a staggered rate table feed with volume on their homepage.

    Providers are institutional ecns (currenex, hotspot, lava) + major fx banks.

    eurusd avg volume on refresh is about 300-400 mio. Refresh every couple seconds.

    3000 contracts on eurusd might be upper limit of whats doable with little-to-no slippage.

    Other guys told me half to a full yard is possible. but liquidity is down since the crash.

    Nice to dream, eh? :)
  5. lol, half a yard, now you're talking, chance would be a fine thing! :D

    I'm scalping on Oanda with multiple trades of 250k which is chicken feed I know, but on the rare occasion I've got carried away and had to close a few positions at once they've totalled ~3m and it's been filled without any slippage. Liquidity has never been an issue and I doubt it would be at these levels. Oanda claim instant fills up to 10m a ticket and I know traders who regularly trade 5m who say they haven't had any problems.

    If someone's got sufficient trading capital to be in the 3,000 contracts league then they're going to be trading on an institutional platform anyway aren't they?
  6. $2,000, oh come on, I'm not made of money!

    I'm a poor daytrading scalper trying to earn a crust.......:D
  7. You're not made of money? One would have thought you would be swimming in cash by the way you post as if you are omniscient and treat others with disdain and contempt.

  8. Avery Horton aka 'TheRumpledOne' you are a snake oil salesman and a liar. You tout your indicators around the forums and have been banned from all but a couple of trading forums for promoting your wares and promoting the broker you work for as an IB.

    You offer your indicators in exchange for a minimum 'donation' of $50 which amounts to the same thing as selling, and you only do it that way so you can avoid having to write any supporting documentation or user manuals, and as a 'gift' people can't send them back for a refund when they find out they've been ripped off.

    Avery Horton you are a liar and a thief!

    Don't like the truth? Sue me! :D
  9. "When size is a problem" is the topic.

    Your post is OFF TOPIC and against forum rules.
  10. LOL OK fair enough.


    $2,000, oh come on, I'm not made of money!

    I'm a poor daytrading scalper trying to earn a crust.......

    When you say 3,000 contrats.....what do you mean in forex? This is spot forex right not futures we are talking about?
    #10     Nov 3, 2009