There is a correction my wealth has improved by US$ 10 instead of US$ 100
Now my Equity has improved from US$ 687.88 to US$ 726 with 6 transaction closed
Now my Equity has improved from US$ 687.88 to US$ 726 with 6 transaction closed
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DislikedBefore starting the Arbritage System in my Demo Account
My Equity Was $ 687.88
Since I dont have to Account I used the same broker I carried out the following
Buy GBP/US$ Sell EUR/US$ ( Broker 1 ) In my case the same broker
Sell GBP/us$ Buy EUR/US$ ( Broker 2) In my case the same broker
After ten minutes I have seen Buy GBP/us$ ( Broker 1) and Buy EUR/US$
( Broker 2) in profit and booked both of them and re entered the same
buy of the two currency pairs with broker 1 and 2
My Wealth has improved on an overall basis ( broker1 and Broker 2)
by $ 787.88Ignored
DislikedHello all,
forgive me my bad English because I am Belgian and speaks French.
I think that this method can be interesting, but like said BILLBSS I think that if everything is bought at the same time, nothing happens and we lose the spread. But I think that if we take S1 at a time, then waiting a few hours, for example 2 hours or 4 hours, we can see things moving. I begin demo today to see the result.
So long, LucIgnored
DislikedHrm, you sure? LOL. I thought he was closing out his profitable trade and then waiting for the other to be profitable, then closing the 2nd trade. Then restarting both.
If he's just re-opening the profitable side again.. .what's the point of any of this?
So what happens if the set moves strongly in one direction? You close out the profitable one and let the unprofitable one run? So uhm, what happens if the unprofitable one is closed and hits your account? Or if the pair then reverses and consolidates? You take the other side of the hedge, but now neither of your trades are profitable because the loser hasn't gained enough to be profitable?
No SL hedges work when pairs consolidate, and the EURGBP has been in consolidation for a little bit, but if it ever breaks out and moves in a trend you'll eventually blow up. No loss can run forever in a leveraged environment.Ignored
QuoteDislikedStep 5 Know when to close your profitable spread. There are many ways to do this, and I have found the way that suits me
best after months of trial and error. The best way to describe my approach to taking profits is simple...I get up each morning before 10am Central Time and check both of my accounts. I close the spread that is making money, whatever the profit happens to be, and reopen the spread just as it was before. I check my "losing" spread, make notes , and LEAVE IT
ALONE....it is only a paper loss right now, and eventually will become profitable.
DislikedIt accomplishes nothing except feed the broker the amount of the spread each time you open one.
Yes that's right, it is because we do not have to cut the position if it is under the cost of the spread. At this moment GBP-USD=3.2 & EUR-USD 2.3 so dont cut under a benefict of 5.5 minimum, (3.2+2.3=5.5).
For the moment there is no big move, so we have to wait...Ignored
DislikedTo all the people who are confuse about this system, please look up "ARBITAGE" and understand the meaning of this term. Arbitage is the act of taking advantage of inefficiency in the market.
Let me give an example of arbitage in the stock market and how it works. Let say the bid (sell)/ask (buy) for Microsoft is $99.75/$100.00 on the New York Stock Exchange, and the bid (sell)/ask (buy) is $99.50/$99.625 on the Toronto Stock Exchange. We now have an inefficiency in the 2 markets. You could buy all day long on the TSE and sell on the NSE Microsoft stock and make $0.125 per share. Just pay the TSE broker, take delivery of the stock certificates and deliver them to the NSE broker and pick up your check. Deposit check in your bank to cover the check you wrote to the TSE broker and the difference will grow your bank balance.
How does this apply to forex you ask. In a perfect world selling G/U and buying E/U would be the same as selling G/E. In the real world, it's not the same, the 2 pairs have high correlation, not 100% correlation. The amount of correlation is also not constant, hence this is where arbitage comes in.
Optical's system trys to take advantage of that. As the correlation between G/U and E/U changes, the "spread" as he calls it changes so that one side (long or short) will be profitable. The system locks in this profit by closing that "spread" and immediately open a new position. The correlation tend to go back to the median between GBP and EUR and hence the expectation is that the losing "spread' will eventually BE or profitable
I hope this help some people to understand the system.
AND SELLING G/U AND BUYING E/U IS NOT THE SAME AS SELIING G/E...in a perfect world, yes. In the real world , no.Ignored