We would like to share some arbitrage trading advices from of one of our clients who has allowed us to do this. He uses our VIP Lock Arbitrage Software, but the same rules can be applied to the standard version of Lock Arbitrage Software.
- Use different Liquidity provider for both accounts. If you use MT4 broker will be better to use different brokers with different LPs (Liquidity providers). It can reduce your profitability but makes your arbitrage trading activity completely hidden not only from MT4 broker but from Liquidity providers as well. This rule is not important for B-book MT4 broker, but when broker will switch your account from B-book to A-book, LP can understand what’s going on. Our comment: for some brokers it is enough to have 2 accounts under different names and use IPs Changer software.
- Change your trading pattern time to time. It means you need to change: lot sizes, trading pairs, maybe trading hours. Our comment: This advice is important if LP use artificial intelligence for trading flow analysis. In this case artificial intelligence anti-arbitrate plug-in will find accounts with the same patterns of trading.
- It is better to use broker, which you find by yourself, because if broker has low percent of toxic flow, this will give an opportunity to use this broker for a long time. Our comment: toxic flow means arbitrage, news trading, scalping trading.
- Some LPs (Liquidity providers) can work only for particular currencies / indexes / CFDs and do not work for another symbols. It is better to try symbols from different markets / regions. For example, I use for testing purposes: EURUSD, USDCAD, USDJPY, XAUUSD and DAX with smallest possible lot size.
- It's a good idea to constantly monitor broker’s execution time and spread and reduce order size if you find that broker changed your trading conditions. Some time it can be temporary issue and not affect your trading. Our comments: For MT4 accounts you can use our free indicators and expert advisor to control execution time and spread.
Free MT4 Indicator for Spread Monitoring
Free MT4 Indicator for spread monitoring: shows you current spread, minimual spread, maximal spread and average spread. We recomend to use it on M1 time-frame.
Free MT4 Indicator for Execution time monitoring
Free MT4 Indicator for execution time monitoring: shows you current execution time, minimal execution time, maximal execution time and average execution time. This indicator can be aplied for any timeframe.
Video: How to Install and use Free MT4 EA and Indicators for execution time and spread control
For FIX API Accounts we recommend to check Lock Arbitrage logs and analyze every trade for slippage/ execution time