It is a lot of traders use arbitrage strategies, because arbitrage strategies continue to lead in profitability at low risk.  And the most important problem with this kind of trading is the broker. Major forex brokers prefer traders who lose money and for this reason they are in every possible way try to prevent successful trading.

We have created free cryptocurrencies arbitrage calculator  and calculator conected to exchanges. Using this calculator you can evaluate arbitrage oppotunities between exchanges and tacke into account cryptocurrencies prices and excchanges comissions.

Nowadays, due to the development of online trading, a retail investor enjoys the same full access to financial information and data as a professional trader on Wall Street. The question is whether retail investors can manage their investments without having to hire consultants.

The strategy for trading nonfarm payrolls is a fairly simply but effective strategy, which allows traders to make a profit of 100-150 pips in a matter of several trading hours (for four-digit quotes). However, it does require some trading skills; those will be discussed below. I recommend that you review them carefully, as trading the news is risky business and ignoring the rules of prudent trading can lead to losses. 

Latency: what is it?

First of all, we need to understand what latency is as a concept. In IT lingo, latency is the amount of time it takes for a computer command to be carried out. More precisely, it is the period of time between the input of a command and its execution. Expressed in milliseconds (a millisecond is a thousandth of a second), this is a term that is used widely in trading on the forex market, where it represents the amount of time that it takes for a broker’s server to communicate with a trader’s request.

TRADING THE NEWS: A STRATEGY THAT WORKS

Financial and other news drive financial markets, especially when there is a considerable divergence between expectations and results. When that happens, the market moves and prices change quickly to adjust to the new economic reality (the events are then said to be priced into the market). The time before the adjustment is complete is a time that allows astute and nimble traders to make money. Traders who engage in this kind of activity are said to be trading the news. I would like to introduce you to one of the most effective strategies to trade the news and join those traders who take advantage of these situations.

What is FIX API?

The Financial Information eXchange (FIX) protocol is an international communications protocol for electronic trading. It has been developed in order to improve communication between market participants.

If you have a trading system or a robot that requires fast order execution (e.g., a scalping robot or a robot for trading the news), FIX API is the way to go. FIX API gives the trader access to real-time quotes and market depth as well as the ability to submit market and limit orders via protected communication channels.

In the vast majority of cases, scalping and arbitrage strategies happen to be more profitable than any other strategy. As a consequence, brokers whose business model is based on the B-book and on making money off deposits lost by traders – such brokers are not interested in clients who use scalping and arbitrage methodologies in their trading. For that reason, brokers can resort to certain wily techniques that prevent traders from making money. They might, for example, require the trader to keep an order open for more than 5-10 seconds, sometimes even for minutes. Or they might use add-ons that allow the broker to increase the execution time of an order.

In recent years analyzing the trading results on our client accounts, we have found several factors that affect the arbitrage trading.

1. VPS or dedicated server;
2. Cross-connections;
3. Broker and account type;
4. Type of arbitrage software

Let's dwell upon each of them.

Over the past few years, interest arbitrage trade has increased dramatically. When dealing with a large number of customers who use arbitrage trading techniques, I can say with confidence that the arbitration methods still remain one of the most lucrative and low-risk. 

Although the trader needs to understand that he is facing a number of problems when using latency arbitrage. Like any profitable strategy, arbitrage is an unwanted strategy for forex brokers, especially if the dealer makes a mistake and switches an account into B-book, and in this case loses money.