cTrader As a Mean of Quotes and Executions Transparency Control

Over the years, I became a faithful fan of cTrader, and the more I speak to colleagues, the more I realise that the Internet is missing some educational materials on the specifics of this unique trading platform.

No doubt, the features that are present here are worth discussing, and they are actually being discussed at traders’ forums and communities. Yet, in my opinion, a cTrader review is impossible and incomplete without raising first the question of the reliability of the companies we choose to partner with when choosing a trader’s career.

Choosing the trading environment or a broker?

When new traders plan to start trading, they start with the question: where should I open my trading account? Usually, this suggests they need to choose the broker to partner with. cTrader users do it differently, and I will explain why.

Everybody knows the three R rule when choosing a brokerage. It must be Regulated, Reliable, and Responsive. When it comes to choosing a trading platform, new users often go with what the broker offers, even if the platforms they offer are outdated. Sometimes they also turn out to be oversimplified custom developments created for the sake of attracting new cannon fodder with no skills in using complex trading instruments.

Trader’s expectations of a trading environment

This is a huge mistake to rely on the broker’s choice when choosing the trading environment. Trading results don’t depend on the broker. Your trading approach, style, and the tools you use — all these details matter, and this is highly desirable to make a consent decision about the workspace you will use in your daily trading routine.

When I first ran into cTrader’s review I realized its functionality was probably something that could boost my performance, and this was the primary reason I turned my attention to this software. The deeper I understood how it can influence the choice of the broker and how it impacts the quotes I get, the more I got interested in the details and the more I got persuaded that the way we normally choose brokers is not the best approach to be practiced.

I don’t try to persuade you that the brokerage choice is not an important decision. After all, it has control of your money, and it really must be regulated and reliable enough to keep hold of your money, store it on a safe segregated account and withdraw it along with the profits at the first request.

Yet, I offer to look at the matter from a very different perspective. Instead of choosing a reliable broker first and then going with the choice of the platform it offers, why not first set yourself comfortable with the trading platform? This order of decision makes sense speaking of cTrader fans as this platform narrows the choice of the brokers to the most reliable ones. It sounds a bit weird, but not until we understand how the business works.

Why are the quotes manipulations possible?

The market is not limited to Forex and CFDs. Spot, stocks, options, and futures traders pay a lot to get access to real-time market data flow and best trading applications and tools. Try trading Brent at ICE exchange. You will need to pay over a hundred bucks monthly only to get the real-time quotes. The monthly fee for the platform usage varies from $20–30 for more affordable platforms like Sierra Chart to $24 000 per year if you choose the famous Bloomberg Terminal.

Retail forex trading is a different niche. Here brokers try to grab the attention of the middle class, offering their services to people that can afford smaller deposits starting as low as ten bucks. There is no way you can persuade a person with a $100 trading capital to pay a considerable monthly fee for the market data and the trading platform. This is why CFD brokers get it done the other way. A centralized way.

Firstly, they collaborate with liquidity providers to get the market data flow they build the charts with. Futures traders can’t get historical quotes for a long enough period of time and normally can’t get a free demo account with live quotes for over two weeks. Forex and CFD traders can enjoy limitless demos. That’s because the broker pays liquidity providers once for the data and is free to give access to this data for thousands of its customers without much of the limitations.

Secondly, they collaborate with third-party trading platforms such as MetaTrader or my favorite cTrader. Retail traders download it from the broker’s server after creating a trading account with it. Users get it for free. Broker pays.

The question is, how do brokers make money?

Under normal circumstances, the broker makes money applying the spread mark-up, commissions, and other fair and transparent trading fees. Yet, unfortunately, some brokers choose the path of making money with their customers’ losses. I’m not going to explain exactly how this gets done. You can find the info elsewhere if you try searching for “how dealing desks work.”

The fact that I want to point at is that forex and CFD trading platforms get paid by the brokers. Brokers flash the cash and get the play, in other words. Without getting too deep into the moral aspects here, I will only claim that the most famous trading platforms for forex trading have allowed creating the special plugins that brokers can use to correct the historical quotes. Virtual dealer plugin and other similar solutions have appeared. Notice, I’m not even speaking of the custom broker’s applications that have no transparency and no control of the data flow they use at all!

Requotes, price manipulations, false executions — these are the traders’ nightmare issues that the cTrader platform does not want its users to face. Thanks, guys, we highly appreciate it!

The official position of cTrader

cTrader parent company Spotware collaborates with brokers and gets paid by brokers too. Yet, there is a huge difference in the approach.

I was pleased to learn that the official slogan of cTrader is “TRADERS FIRST.” Of course, the saying does not ensure the factual state of business, yet I really liked what official representatives state about their attitude to price manipulations.

cTrader official position on price manipulations

If you look at the list of the companies cTrader collaborates with, you will notice that almost all of them are true STP/ECN/NDD brokers. FxPro, which is often mistaken for cTrader’s parent company, practices a mixed execution model that I first considered the warning sign. cTarder, on its side, claims it has all the executions records and keeps this info available to traders. The cTrader policy is also to ensure the broker reveals and keeps transparent the information on its execution model as it happened with FxPro.

cTrader and FxPro collaboration on executions model transparency

cTrader functionality is a whole different topic for discussion so stay tuned if you want to know more of the platform’s pros and cons.

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Dan Sidonius

Dan Sidonius

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