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Archive for the ‘Forex Trader’ Category

Triangular Arbitrage using Bid Ask Quotes

Have you ever wondered how to determine how to compute the triangular arbitrage formula using bid and ask quotes?  Using four simple rules it is possible to compute triangular arbitrage relationships using bid and ask prices. Three example computations for three different symbols are presented with an intuitive description of how to interpret the results in terms of identifying inefficiency, including the triangular arbitrage “risk free” opportunity, as well as the opportunity to transact at a better price using the synthetic than the underlying, even when no real arbitrage opportunity exists.

Triangular Arbitrage with Bid Ask Quotes
Triangular Arbitrage with bid ask prices 1000 bid vs synthetic ask quotes

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Calculate Triangular Arbitrage Lot Size

January 23, 2013 2 comments

Have you ever wondered how to correctly size positions between the underlying pair and its synthetics to eliminate or hedge directional risk? This article describes  how to calculate triangular arbitrage lot size to fully hedge all exposure when initiating a triangular arbitrage trade. The arbitrage trade is at the heart of all good strategies that take advantage of inefficiency. In the forex market this means triangular arbitrage, so understanding how to correctly size positions to eliminate or minimize individual currency risk is very important.

Triangular Arbitrage Lot Size

Triangular Arbitrage Lot Size to capture 6 pip inefficiency synthetic pair
What triangular arbitrage lot size should be traded to capture this 6 pip inefficiency?

Trading Search Engine

December 31, 2012 Leave a comment

Try out this specially optimized search engine just for traders of forex, stocks, bonds, foreign exchange and get better results from all your trading search queries.

Trading Search Engine

 

 

Ten Reasons Why Out of Sample Trading System Performance May Be Worse than In Sample Performance

Why do trading systems tend to perform worse on new data?

This is the question so many trading system developers ask. The answer is that there are many reasons why test performance may be much better than live trading results.

Ten Reasons Out of Sample Performance May Be Worse Than In Sample Trading System Performance

Sample Code to Export C# DLL to Metatrader

September 3, 2012 Leave a comment

Have you ever wanted to write a C# DLL for Metatrader? Sample code shows how to create the DLL in C# and how to call that DLL from within Metatrader 4.

Sample code is included in a downloadable Visual Studio project for writing a C# DLL that can be called from Metatrader, just as a C DLL. Check it out.

Code to Export C# DLL to Metatrader

 

Close All Open Orders Script All Symbols in Profit

If you’re looking for a way to close all open orders in MT4 script for open profits, check this out.

Close All Open Orders Script All Symbols in Profit

Pairs Trading MT4 Indicator – Market Formula = Forex Trader + Metatrader

Pairs Trading MT4 Indicator – Market Formula = Forex Trader + Metatrader.

Simple pairs trading indicator for Metatrader 4 named Pairs with Beta for analyzing currency pair spreads. Allows custom multipliers (beta) to be used with the two pairs being analyzed, then plots the spread in a sub window.

For instance if EURUSD and GBPUSD are the two pairs being studied, and the beta for GBPUSD is 1.4, then the following formula would be plotted:

EURUSD * 1.0 – GBPUSD * 1.4 (shown below in dodger blue).

Pairs Trading MT4 Indicator - Market Formula = Forex Trader + Metatrader