Forex brokers trade against you
Surely this is zero sum? So the market maker and client can in fact have a symbiotic relationship, and the market maker can facilitate the clients ability to express his trading ideas without the layers of costs of any of the alternatives. But the idea is out there, so let's have a close look at it.
The market maker could at this point turn around and forex brokers trade against you to the market, as a broker would. If there is anything that gives the 'trading against' nostrum its superficial appeal, it is this period where the market maker is long and the client is short. The market maker is then paid three minutes later at 21 on a passive order. First lets look at why market makers take risk on to their books. Leveraged trading is high risk and not suitable for all.
But then he cannot profitably show the market rate - buying from his client at the market forex brokers trade against you and then selling at the same rate doesn't create a sustainable business, one that can continue to add value to its clients. Different parties can win to a trade, so long as they have different holding periods. Leveraged trading is high risk and not suitable for all.
Differing horizons - or holding periods - is what makes the relationship between market makers and their clients work, and gives the lie to the idea of trading against clients. If the market maker takes client one's trade into his book, there is now a window in which another client may show up and buy on the other side of the spread. But he is not married to it. The forex brokers trade against you maker is then paid three minutes later at 21 on a passive order. Leveraged trading is high risk and not suitable for all.
The suggestion is obviously that you should trade with them. Let's look a little more closely at the period between clients one and two trading. He would like to see another client show up or forex brokers trade against you passive hedging order fill as soon as possible after client one trades to neutralise his risk.