Can brokers piggyback on their customers? | Reviews of Brokers and Data Feeds - futures trading strategies, market news, trading charts and platforms

Reviews of Brokers and Data Feeds

Review and discuss futures brokers, their requirements and features, or ask questions about brokers and data feeds


Can brokers piggyback on their customers?

  #25 (permalink)

Sydney, Australia
Trading Experience: Intermediate
Platform: Sierra Chart, IRESS
Broker/Data: IB, IQFeed
Favorite Futures: ES, SPI, ASX stocks, options
Posts: 399 since Jun 2015
Thanks: 169 given, 460 received

jdox View Post
I don't see anything in any of my posts implying that brokers are thieves by nature. I simply asked if it was possible for a broker to do this if they wanted to. As I mentioned, if people had access to trades that some of the top retail traders are making, I would certainly think someone would be tempted to do it. Look at all the people who come on this forum trying to find trading rooms. Thats exactly what they want...someone to call the trades and they follow along.

I agree that it's helpful if they buy/sell afterwards. I would expect if they did it, they would front run the person, if able.

This is what I was getting at when I asked the question. I figured there must be some kind of rule in place but nobody else mentioned that so thanks for that info. Is there anyway that this rule is enforced?

In that case then yes, brokers have access to flows of their clients and the seniors have access to flows of all clients. The insto's are also very loud so I can hear what their lines are for the day.

It is enforced (at least in Australia). There are compliance systems in place that can detect that kind of stuff.

We are strictly told to enter in trades for personal trading after client orders, and we do that a lot - but this is generally due to us giving advice and then trading on our own advice (but we have to execute last).

In terms of front running someone who trades on their own behalf, it's next to impossible unless as @artemiso has mentioned, their trading is predictable down to the minute, but then that's not an edge - that's just someone trying to do business.

Trying to reverse engineer a winning traders system just by his executions would be too hard or impossible.

Visit my futures io Trade Journal Reply With Quote
The following 4 users say Thank You to PeakGrowth for this post: