
Know Your Forex Broker’s Hedging Policy Do you know your forex broker’s hedging policy? For every forex broker, each and every trade entered into by its customers […]

Reverse Hedge. Another variant of C-Booking is the reverse hedge which is when a customer’s trades are either partially or completely reverse hedged. This practice is […]

Over-hedge. Let’s take a look at what an over-hedge is. C-Booking is not limited to partial hedging. Another variant of C-Booking is when a broker can […]

Partial Hedge. The most common form of “C-Book execution” is the partial hedge of a customer’s order. A broker can hedge market risk in part and not […]

C-Book and How Forex Brokers Manage Their Risk. Now let’s take a look at C-Book and how forex brokers manage their risk using it. Aside from […]

Most Forex Brokers Use a Hybrid Approach. Most forex brokers use a hybrid approach. We don’t see anything wrong with a broker operating both A-Book and […]

Large Forex Brokers. For larger forex brokers, because they have many customers opening trades in both (long and short) directions, they are able to internally offset […]

Customer Profiling in the Hybrid Model. Let’s look at customer profiling in the hybrid model. The forex broker has to decide which customers go to A-book […]

The “Hybrid Model” Used By Forex Brokers. Let’s review the hybrid model used by forex brokers. In the previous lesson, we talked about why forex brokers are […]

What B-Book Brokers Don’t Like. Customers Who Win Consistently B-Book brokers don’t necessarily like customers who win consistently. These customers will grow their account balance over time. […]

What B-Book Brokers Like. A large number of similarly sized customers. B-Book brokers prefer to have a lot of similarly sized customers who trade as frequently as […]

How B-Book Brokers Make Money. You buy from the broker and sell to the broker. If you make money, the broker loses money, and vice versa. […]

Why Do Forex Brokers B-Book? Let’s take a look at why do forex brokers B-Book? And let’s start with the question, what is a B-Book broker? […]

Managing Residual Risk. Let’s look at managing residual risk from a forex broker’s perspective. They can manage it in two ways: The broker can transfer this […]

Internalization. Let’s continue our discussion of internalization. For example, the broker can see in its book that it has a total of 10 million units of long GBP/USD […]

Internalization. Let’s examine internalization, which is how forex brokers aggregate orders and hedge residual risk. How Forex Brokers Aggregate Orders and Hedge Residual Risk. With A-Book […]

Riskless Principal. When a trade is executed via STP, this type of transaction is known as a “riskless principal” or “matched principal” transaction. What is a […]

STP Execution. Let’s see how STP execution actually works. A-Book vs. STP A trade that is “A-Booked” is sometimes associated with being “STP’ed” or simply “STP”. […]

STP Execution: How Forex Brokers Manage Their Risk. Let’s explore STP execution and how forex brokers manage their risk using it. A-Book brokers are sometimes also […]

Challenges of A-Book Execution Continued Let’s continue our discussion from yesterday’s discussion of the challenges of A-Book execution. If a broker is going to rely on […]

Challenges of A-Book Execution. The A-Book execution model comes with its own unique challenges. An A-Book forex broker can only earn profits from markups IF the rates at which […]