Are there any exceptions to the fixed-spread policy?
If you read the fine print, there may be. And if so, it's like you are paying for insurance without getting full coverage. Make sure the exceptions are clearly spelled out. Precisely spelled out. And find out when the policy on exceptions has last changed so you can gauge how frequently they may change the rules.
OANDA's response:
OANDA does not offer fixed spreads. It offers the same variable spreads to everyone, with no exceptions.
Are there any restrictions on trading or entering orders around news announcements?
Again, if there are, then it's like you are paying insurance for nothing. Make sure any restrictions or conditions are clearly spelled out.
OANDA's response:
On OANDA FXTrade there are no restrictions on trading or entering orders around news releases.
Do the spreads differ depending on ticket size?
In the interbank market, spreads are often wider for larger ticket sizes. When you review typical spreads, it is important to understand if spreads vary depending on ticket size, and what the spreads are for the various ticket sizes. All too often, brokers offering matching platforms will display very tight spreads, but these spreads apply only to very small ticket sizes.
OANDA's response:
On OANDA FXTrade all spreads are the same, whether the ticket size is $1 or $10M or anything in between. (FXTrade does not support ticket sizes above $10M at this time; in order to trade larger amounts, trades must be split into tickets of $10M maximum.)
Do all clients on your platform get the same spreads?
Or does the spread depend on who you are, how large your account is, or who introduced you to the broker?
OANDA's response:
OANDA does not discriminate among its clients. All clients trading on FXTrade at the same time get the same spread.
Are there clients who get rebates or volume discounts?
Even if everyone gets the same published spread, are they really? If some clients are getting rebates or volume discounts, guess who is paying for them? If different clients are getting different spreads, then find out what you can do to join the privileged group getting the best spread.
OANDA's response:
On FXTrade, everyone gets the same spread. Period. No one gets any form of rebate or volume discount. Instead, we work on reducing the spread further for everyone.
Does a portion of the spread for any client go to anyone other than the firm?
Forex brokers frequently agree to pay third parties (for example, the introducing brokers or sales agents) a portion of the spread on your trading activity. While some firms argue that their introducing brokers are not really getting a portion of the spread, don't be fooled. Ask if the introducing broker is being paid in direct proportion to your trading activity. There is nothing inherently wrong with this practice, but it is a fact worth knowing. Only then can you decide if the introducing broker is providing enough added value for the amount you are (indirectly) paying him. And you should also ask if you could get better spreads by cutting out this middleman and trading directly.
OANDA's response:
The spreads on OANDA FXTrade are already very tight, often tighter than the interbank market spreads, so there is no room to give anyone a piece of the spread. In particular, OANDA does not pay introducing brokers, sales agents or anyone else any portion of the spread.
Does anyone other than the firm itself get paid as a result of your trading activity?
You'd be surprised, but some firms pay their traders and sales agents in proportion to the firm's profit on your trades—a nice conflict of interest that raises inevitable questions about quality of execution.
OANDA's response:
OANDA does not pay any third party as a result of your trading on FXTrade.
Does the broker provide an open, uncensored forum where their clients can post their trading experiences?
Open, uncensored forums are a good place to get an initial understanding of what existing clients think of the broker's platform and quality of execution. It is important to have access to all posts for at least the last 12 months. If this sort of information is not available, ask why not. And note that "chat rooms" are something different, typically because their purpose is to avoid warehousing the historical information you may want to review after the fact.
But beware: since the Internet allows for anonymity, it is often very difficult to determine who is really behind writing a post. How do you separate real concerns, real problems, and real compliments from, say, posts by agents working on behalf of a particular broker? There are some generally recognized guidelines. Count the total number of posts made by any individual, and read some of their previous posts to judge their credibility. Discount extreme comments by traders who are new members or who have posted only a few messages. These individuals are most likely guerilla marketers who blitz forums, sometimes overtly, at other times covertly.
OANDA's response:
The OANDA FXMessage forum at
http://fxtrade.oanda.com/community/forex_forums.shtml keeps every complaint ever posted by our clients. You will also find many compliments and insightful comments. After reading a few pages, you'll wonder why other firms don't have a forum like this.