Why would you want to hide your stop loss from your broker?
In this post, I’ll show you why some traders do this, how to do it, and the situations where it makes sense.
If you prefer the text version, it’s provided below the video.
Why Hide Your Stop Losses From Your Broker?
Not all traders will benefit from hiding their pending orders.
There are 3 reasons why you might want to hide your stop losses.
1. Conceal Your Trading Strategy
If you have a trading strategy that works really well and you don’t want other traders (or your broker) to reverse engineer it, then you might benefit from concealing your orders.
This is especially true if you publish your track record on MyFxBook or a similar copy trading or reporting platform.
Your broker will be able to see your initial entry and final exit level, but they won’t know if you closed the trade manually or if it was a pre-set order.
2. Prevent Intentional Slippage
I’m not saying that all brokers do this but…
…a few do.
So if you are consistently profitable and you are not making as much money as before, then your broker could be slipping you intentionally.
There may not be a way around this and you may have to switch brokers.
However, one way to potentially prevent this is to hide your entry and exit orders.
If you think that your broker is doing this to you, try hiding your orders and compare your results.
3. You Have Very Large Trade Sizes
Traders who have very large trade sizes will benefit from hiding their pending orders. If their trades are on the broker’s books, other large traders can temporarily move the market to hit their orders or ride the order flow.
Large traders typically break up their entry orders, enter them in small chunks, and spread them out across multiple brokers.
Some dodgy, unregulated brokers can also trade against large trades or hunt stops to their benefit. Regulated brokers won’t do this.
How to Hide Your Stops and Other Pending Orders
There are 2 ways to hide your orders.
The method you use will depend on your budget, needs and available resources.
Create a Custom Order Execution Platform
You can create a custom platform that talks to your broker’s servers via an Application Program Interface (API). This is the more complex and expensive way to go, but it is also much more customizable and scalable.
Almost all brokers and trading platforms have an API that you can use to build your own trading platforms.
You can use whatever development platform and programming language fits your situation and host it on one of your servers or use a hosting service like AWS.
Here are a few examples of trading APIs:
Create a Custom MetaTrader Expert Advisor (EA)
Another way that you can do this is to create an Expert Advisor for MetaTrader. This is generally easier and cheaper.
You simply upload your EA to a Virtual Private Server (VPS) and have it running 24/7. Just be sure to pick a reliable VPS and setup alerts so you know when your server is offline.
To see which VPS we recommend, visit our resources page.
One stop loss and take profit manager EA that I’ve been testing is the Fortress EA. It’s really cool and has been working well so far. See the video above to learn how it works.
In reality, not all traders will benefit from hiding their stop losses and pending orders.
However, if you fall into one of the categories above, this post will get you started on the right track.
There is a common misconception that you should hide your stops so your broker doesn’t stop hunt them. This is a myth and any reputable and regulated broker won’t do this.
They want to have you as a customer for as long as possible because they make money on your commissions. So it’s in their best interest to not stop you out all the time.
If you have any questions about hiding your pending orders, leave a comment below…
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