Speed is everything in trading, especially during major news events. Traders who specialise in news trading rely on instant execution to capitalise on rapid price movements. However, a troubling practice occurs when a broker injects latency on known news traders. By deliberately slowing down order execution, brokers can sabotage news traders’ strategies, prevent profits, and protect their own interests. Recognising this tactic and knowing how to respond is essential for serious traders.

Why Would a Broker Inject Latency on News Traders?

News traders exploit the sharp volatility caused by economic releases like Non-Farm Payrolls, inflation data, and central bank announcements. Brokers sometimes view news traders as a threat because:

• Exposure to unhedged risk: During news spikes, brokers might struggle to manage risk, leading to losses.
• Bonus abuse concerns: Some brokers offer bonuses and worry that news traders will cash out quickly after short-term gains.
• Protecting liquidity providers: Liquidity providers often pass slippage costs onto brokers during high volatility.
• Reducing profitable clients: News traders who consistently win during news events can hurt the broker’s bottom line.

When a broker injects latency on known news traders, they add intentional delays to orders, reducing the trader’s ability to enter or exit the market at optimal prices.

The Risks of Broker-Induced Latency

Slippage and missed opportunities:
Even small delays can cause orders to execute at much worse prices than expected.

Invalidated strategies:
News trading strategies rely on ultra-fast reaction times. Latency renders many setups ineffective.

Unexpected losses:
In fast-moving markets, delayed execution can turn a winning trade into a losing one instantly.

Loss of trust:
When a broker manipulates latency, it fundamentally breaches the trader-broker relationship.

Regulatory breaches:
Regulators like the Financial Conduct Authority (FCA) and the Australian Securities and Investments Commission (ASIC) prohibit unfair trade execution practices.

Signs That a Broker Is Injecting Latency

Execution delays only during news events:
If your trades are processed normally at other times but slow drastically during news releases, latency manipulation is likely.

Repeated slippage during high volatility:
Consistently poor fills during key announcements without technical justification can signal broker interference.

Trade rejections:
Orders are delayed, modified, or rejected during crucial moments despite sufficient account margin and stable internet connection.

Broker terms against news trading:
Some brokers mention restrictions on “news trading” in their terms and conditions. Others do not state it openly but act against news traders in practice.

What to Do If You Suspect Your Broker Is Injecting Latency

Document trade execution times:
Take screenshots of order timestamps and compare them to market events. Reliable platforms like MetaTrader 4 and MetaTrader 5 display server response times.

Use a low-latency internet connection:
Ensure your connection is stable and fast so the broker cannot blame local network issues.

Contact customer support:
Ask for explanations about any execution delays during news events and request trade execution logs.

Escalate complaints:
If you gather evidence of manipulation, file a complaint with the broker’s regulator. Brokers like Intertrader, AvaTrade, TiBiGlobe, Vantage, and Markets.com are required to execute trades fairly and transparently.

Switch to a more transparent broker:
If the broker injects latency on known news traders, it is a clear sign to withdraw your funds and find a platform that respects all trading styles.

How to Protect Yourself Against Broker Latency Manipulation

Choose an ECN broker:
Electronic Communication Network (ECN) brokers pass orders directly to liquidity providers without manual intervention, reducing the risk of intentional latency.

Trade with well-regulated brokers:
Top regulators enforce best execution rules to protect clients.

Use a VPS (Virtual Private Server):
A VPS near your broker’s server location can reduce genuine latency and strengthen your evidence against broker-induced delays.

Test broker execution before depositing large funds:
Conduct small news trades first and monitor execution speeds carefully.

Review independent trader feedback:
Look for comments about execution quality, especially during news events, before choosing a broker.

Conclusion

When a broker injects latency on known news traders, it disrupts legitimate trading strategies and undermines trader trust. Traders must stay vigilant, document execution behaviour, and choose brokers that provide fair, transparent trade processing. Protecting your speed and precision is key to success, especially when trading news events.

Develop the skills needed to defend your trading edge and navigate broker risks effectively by joining our Trading Courses. Empower yourself to trade with confidence, speed, and full control today.