If you are not a beginner in Forex, you probably noticed more than once, as the price of the same financial instrument on a single broker differs markedly from another broker And later equalized prices on both brokers. This is particularly noticeable at the jump volatility, important news, and sometimes in a quiet market.
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Why is that you ask? Everything depends on the liquidity provider. Each broker has his own. That’s why there are gaps (hovering) quotations. Another reason is the imperfect transmission algorithm quotations in MT4. Brokers to interact with the liquidity provider use Bridge, which is significantly delayed transfer of data (quotes). Of course, you will not notice this lag on the eye. It is too small, and especially do not have time to enter the trade. Therefore, only A robot able to make a profit.
Arbitrage opportunities (Arbitrage Forex) is 100% profitable position that allows you to install a large lot size and a small stop loss. So do not be surprised when Arbitrage Robots has 100-500% profit in 2-3 days and a massive risk to the transaction. But not as easy as it seems. The broker is not like how high-frequency experts work, and in most cases, the broker pays the profit out of your pocket, so it prevents all the ways this kind of trade.
A simple summary of this is the Arbitrage technique allows you (Robot) to look into the future for fractions of a second . because of the latency of the broker.