In forex trading, the two most important factors that can lead you toward success are accessibility and liquidity. Most “traditional” brokers that you see in the market are “dealing desk brokers”, meaning they act as a middleman between the trader and liquidity providers such as banks, traders and other brokers. Read More
There are numerous benefits for traders to use ECN brokers if it’s done properly. If you are willing to cut out the middleman from your trading, it would be a good idea to consider a brokerage that offers a comprehensive ECN system as a part of their service offerings. However, before you do so, make sure you go through this comprehensive guide on ECN brokers. In simple words, ECN is a network that brings together various market participants under one platform enabling them to buy and purchase forex with each other. ECN brokers offer automated and algorithmic networks for traders to have direct access to the forex market. There is no dealing desk involved. Thus the traders can directly participate in the market to search for the best buy and sell prices. Many brokers are market makers and charge a “spread” in exchange for the services offered (such as facilitating forex trades). However, when you use an ECN broker, you pay a low spread. Often, you don’t have to pay anything at all with an ECN broker. The reason is that ECN brokers directly publish orders entered by numerous market participants to individual traders as well as third parties. Such orders can then be executed automatically through an algorithm that can match the buy and sell orders at the best available price in the market. Thus, ECN has broken the barrier for traders to access the forex market by efficiently bringing traders (both individual and institutional) and liquidity providers in the same place. One can name numerous reasons for the popularity of ECN brokers among traders. Certain types of traders don’t agree with the forex spread system because it enables the market makers to fix their prices independently. They see this pricing policy as rather non-competitive, which puts them at a disadvantage. In addition, spreads are hardly ever transparent, meaning it’s not clear why traders are being forced to harbour certain spreads. At the same time, ECN brokers offer a highly competitive and fair pricing system where buy and sell prices are determined through an auction. Trading forex with a cysec forex brokers, you may feel secure and at ease knowing that your funds are secure. Additionally, an ECN broker never takes a position against the trader, something which is a regular practice for standard brokers. Hence, if you want to avoid some of the most frustrating aspects of market makers, such as delays due to liquidity and expensive re-quotes, ECN brokers are the best choice. These are some of the main reasons for the rising popularity of ECN brokers in recent years.Who Is An ECN Broker?
Why Is ECN So Popular?
Pros Of ECN Brokers
Cons Of Forex Brokers
In forex trading, the two most important factors that can lead you toward success are accessibility and liquidity. Most “traditional” brokers that you see in the market are “dealing desk brokers”, meaning they act as a middleman between the trader and liquidity providers such as banks, traders and other brokers. Read More
