Rating brokers with ECN accounts
Typically, brokers on the stock exchange act as intermediaries between buyers and sellers. Those of them who seek to reduce its involvement to a minimum, directly linking traders for each transaction, called ECN brokers as they use electronic communication network (Electronic Communication Network). On this page is a list of the best Forex broker with ECN accounts.
Obviously, with the ideal trading market completely absent overhead expenses from the seller and the buyer. But in reality this is not possible, as is required for transactions broker (from the English broker -. Broker, intermediary), which derives its income from this activity. It is a party to every trade and offers customers realize trading operations, which already incorporated its profit. There may be two options for the implementation of customer trading orders:
- When a trader is guaranteed pursuant to the application, but not guaranteed price at which the transaction will be carried out. This embodiment is called "Market Execution» (Market Execution). Depending on the circumstances, the price of an asset may not be better or worse than requested. For customers, this means that there is a "slip";
- Broker warrants exercise price, but can not perform the application at all. This type of trading orders is called "Instant Execution» (Instant Execution). The trader can offer to execute an application already at the current price, ie "re-quotes".
In both cases, a normal intermediary opposes the client and offers him a deal with the spread, that is, at a price which differs from the best offerings on the market, so that in this way to get your income. The advantage of a broker with ECN accounts is that it binds the seller and the buyer directly, providing the value of the assets that actually are on the side of supply and demand. This is possible thanks to the presence in a single trading network ECN large number of small and large customers (banks, stock exchanges, funds, large companies and individual traders), which collectively provide the best liquidity and the best trading conditions.
Working conditions ECN network, the brokerage company does not need to be changed arbitrarily increase prices and thus spread. Her income consists exclusively of fixed commissions, and this ensures full transparency of the trading process, the inability to play against the customer or in any way modify the flow of real quotes. But the novice trader needs to understand that there is no guarantee at the same time a constant narrow spread. In the news release the time it can be much greater than the one provided (with sliding and requotes but unchanging) standard accounts. By choosing a broker it is necessary to approach taking into account the personal trading style and strategy.