Brokers

When trading in the Forex Market we soon realize how important it is to be trading with a decent broker. As many brokers and banks take the risk of some trades it is very important to pay attention to see if you are not being misled with execution. This is probably one of the best pages on this website, so I suggest toread with careful attention.

A few things explained.

What is ECN Broker?

ECN stands for Electronic Communications Network. This means that the broker gets from the market the best BID and ASK and simply transmits the order of the client to the market, not taking a position against him.

What is a Market Maker?

A Market Maker is a broker that takes the risk of its clients. This means that your order stay in the brokers book, if you lose the broker makes money, if you win the broker loses money. Market makers are not the preferred choice of many traders, but it doesn’t mean it is all that bad. You might even have a better execution then with a ECN broker. It really depends a lot on what the market maker is doing and how and how the trades are.

What is STP?

STP stands for Straight Through Processing. In this case the broker can either take the risk of your trade or send it to the market. But is a good option if you have an automatic system or other that requires fast execution, as it is all automatic and in theory they don’t have a dealing desk.

What is Dealing Desk, and what do they do?

A Dealing Desk are traders that verify your orders before execution. This is commonly used by market makers to trade against its clients. It is also true that they can help you. Sometimes you might want to put a trade of 50 lots when the market doesn’t have much liquidity, at this point the dealing desk will take the risk and send this order to the market in smaller trades protecting you from the risk of big slippage.

There are a growing number of brokers out there, so here are some of the things that you should look for before you open an account.

1-     Regulation, where are they regulated? And if possible check their history (the best regulator is without doubt the FSA)
2-      ECN and STP execution
3-      Competitive Spreads
4-      Deposit facilities (normally brokers that accept any kind of electronic money such as paypal, ewalet, etc, are not the best)
5-      Location of servers
6-     Customer service, how long does it take to process a withdrawal and what are the fees?

Please find here a list of our recommended brokers:

1- Hantec Markets

Hantec Markets is a broker originally from Hong Kong that has established itself in London as one of the main institutional brokers in the City. For this reason they are fully ECN and even retail clients will benefit from that. I have been trading with them and I could not be happier, and that’s why it is the first broker on my recommendation list.

 

HANTEC MARKETS
ECN Yes
FSA Yes
EAs Yes
Spread E/U 1.8
Scalping Yes
MT4 Yes

2- SVS Securuties

SVS Securities is one of the most complete brokers in the market. The company’s product range includes advisory CFDs and UK Stocks, Emissions Trading, Corporate Finance and Forex. They offer a no dealing desk service with ECN conditions. There’s also a web based platform which is ideal for new entrants to the Forex world.

SVS SECURITIES
ECN Yes
FSA Yes
EAs Yes
Spread E/U 1.6
Scalping Yes
MT4 Yes

 3- Tradenext Limited

The fastest growing and most innovative broker in the market.  Tradenext offers FX, Commodities and CFDs and have developed a brand new platform taking the best features of Currenex and MT4 and created iTrader.  Full of additional features and the best execution on the market. Tradenext definitely stands as a brand apart.

TRADENEXT LIMITED
ECN Yes
FSA Yes
EAs Yes
Spread E/U 0.4
Scalping Yes
MT4 Yes

4- Alpari

Alpari have been growing fast in the last few years, spreading its operations around the globe. They are certainly becoming a more professional broker with access to a great variety of markets and have very good institutional conditions and services. Never the less if you are a retail customer your conditions are not quite the same. Alpari, being a Russian company have a very close relationship with MetaQuotes, so specially if you are using MT4, pay attention for manipulations on news, market openings and so on.

ALPARI
ECN Yes
FSA Yes
EAs Yes
Spread E/U 1.6
Scalping Yes
MT4 Yes
Max Leverage 1/500

 

5- Mig Bank

This is another fast growing broker that became a Bank due to the changes in the Swiss regulations. Since recently they also got the FSA regulation. I recommend them because they have a good range of products and even if in my opinion they don’t offer the best execution, they are a trusted broker. It will depends a lot on your trading strategy if you can be successful with them or not.

MIG BANK
ECN Yes
FSA Yes
EAs Yes
Spread E/U 0.8
Scalping Yes
MT4 Yes
Leverage 1/100

 

 

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