Advantages of a non-ecn broker

Beginner Questions
1

Just wondering what are the advantages of a non-ecn broker, if there are any?

Thanks for the reply’s

2

Check out this thread > http://forums.babypips.com/newbie-island/8233-what-ecn-trading.html

Discusses Ecn’s. Be sure to check out the link to the Forex Factory thread about Ecns vs Market Makers that Terry put up.

3

N/T have you seen a brokers comparison, what do you think?

4

pros and cons of trading w/ a market maker and an ECN
[B][I]MARKET MAKER[/I][/B]
Pros:

* The trading platform usually comes with free charting software and news feeds. (For related reading, see Demo Before You Dive In.)
* Some of them have more user-friendly trading platforms.
* Currency price movements can be less volatile compared to currency prices quoted on ECNs, although this can be a disadvantage to scalpers.

Cons:

* Because they may trade against you, market makers can present a clear conflict of interest in order execution.
* They may display worse bid/ask prices than what you could get from another market maker or ECN.
* It is possible for market makers to manipulate currency prices to run their customers' stops or not let customers' trades reach profit objectives. Market makers may also move their currency quotes 10-15 pips away from other market rates.
* A huge amount of slippage can occur when news is released. Market makers' quote display and order placing systems may also "freeze" during times of high market volatility.
* Many market makers frown on scalping practices and have a tendency to put scalpers on "manual execution", which means their orders may not get filled at the prices they want.

[B][I]ECN[/I][/B]
Pros:

* You can usually get better bid/ask prices because they are derived from several sources.
* It is possible to trade on prices that have very little or no spread at certain times.
* Genuine ECN brokers will not trade against you as they will pass on your orders to a bank or another customer on the opposite side of the transaction.
* Prices may be more volatile, which will be better for scalping purposes.
* Since you are able to offer a price between the bid and ask, you can take on the role as a market maker to other traders on the ECN.

Cons:

* Many of them do not offer integrated charting and news feeds.
* Their trading platforms tend to be less user-friendly.
* Because of variable spreads between the bid and the ask prices, it may be more difficult to calculate stop-loss and breakeven points in pips in advance.
* Traders have to pay commissions for each transaction.