ECN vs Standard account P/L

Beginner Questions
1

I’m little confused over the P/L in ECN and Standard accounts.

Suppose I have both ECN and standard accounts. I buy 0.2 lot of EUR/USD. Now if price moves 10 pips up in both the account what will be my P/L. As per me it will be calculated as below. For the ECN account commission is $6 round turn per lot.

ECN Account

  • P/L will be $20 (10 pips * $1 per pip * 2 lots)
  • Commission $1.2 ($6 for 1 lot so $1.2 for 0.2 lot)
  • Final P/L $18.80 ($20 - $1.2)

Standard Account

  • P/L will be $20 (10 pips * $1 per pip * 2 lots)
  • Commission $0
  • Final P/L $20 ($20 - $0)

So my question is why do people choose ECN accounts? As per above calculations, for the same pip movement, standard accounts will give more profits. I know there is very low spreads on the ECN but do they justify it?

Please help me clear this doubt.

2

Its usually more epensive to trade on the standard account.

Because the spread is higher.

There is something wrong with your comparison.

The cost of trading is the spread + fixed commission on the ECN.

On the standard it’s just the spread which is usually higher.

Example,

ecn = 0.1 pip spread + 0.6 in commission as the equivalent spread = equivalent spread of 0.7 pips.

Standard = 1.0 pips spread.

So your PnL will be higher on the ECN account.

I hope this makes sense.