Hey F, one correction. ECN is Electronic Communications Network, any broker that has an electronic “platform” that is on your computer or mobile device, uses an ECN, of course they will take phone orders and faxes, but the most common way for a broker to receive your order is by “ECN”. ECN is a piece of tech not part of the “back end” execution.
The Ever Hanging Out VIPER
That’s not right. ECN doesn’t mean any old electronic network, it’s a specific type of electronic network that matches buy and sell orders between clients, rather than the broker taking the other side themselves. It generally results in tighter spreads and a fixed commission structure. A broker who uses software (every broker on the planet) doesn’t make them an ECN broker, anymore than me being a truck owner also makes me a Ford truck owner.
I don’t think you can regulated to offer Crypto at 100:1 leverage can you?
Which I like.
Nope, we disagree, and by the way I have owned a company that was an I.B. I am not going to debate this with you.
I actually think it would best best for both of us for you to stay off of my responses, and I will stay off of yours. By the way FG is a big boy and can defend himself.
The Ever Slithering VIPER
Without opening a can of worms here, and without backing my own broker, here is a screen shot summary which is quite useful…
The key phrase being “However, ECN refers to the anonymous communication between executing counterparties” - more akin to what FG stated, and not so much front end communication via placing trades.
FX pro take online, phone and fax orders, but they also state they are not ECN?
But, that’s just my 10 pence worth of added value
Hey B, well, it depends on how one defines ECN.
Remember that the NASDAQ basically started the ECN concept. Back in the good old days on the NASDAQ you could target the AXE, because again, when the NASDAQ got started their goal was to make an open and fair system for trading. Sooooo on L2 you could actually ID the Market Maker/Axe, and target them, this also allowed you to fade or shadow them. Of course, GS, CANT etc. Did not like this and they decided that the NASDAQ should provide an anonymous platform, which they complied with, and the edge of seeing who was executing what, or better said who was making the market on what, was brought to a tragic end. Which is why today L2 is no where near as powerful as it was in the beginning, if you talk to anyone who was trading back then, they will tell you.
Again, NASDAQ’s original concept of an ECN had the market makers name or designation on L2, so it was not anonymous. My Currenex feed is also NOT anonymous, I can actually see who is out there, 3 Primes and my broker, I can also communicate with the desk guys if I want, run RFQ’s, RFT’s, Iceburgs etc. My broker does not touch the order other than provide access the PB’s, or I guess the in word now is Liquidity Providers “LP’s”. So it is not anonymous, but it is not touched by my broker, so what is it, by Spot Currency standards it is an ECN.
So the term ECN has morphed into various meanings. What I refer to as ECN, is what the definition has come to mean within Retail Spot, basically a platform where your order does not go to a dealing desk first, then cleared. Now the execution process, or “back end”, that is a different story again STP, Hybrid STP, Hybrid Corn, no wait the last one if for this spring.
So defining an ECN as anonymous, is only one definition, originally the NASDAQ ECN was not anonymous.
The Ever Wondering Where My Sizeable Fonts Are VIPER
Have you used an iceberg order, I should imagine that’s where it really starts to get interesting… but more so in low cap stocks I should imagine, even with a substantial retail bankroll.
The main point I’m trying to make is how misleading the term “ECN” is used by retail forex “brokers”.
Retail forex traders do not have direct access to ECNs, such as FXall, FastMatch, Reuters, EBS Direct, ParFX. 360T, etc.
So you’re not trading “directly” in the market which is what some “ECN brokers” like to advertise.
Your broker itself may have access to the ECN, but you’re still executing your trade against the broker. Your broker is still your counterrparty.
Will the broker offset your 1,000 unit trade with its prime broker (PB) or prime of prime (PoP)? So it’s not “trading against you”? Highly unlikely since it doesn’t make financial sense.
Also, brokers sometimes like to make it sound like an ECN is “the” market like there’s a central location for FX, but an ECN is just a bunch of liquidity providers (LPs). And there are lots of ECNs. Theoretically, if you can get a bunch of LPs together, you can create your own ECN.
Who is part of the ECN is important and will determine just how representative the prices are relative to the overall market. It could even be possible that there aren’t even any Tier-1 LPs in the ECN. Which means the broker is aggregating price streams from the ECN but not one of them is coming from the big banks.
This is exactly what comes to mind when looking at retail brokers who state “ECN Environment” - a subtle difference form actual ECN participation. I’ll go as far to say that IC Markets are an example that jumps out to me, all you have to do is look at there home page… and accounts from as little as a few hundred US dollars 
misleading, or the truth? you can decide - again notice the “True ECN Environment” [highlighted yellow in the lower text paragraph]
My guess is that they take the other side [or offset internally with clients], but artificially provide you with the ECN environment - after all it’s the buzz word that all retail traders seem to look out for these days, right?
They provide you with LP price feeds for both bid and ask, but that’s where the buck stops… it’s taken no further.
This is a public forum. I don’t think any more needs to be said about that.
I was not defending FG, just jumping into the discussion as many others have.
I can’t quite figure out why you got so triggered from my post, but I hope you get over it.
This is all good stuff. Thank you for grabbing screenshots from the various brokers.
Hehe, you are funny thats for sure.
The Ever Chillin VIPER
I appreciate the insights in the thread. We have to be concerned with fills and withdrawals and the reputation of the broker, I feel, more than whether or not ECN.
I think the broker I use advertises ECN, my greater interest is how they look after me when I have a difficulty, not their advertising campaign.
Which of the broker please
The first thin g that a trader needs to do is to find a right broker who can give them huge benefits in the future. You people are advised to choose the broker which has reputation on the forex market and you have trust in his actuality and fuctionality.
Pure ECN brokers are those brokers who provide the access to the deepest liquidity pool and tightest spreads starting from 0.0 pip. They never trade against the client and earn profit by charging lower commissions and fees. They limit price manipulation and provides with the best market prices. They provide good execution speed with lower latency
Not an easy job to find one, but the real ECN broker would offer offers a clear platform where traders, banks, organizations can play against each other. Usually they can send bids and offers to each other. Also usually traders are getting their best deals for their order at the particular time.
Dont fall for the marketing used by brokers or fashionable buzzwords.
You will be trading on an “ECN” when you are a consistently profitable trader. The broker will not risk keeping your order in house but they will take their commission and pay a small fee to process your order with a liquidity provider… Consistently profitable traders are like hot potatoes. Everyone is trying to pass on the risk to someone else.
If you are a consistent loser, your deals remain in house because you contribute more positively to the brokers P n L.
Its as simple as that and they have the tools to determine who is a risk and who is not. If you want to trade on an ECN, be consistently profitable.
CPA’s (cost per acquisition) are high in this industry. In the hundreds of Dollars per client. Do you think they can recover these costs, plus their other overheads from micro lot traders ( $200 deposits) generating 7 cents in commission per trade? These traders hardly generate a few round turn lots in commission for the broker before blowing their accounts. Many, probably never to be seen to deposit to trade again. Even many of those who deposit a few thousand Dollars wont generate hundreds of Dollars in commission before blowing their accounts.
Its far more profitable to keep the majority of traders orders in house because we all know the majority lose. Regardless, the pricing between the two, ECN or in house is the same. You wont know the difference.
Dont blame the broker for making a business decision to maximize their profits. The industry is very competitive.
Irrespective of this. The big banks and liquidity providers make the market, they are market makers and they are at the top of the food chain.
You either trade with or against a market maker. There is no getting around it.
hello jibby,
true ecn broker,have never manupulate price and they direct provide your trades to bank and institutions,you can also see their quoted price in market watch for spread,if the spread is too much in news time the broker is not good ,i recommond you to try forexchief ,beacause it is true ecn broker.and also their quoted price is good not high spread becaouse of true ecn
Hi, I’am at beginner level in trading though there is risk involved, i know but wanted to make use of the money in a suitable way, and even i want genuine broker to trade, how do i know who is real and fake, would you have any broker in mind that comes, who has an certified ASIC and has been in the market for a long time.
