How to identify a true ECN(+STP) broker? how to identify its true business model and they play fairly?

#1

Hiya,

I’m looking into find out How to identify a true ECN(+STP) broker? how to identify its true business model and they play fairly? Is there any similar section in babypips that have this discussion? if not I suggest please adding a broker search tool to be able to filter broker upon our needs as this is missing in this website?
Also if anyone knows the answer how can I search and find out with broker is playing fairly and business model that offered is true?
For example, lots of website offering broker system, how can I understand which one is true ECN(+STP) and how to find its name in Regulatory authority of country if we deemed that they have a certificate from them?
Is there any reputable website that can do this search for me?

Thnx

#2

Simple bro. Read their PDS.

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#3

hiya

thnx for reply. but do you mean Product Disclosure Statement by PDS? even if they write in this, they write a complex statement that can be interpreted in their benefits in case of legal action so this can be trust-able by traders?, I’m not sure actually…

Any idea?

thnx

#4

Thats the one bro. Heres a tip. You’re not trading the market, your trading against your broker. They take the other side of your trade, your risk lies solely with them and them alone. It’s up to you to understand that. You want to play the game then you have to “trust” someone.

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#5

well a true stp / true ecn is supposed to give you acces to the market! …what you’re talking about that;s a dealing desk! how can you say such a thing??? I see you are a veteran member and you say such things :frowning:

and I’ve also seen other “veteran” members act like there are only dealing desk brokers…

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#6

This is reality bro. Most of us don’t and/or shouldn’t open an account with a prime broker.

It is not to say retail brokers are bad. As I said

#7

so I just got off the phone with a “trader” selling a course and he told me basically there are no STP/ECN brokers… so you NEVER trade anything with ANYONE

it’s just you with the wall! and you are placing a bet that something will go up or down…

I am very dissapointed

#8

#9

what? I don t understand man

#10

hiya @jackrayden

I actually don’t exactly know what is benefit of ‘prime broker’ account and how much they may ask for depositing, or deposit is the only requirements for opening such an account or your need licence or recommendation letter from a professional body or referral by them,… to access the true ECN/STP by this way.

BUT, there is some brokers that may be more fair than others and you may search and find them(I couldn’t find the best one myself, so I just working with some brokers by crossing fingers that they hopefully playing fairly). Actually I’m making money but there is a chance that they may waiting for your account reach certain millions the they play unfair and dodge you.

But surprisingly I seen some guys that playing spread betting in UK that is 100% market maker program, but they are making money (they bought new house and car).

I recently seen a broker that is offering fixed spread and they are market makers but some people making money from them too.

Update us is you got new info :kissing_closed_eyes:

thnx

#11

LoL I really liked that part!
Actually there are some pro and cons of both types of brokers and IMO you can make money from both of them. Unless you start making suspiciously high amounts of profits and they flag you or politely ask you to withdraw your profit and go away :smiley:

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#12

Hiya @eyedfondue

Maybe if someone reach a certain level of capital, she can connect to liquidity providers directly by accessing a raw spread through a software {?}
or the same way that brokers accessing raw spread and liquidity, you may able to open a broker account
but just for yourself and your friends. If anyone knows the process, please share?

Thnx

#13

@jackrayden… @campione… More than likely the reality of retail Forex…

forex1.jpg540×743 193 KB

Notice how updates on both Metatrader and Ctrader are fully automated?.. You don’t get to choose… Your still thinking that these trades are being processed together. There are no other real traders involved. No institutions. Just you and the game platform being run by the RFED. Everyone you think your trading against are fabricated by the gaming program.

The price is put in the platform – yes - but the program creates the movement that causes you to lose. In the trading agreement you sign it says you agree to them adjusting the price, the volume your able to trade and the spread- even after a trade has been completed!
They are in control of the prices they tell you - what they upload is used as a guide which their own charts movement uses as a reference - It’s programmed to stay within a certain distance of the feeds movement - fluctuating within that range as needed to get the task of making you hit your margin.

And the number one reason a Scalper can never beat the MM (Counterparty) Brokerages…

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#14

Hiya @Trendswithbenefits

I personally think depends on the broker platform that get the liquidity and pass it to metatrader, metatrader can be in spot forex or in a MM closed deadend that you will lose everything most probably soon. So it’s the broker that can define your trades can leave the platform of metatrader or not. I personally think that is possible for both scenarios.

And question is, how to spot a real ECN/STP from a MM broker with certain amount of accuracy. There are lots of topics discussed on the net and I read some and I personally couldn’t figure out a formula that if you ask certain question and get certain answer, you can spot that broker is a true ECN/STP.

(I’m typing by mobile device and spelling error can happen :wink: )

#15

@campione…

Here is a Link to a simple Finance Magnates (Part 1) - (Part 2) explaination of what market maker STP and ECN brokers really are…

Don’t forget to read the comments below the article, will give you an indication just how pervasive some of the retail FX myths are…

See the video below with another demonstration and debunking of some BS out there…

Note: Take no notice of the list of Brokers shown at the end of this video…DYOR…

Take a look at some of the other videos on YouTube on this subject…

Eye Opening for the Uninitiated…

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#16

Hiya @Trendswithbenefits

Thnx! I read part2, and as I heard before, it’s again persisted on if you see the Depth of market, then it’s ECN. But I wanted to say, it could be ECN only, not definitely. As MT5 providing DoM, then with every broker that you see the DoM, the itsECN? (Based on article outcome in part2 ). I wanted to say, it could be only. Not?

Thnx

#17

Hiya @Trendswithbenefits

In article part2 indicated that, Uk brokers are true and fair, but I have doubt about it. I didn’t know any reputable Bank in UK who offering FX trading itself. I just heard about one but I couldn’t get access to their platform and registration yet. Actually I don’t know if they are offering it as a bank of it’s just a brokers platform that bank trying to sell it by it’s reputation. Anyone knows accurate info?

Thnx

#18

Look up "Fake News" and Website advertisements and you’ll understand what I mean by Pervasive….

See video a few posts above…

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#19

Hiya @Trendswithbenefits

Video was good and guy spoke well, but I didn’t like any of brokers in the suggestion list. It’s little strange why a knowledgeable guy like him, just put some of worst market brokers in his suggestion list.

#20

You can determine this by the following steps:

  1. Asking reliable brokers how they execute orders. They will probably give you an answer, whether they pass orders directly to LP (STP) or use aggregate LP feed which matches your order with LP offering best execution price.

  2. Watch (or read) how broker performs during news. Volatility is a traders enemy (in some sense) since it leads to widening spreads on LP which try to protect themselves from being on the wrong side. Also your orders can be executed with slippage since servers become overloaded during news because of sharp increase of orders sent from other traders. If you see or read about price spikes, platform freezes probably their servers are weak and their pick of liquidity providers is not very efficient. For STP broker who focuses only on one LP this can generate even more problems since the broker doesn’t “diversify” its feed.

Hope it helps. Thanks.

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